Wilson v. New

Established the power of Congress to fix a maximum work day and to fix a minimum wage within the public sector of work.

Before March of 1916, two systems controlled wages of railroad employees. One was an eight-hour standard of work and wages with additional pay for overtime, governing about 15 percent of the railroads. The other was a stated mileage task of 100 miles to be performed during ten hours, with extra pay for any excess, in force on about 85 percent of the roads. In March, however, the organizations representing the employees of the railroads made a formal demand on railroad employers that, except for passenger trains, the 100-mile task be fixed for eight hours. They also made various demands on salary and wage adjustments. The employers refused the demands, and the employees, through their organizations, by concert of action, took the steps to call a general strike of all railroad employees throughout the country.

President Woodrow Wilson invited a conference between the parties. He proposed arbitration. The employers agreed, but the employees rejected it. The president then suggested the eight-hour standard of work and wages. The employers rejected it, but the employees accepted it. With no agreement in sight, the employees called a general strike. The president, trying to avert a commercial disaster and grave personal suffering if the strike was not prevented, asked Congress to fix, by law, the eight-hour standard of work and wages, and to create an official body for observing the operation of the legislation. Congress responded by enacting the statute, the validity of which is considered here.

The effect of the Act of 3 and 5 September 1916 is not only to establish a permanent eight-hour standard for work and wages as between the carriers and employees affected, but also to fix a scale of minimum wages for the eight-hour day and proportionally for overtime, to be in force only during the limited period defined by the act.

The Court ruled that in an emergency arising from a nationwide dispute over wages between railroad companies and their train employees, in which a general strike with dire consequences overhangs the country, Congress had power to prescribe a standard of minimum wages, not confiscatory in its effects but obligatory on both parties, in order to avert calamity and offer opportunity to both parties to substitute a standard on their own. The business of common carriers by rail was one aspect of public business, and this public interest gives right of regulation to the full extent necessary to secure and protect it. Although emergency may not create power, it may afford reason for exerting a power already enjoyed.

The Court ruled that, viewed as an act fixing wages, the statute merely illustrated the character of regulation essential, and hence permissible, for the protection of the public right. The act did not invade the private rights of carriers, since all their business and property must be redeemed subject to the regulatory power to insure fit relief by appropriate means.

The Court also said that the act did not invade private rights of employees, since their rights to demand wages according to their desire and to leave employment if the demand is reused, were not such as they might be if the employment were in private business, but are necessarily subject to limitation by Congress, the employment accepted being in a business charged with a public interest which Congress may regulate under the commerce power.