CHAPTER 1: First the Forest, then the Trees: An Overview of Employment and Labor Law
INTRODUCTION
Chapter one introduces the student to foundations of labor and employment laws and how
political, social, and economic conditions have contributed to the rise and fall of 1) government
intervention in the employer/employee relationship, and 2) the influence of organized labor.
Historical examples date back to the New Testament of the Bible and should enlighten the student
to the fact that the employer/employee struggle for power speaks directly to the nature of human
psychology and the quest for power and resources.
After reading this chapter, students should realize that the balance of power in the
employer/employee relationship is decidedly on the employer’s side, absent any government
invention or organized opposition, as long as there is a ready and willing labor pool. Indeed, up
until the Industrial Revolution, even the legal system favored the employer through laws which
prohibited employees from leaving their employers in search of higher pay and prohibited them
from organizing to demand higher wages, benefits, or better working conditions. However,
developing social awareness for individual rights have led lawmakers in the United States to pass
a long list of laws designed to balance the power in the employer/employee relationship.
Chapter one not only introduces students to all of the major legal theories and laws that will be
covered in succeeding chapters, it portrays these laws within the social and political contexts that
contributed to their evolution. It is critical that students understand this very important
relationship because it will assist them not only in understanding how we arrived where we are
today, but how employment laws may continue to change, as the stressors in our society change.
CHAPTER OUTLINE
I. INTRODUCTION
One may consider the craftsman guilds as the earliest forms of unions. As early as the
Middle Ages, employment in many trades was restricted to those in the proper class
or family. However, as these guilds grew, so also did corruption within the system.
This ultimately led to working class revolts, spawning harsh reprisals from those in
authority. The balance of power swung briefly to the worker’s side during the mid-
14th century when deaths due to the plague significantly reduced the labor pool.
, However, government response was to mandate lower wages, penalize would be
employers who attempted to induce a worker to abandon his current job for promise
of higher wages, and punish those who refused to work.
The tide began to turn with the birth of the Industrial Revolution. As challenges
within the judicial system progressed, common law* swung to a seemingly more
neutral position of employment-at-will. This doctrine espouses that neither the
employee nor the employer are bound by any contract of continued employment and
either can terminate the employment relationship, at any time, for any reason, so long
as the reason is not otherwise illegal. However, in reality, the employer still holds the
power in the relationship, as long as there is a ready and able labor pool.
Since the balance of power remained with the employer, employees banded together
into labor unions. Although early courts viewed them as criminal conspiracies,
unions began to win favor with the courts beginning in 1842.
*Common law is law that is made through court opinions, rather than by a formal
lawmaking process.
I. THE NEW DEAL AND THE RISE OF THE MODERN AMERICAN UNION
A. New Deal Legislation passed at the urging of President Franklin D. Roosevelt
i. The Social Security Act (1935) provides modest pensions to retired
workers.
ii. The National Labor Relations Act (1935) sets the ground rules for the
give and take between labor unions and corporate managers.
iii. The Walsh-Healy Act (1936) the first of several statutes to set the terms
and conditions of employment to be provided by government contractors.
iv. The Merchant Marine (Jones) Act (1936 provides remedies for injured
sailors.
v. The Fair Labor Standards Act (1938) sets minimum wages, mandates
overtime pay, and regulates child labor. (p.3)
B. Despite the impressive list, changes did not come easy. The Supreme Court had
, repeatedly refused to allow any employee protection laws, declaring them
unconstitutional. Then two things happened:
i. President Roosevelt threatened to increase the number of Justices on the
Supreme Court (this was within his power), if the Court did not change
it’s view of employment protection legislation, and
ii. The Court voted to validate state legislation that required employers to
pay women a minimum wage. (This case is commonly referred to as:
“the switch in time that saved the nine”)
1. Case: West Coast Hotel Company v. Parrish
2. Chambermaid, Elsie Parrish was required to “kick-back” a part of
her state mandated wages to the hotel, effectively reducing her
minimum earnings.
3. Washington Supreme Court found in her favor.
4. U.S. Supreme Court upheld the decision, reasoning:
a. It is in the public interest to safeguard women’s health
and protect them from unscrupulous employers,
b. the protection of women is a legitimate end of the
exercise of state power, and
c. the requirement of a fair minimum wage designed so the
woman can meet the “very necessities of existence” is a
means of protection.
From this point forward, New Deal legislations gained a foothold and labor unions began
to grow and increase in membership.
II. THE POST WAR DECLINE OF ORGANIZED LABOR
, Several significant issues and trends combined to cause the gradual decline of
organized labor:
A. Union abuse of power: John L. Lewis, president of the United Mine Worker’s
Union called for a strike, at the height of WWII, making miners look unpatriotic
and selfish, creating a very negative perception of unions; toward the end of the
war, may other unions struck, as companies made big prophets while wages
remained frozen. Believing that the American Federation of Labor/Congress of
Industrial Organizations (AFL-CIO) had become too powerful, congress passed
the Taft-Hartley Act (1947) making it illegal to require an employee to join a
union in order to obtain or keep a job (and establishing other unfair labor
practices on the part of union.)
B. Political scrutiny of illegal and unethical activity: Paranoia during the Cold War
between the U.S. and the U.S.S.R. led some politicians, notably Sen. Joseph
McCarthy, to suspect Communist influence had infiltrated the International
Longshoreman’s Union. Additionally, Sen. Estes Kefauver and others alleged a
connection between organized labor and organized crime.
C. Globalization: The U.S. manufacturing industry has been pressured by Japan’s
post WWI restructuring, Asian and European competition. The manufacturing
sector was the bedrock of unionism.
Globalization is the integration of national economies into a worldwide
economy due to trade, investment, migration, and information technology.
D. Statutes protecting individual employee rights: Since the 1960s, there has been an
onslaught of legislation providing protections once only available through union
negotiation.
i. Title VII of the Civil Rights Act of 1964 was the most significant
legislation protecting employees from discrimination on the basis of sex,
religion, national origin, race, color, or religion.
ii. Age Discrimination in Employment Act (ADEA) prohibits
discrimination against workers 40 years of age and older.
iii. Court decision recognizing a legal theory of wrongful discharge.
INTRODUCTION
Chapter one introduces the student to foundations of labor and employment laws and how
political, social, and economic conditions have contributed to the rise and fall of 1) government
intervention in the employer/employee relationship, and 2) the influence of organized labor.
Historical examples date back to the New Testament of the Bible and should enlighten the student
to the fact that the employer/employee struggle for power speaks directly to the nature of human
psychology and the quest for power and resources.
After reading this chapter, students should realize that the balance of power in the
employer/employee relationship is decidedly on the employer’s side, absent any government
invention or organized opposition, as long as there is a ready and willing labor pool. Indeed, up
until the Industrial Revolution, even the legal system favored the employer through laws which
prohibited employees from leaving their employers in search of higher pay and prohibited them
from organizing to demand higher wages, benefits, or better working conditions. However,
developing social awareness for individual rights have led lawmakers in the United States to pass
a long list of laws designed to balance the power in the employer/employee relationship.
Chapter one not only introduces students to all of the major legal theories and laws that will be
covered in succeeding chapters, it portrays these laws within the social and political contexts that
contributed to their evolution. It is critical that students understand this very important
relationship because it will assist them not only in understanding how we arrived where we are
today, but how employment laws may continue to change, as the stressors in our society change.
CHAPTER OUTLINE
I. INTRODUCTION
One may consider the craftsman guilds as the earliest forms of unions. As early as the
Middle Ages, employment in many trades was restricted to those in the proper class
or family. However, as these guilds grew, so also did corruption within the system.
This ultimately led to working class revolts, spawning harsh reprisals from those in
authority. The balance of power swung briefly to the worker’s side during the mid-
14th century when deaths due to the plague significantly reduced the labor pool.
, However, government response was to mandate lower wages, penalize would be
employers who attempted to induce a worker to abandon his current job for promise
of higher wages, and punish those who refused to work.
The tide began to turn with the birth of the Industrial Revolution. As challenges
within the judicial system progressed, common law* swung to a seemingly more
neutral position of employment-at-will. This doctrine espouses that neither the
employee nor the employer are bound by any contract of continued employment and
either can terminate the employment relationship, at any time, for any reason, so long
as the reason is not otherwise illegal. However, in reality, the employer still holds the
power in the relationship, as long as there is a ready and able labor pool.
Since the balance of power remained with the employer, employees banded together
into labor unions. Although early courts viewed them as criminal conspiracies,
unions began to win favor with the courts beginning in 1842.
*Common law is law that is made through court opinions, rather than by a formal
lawmaking process.
I. THE NEW DEAL AND THE RISE OF THE MODERN AMERICAN UNION
A. New Deal Legislation passed at the urging of President Franklin D. Roosevelt
i. The Social Security Act (1935) provides modest pensions to retired
workers.
ii. The National Labor Relations Act (1935) sets the ground rules for the
give and take between labor unions and corporate managers.
iii. The Walsh-Healy Act (1936) the first of several statutes to set the terms
and conditions of employment to be provided by government contractors.
iv. The Merchant Marine (Jones) Act (1936 provides remedies for injured
sailors.
v. The Fair Labor Standards Act (1938) sets minimum wages, mandates
overtime pay, and regulates child labor. (p.3)
B. Despite the impressive list, changes did not come easy. The Supreme Court had
, repeatedly refused to allow any employee protection laws, declaring them
unconstitutional. Then two things happened:
i. President Roosevelt threatened to increase the number of Justices on the
Supreme Court (this was within his power), if the Court did not change
it’s view of employment protection legislation, and
ii. The Court voted to validate state legislation that required employers to
pay women a minimum wage. (This case is commonly referred to as:
“the switch in time that saved the nine”)
1. Case: West Coast Hotel Company v. Parrish
2. Chambermaid, Elsie Parrish was required to “kick-back” a part of
her state mandated wages to the hotel, effectively reducing her
minimum earnings.
3. Washington Supreme Court found in her favor.
4. U.S. Supreme Court upheld the decision, reasoning:
a. It is in the public interest to safeguard women’s health
and protect them from unscrupulous employers,
b. the protection of women is a legitimate end of the
exercise of state power, and
c. the requirement of a fair minimum wage designed so the
woman can meet the “very necessities of existence” is a
means of protection.
From this point forward, New Deal legislations gained a foothold and labor unions began
to grow and increase in membership.
II. THE POST WAR DECLINE OF ORGANIZED LABOR
, Several significant issues and trends combined to cause the gradual decline of
organized labor:
A. Union abuse of power: John L. Lewis, president of the United Mine Worker’s
Union called for a strike, at the height of WWII, making miners look unpatriotic
and selfish, creating a very negative perception of unions; toward the end of the
war, may other unions struck, as companies made big prophets while wages
remained frozen. Believing that the American Federation of Labor/Congress of
Industrial Organizations (AFL-CIO) had become too powerful, congress passed
the Taft-Hartley Act (1947) making it illegal to require an employee to join a
union in order to obtain or keep a job (and establishing other unfair labor
practices on the part of union.)
B. Political scrutiny of illegal and unethical activity: Paranoia during the Cold War
between the U.S. and the U.S.S.R. led some politicians, notably Sen. Joseph
McCarthy, to suspect Communist influence had infiltrated the International
Longshoreman’s Union. Additionally, Sen. Estes Kefauver and others alleged a
connection between organized labor and organized crime.
C. Globalization: The U.S. manufacturing industry has been pressured by Japan’s
post WWI restructuring, Asian and European competition. The manufacturing
sector was the bedrock of unionism.
Globalization is the integration of national economies into a worldwide
economy due to trade, investment, migration, and information technology.
D. Statutes protecting individual employee rights: Since the 1960s, there has been an
onslaught of legislation providing protections once only available through union
negotiation.
i. Title VII of the Civil Rights Act of 1964 was the most significant
legislation protecting employees from discrimination on the basis of sex,
religion, national origin, race, color, or religion.
ii. Age Discrimination in Employment Act (ADEA) prohibits
discrimination against workers 40 years of age and older.
iii. Court decision recognizing a legal theory of wrongful discharge.
