Sie sind auf Seite 1von 11

You should go back where you belong and advise Mussolini how to make good honest citizens in

Italy. The Italians are preponderantly our murderers and bootleggers . . Like a lot of other
foreign spawn, you do not appreciate the country which supports and tolerates you.

— Letter from President Hoover to Senator Fiorello LaGuardia1

The Norris-LaGuardia Act: Labor, Capital and Power

President Hoover’s less-than-veiled condescension for an immigrant congressman reflects the

social and political class structure of America in the late 1920s. As an immigrant, Fiorello LaGuardia

understood and sympathized with the plight and powerlessness of the working class, and his alienation in

Washington mirrored the same marginalization of the new immigrant workers who led exiled lives in the

nation’s ghettos, factories, and coal mines. The era of big industry and mass immigration had changed

economic and political reality: the law of supply and demand meant labor-dependent, organized,

powerful capitalists reigned over employment-dependent, unorganized, powerless employees and their

wages and working conditions. Capitalists were almost always successful in quashing strikes through the

use of federal injunction proceedings, and laborers toiled under conditions of indentured servitude. The

72nd Congress enacted the Norris-LaGuardia Act to protect the right of workers to organize and to assert

their collective rights when selling their labor in the marketplace.

In 1889, the Supreme Court issued a decision in Mogul Steamship Co. v. McGregor, Gow & Co.,

23 Q.B. Div. 598 (1889), one that would resonate against labor unions for the next forty years even

though the dispute lay between two shipping companies. The defendants were a group of ship owners

who combined themselves into a monopoly to drive the plaintiffs and other competitors out of business in

order to secure control of the carriage of tea from Chinese ports. The Court held for the defendants and

established the test of legitimate objectives. It found the defendants' combination legitimate because:

1
E. Digby Baltzell, The Protestant Establishment, Aristocracy and Caste in America

1
Acts which intentionally damage another's trade are actionable if done without just cause or
excuse. Here, just cause or excuse is to be found in the defendants' right to carry on their
own trade freely in the mode and manner that best suits them, and which they think best
calculated to secure their advantage . . the truth is, that the combination of capital for
purposes of trade and competition is a very different thing from such a combination of
several persons against one, with a view to harm him, as falls under the head of an
indictable conspiracy.

Therefore, the defendants' actions were justified because their ultimate objective was legitimate – to carry

on one's trade freely. Thus, the Court established an objectives test, one which eventually would apply to

labor organizations as well.

One year after the Mogul decision, in 1890, Congress enacted the Sherman Act, which declared

unlawful "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade

or commerce among the several States, or with foreign nations." The statute aimed to prevent

manufacturers and suppliers from entering into agreements that fixed the price or supply of goods, and it

authorized the Attorney General to institute federal injunction proceedings. Anyone who claimed injury

to their business as a result of violations of the act were eligible to collect treble damages in a civil suit.

However, the federal judiciary eventually interpreted the statutory language to include labor unions, who

by their very collective nature are "combinations," and employers sought relief from industrial strife

through the use of the federal injunction under the auspices of the Sherman Act.

The Supreme Court decided in Loewe v. Lawlor that the Sherman Act applied to labor

organizations. The economic forces that brought Loewe, known as the Danbury Hatters case, to the

courtroom are typical of the era. The widespread use of the hydraulic hat presser reduced the need for hat

finishers because it replaced the need for skill with steam-powered machinery. The Depression further

displaced skilled craftsmen because employers could now pay by the hour rather than by the craft piece.

In response, makers and finishers merged into the United Hatters of America and joined the American

2
Federation of Labor. Due to the A.F. of L's maintenance of an influential "Do Not Patronize" boycott list

of employers of non-union workers, only 12 of the 120 hat makers in the nation employed non-union

workers by 1902.2 Dietrich E. Loewe owned a hat factory in Danbury, Connecticut, and he could not

afford to employ union members and remain in business. The union demanded that he organize and

retailers who sold Loewe's hats made the A.F. of L's "unfair" list. Loewe retaliated under the Sherman

Act: he attached the real estate and bank records of over 240 hatters and filed suit against them for treble

damages under the Sherman Act. The Court fashioned the question around the Mogul test: Was the

union's product boycott a legitimate end and is it legal to persuade one not to buy from or contract with a

supplier? The union's defense was that it intended to manipulated the price of labor rather than goods in

interstate commerce and to eliminate competition in the labor market. The Court relied on the plain

language of the statute and determined that "any combination" in restraint of trade clearly applied to

organized labor and held its market manipulation illegitimate and violative of the act.

The case law took another sharp turn in Coronado Coal Co. v. United Mine Workers, 268 U.S.

295 (1925). The Bache-Denman Coal Company brought an action under the Sherman Act for treble

damages against the mine workers' union for property and business damage. A violent strike had

occurred at the plaintiffs' Sebastian County mines in Arkansas because Bache had announced his intention

to close the mines and re-open them on a non-union basis. Violence erupted when Bache re-opened his

mines; two people were killed and dynamite destroyed the mine premises. The Supreme Court first

remanded the case because it found that the strike was purely local, and therefore could not mettle with

interstate commerce. On remand, new evidence was introduced that the defendants intended to cripple all
2
"According to one historian, the situation of hat making was fairly typical of a number of industries
characterized by numerous small competitors and cut-throat competition. To these industries, unions offered
the prospect of stabilization: of wringing out those competitors unable to meet union wage and work
standards leaving the remaining competitors with higher profit margins and better paid workers. It was a
case, as he put it, of 'workers organizing capitalists' who, because of competitive conditions, were unable to
organize themselves." P. 32

3
of the plaintiffs' non-union mines so as to prevent their competition with unionized mines in other states.

The Court said "when the intent of those unlawfully preventing the manufacture or production is shown to

be to restrain or control the supply entering and moving in interstate commerce, or the price of it in

interstate markets, their action is a direct violation of the Anti-Trust Act." Id. (emphasis added) The

significance of the decision, which was to echo throughout decisions in the 20s, was the Court's finding of

a subjective intent on the part of labor organizations, one which courts needed to judge as either legitimate

or illegitimate under the Mogul test. Since no statute defined which acts labor organizations could

lawfully engage in and for what purpose, judges became the sole estimators of labor's legitimacy.

Injunctions issued ex parte according the individual judge's own social mores concerning that which was

a legitimate labor objective, with no eye towards the actions of the employer, who was always engaged in

a legitimate purpose of conducting business.

In response, Congress passed the Clayton Act, 38 Stat. 730 (1914), as amended, 15 U.S.C. §§ 12

et seq. (1988), to specifically exempt labor unions from the reach of the Sherman Act. Section 6 stated

that,

The labor of a human being is not a commodity or article of commerce. Nothing


contained in the anti-trust laws shall be construed to forbid the existence and
operation of labor . . . or to forbid or restrain individual members of such
organizations from lawfully carrying out the legitimate objects thereof; nor shall such
organizations or members thereof, be held or construed to be illegal combinations or
conspiracies in restraint of trade, under the anti-trust laws.

In Section 20, Congress also proscribed the use of the federal injunction in labor disputes. That

section declared,

That no restraining order or injunction shall be granted by any court of the United
States . . . between an employer and employees . . . involving or growing out of a
labor dispute concerning terms or conditions of employment, unless necessary to

4
prevent irreparable injury to property, or to a property right, of the party making the
application, for which injury there is no adequate remedy at law . . .

Despite these two congressional declarations, the Clayton Act suffered evisceration in the federal

courts, of which Duplex Printing Press v. Deering is the seminal case.

The immediate problem lay in the role and reach of the federal judiciary in industrial disputes.

During floor debate, Rep. LaGuardia quipped, “Gentlemen, there is one reason why this legislation is

before Congress, and that one reason is disobedience of the law on the part of whom? On the part of

organized labor? No. Disobedience of the law on the part of a few federal judges.” In 1914, Congress

had clearly restrained the federal courts in § 20 of the Clayton Act, which declared that “no restraining

order or injunction shall be granted by any court of the United States” against employees engaged in a

labor dispute. This, the judiciary conveniently decided to sidestep. Instead, federal judges continued to

rely on their interpretation of § 7 of the Sherman Anti-Trust Act of 1890, which the Supreme Court, in

Loewe v. Lawlor, 208 U.S. 274 (1908), deemed applicable to labor unions whose activities obstructed free

trade or commerce between the states. Therefore, federal injunctions issued from the courts with relative

ease on the basis of this corrupted interpretation of the labor law, despite their proscription in § 20 of the

Clayton Act. Moreover, in 1921, the Supreme Court issued an opinion in Duplex Printing Press Co. v.

Deering, 254 U.S. 443 so restrictive of the definition of a labor dispute embodied in § 20 that

Representative LaGuardia termed the provision now “more or less valueless to labor.”3 To the undoubted,

absolute shock of some legislators, the Court noted that the language of § 20 “strongly rebut[s] a

legislative intent to confer a general immunity for conduct violative of the anti-trust laws.”4 Clearly then,

3
Box and Cok, Labor Law
4
Id.

5
the passage of the Clayton Act had in no way shielded unions from the reach of the Sherman Act, and the

judiciary’s liberal use of the injunction, despite the provisions of § 20, led Congress to draft a bill to

“correct the evils which, in the judgment of many, had been constantly accumulating in the judicial

decisions justifying the use of the injunction in labor disputes.”

Injunctions were a highly successful tool for employers because they were issued ex parte, they

effectively quashed the organizational and emotional momentum so crucial to the power and clout of a

labor strike, and leaders who nonetheless violated them could be jailed for contempt, without a jury trial.

During debate on the floor of the House, Congressman Browning stated,

We have a situation now by which a man may be enjoined by a Federal court without due
notice, and either through ignorance or intention, he violates that injunction. He is
arraigned before the court, which is not only the legislature but the grand jury, the trial
judge and the prosecuting attorney; the man is sent to jail without a trial by jury, which is
guaranteed to him under the Constitution.5

This aspect of equitable injunctions was most troubling to proponents of the bill. Congressman

Greenwood said, “I do not believe that the judge should apply criminal laws on the equity side on the

theory that contempt has been committed of an order issued that he should not have issued in the first

place.”6 Furthermore, not only had federal judges issued injunctions at will, the reach and severity of

those injunctions compounded their usurpation of legislative intent. In a veritable diatribe against them,

Representative Greenwood railed:

There have been Federal judges who have denied . . . the extending of assistance to
families of workmen who are in distress because the head of the family had joined his
coworkers in a strike. They have forbidden workers the constitutional right even to confer
with each other on common questions and problems arising out of their employment. They
were not allowed to appeal, in possession suits where they lived in a company dwelling
house, and have been dispossessed in a justice of the peace court . . . . There have been
injunctions . . .denying them the right to meet in their churches and sing hymns and join

5
Cong. Rec. 72:1, 5471
6
Cong. Rec. 72:1, 5467

6
together in worship because these places were in close proximity to the property or to the
industry where a strike had occurred. One Federal judge enjoined the singing by strikers
of the good old hymn “Onward Christian Soldier.”7

Injunctions, therefore, as the federal courts issued them, were in essence judge-made law that withheld

from labor the opportunity to defend itself or lodge counteraccusations. They violated all notions of

fairness – the very foundation of an equity court. Senator Shipstead sought rectification.

In light of the judiciary’s legislative trespasses, Senator Shipstead of Minnesota introduced, in

nascent form, the bill that eventually became the Norris-LaGuardia Act.8 He seized upon the 13th

Amendment to make a compelling case against the labor injunction through an attack on the proliferation

of yellow dog contracts. Senator Shipstead’s opposition justified the federal injunction as a proper

extension of the 5th Amendment’s bar against the deprivation of property without due process of law. The

property rights argument partly grew out of cases such as Adair v. U.S., 208 U.S. 161 and Bedford Cut

Stone Co. v. Journeyman Stone Cutters’ Ass’n of North America, 274 U.S. 37, both of which embodied

“the same underlying conception, to wit, that an established business, its good will and organization, and

the right to contract and carry on business without interference from anyone, constitute property rights

protected by the fifth amendment.”9 Therefore, the 5th Amendment stripped § 6 of the Clayton Act,

which declared that the labor of a human being is neither a commodity nor an article of commerce, of any

force. Shipstead, on the other hand, contended that “if, out of the relationship of employer and employee,

a condition of involuntary servitude results, then the property rights protected by the fifth amendment

must yield to the protection of human freedom announced and guaranteed by the thirteenth amendment.”
7
Cong. Rec. 72:1 5467
8
On the House floor, Congressman O’Connor stated, “I congratulate the distinguished senior Senator from
Minnesota for his earnest work for years in behalf of this measure. Yes: I said Minnesota, not Nebraska,
because the anti-injunction bill was first introduced in the Senate and again year after year by Senator
Shipstead, who deserves credit alongside the gentleman from New York. For five years the bill has been
before the Senate and the House.” Cong. Rec. 72:1 5462
9
Injunctions in Labor Disputes, Senate No. 327, 71st Cong. 3rd Sess. at 3.

7
Despite the force of this reasoning, Shipstead’s bill failed. However, in the meantime, Senator

LaGuardia, “starting in 1924, [would introduce] at every House session anti-injunction legislation, which

was always carefully buried in the files of the Judiciary Committee.”10 He held hearings year after year

until the bill arrived on the floor of the House of Representatives.

The LaGuardia bill proposed several important solutions. First, it sought to limit the jurisdiction

of the federal courts to issue injunctions in labor disputes solely to the enjoinder of unlawful acts. This

provision essentially re-shackled the federal judges and imposed Congress’s rule of law upon the

permissible boundaries of the industrial dispute. Judges could no longer substitute their own judgment

about which activities warranted injunctive relief for that of the legislative branch. In the case of

unlawful acts, Congress would now command the hearing of testimony in open court, with the

opportunity for cross-examination, to allegations sworn to in a complaint. No injunction would issue

without any finding of fact. Under the then-existing scheme, judges awarded injunctive relief on the basis

of affidavits, sometimes perjured, rather than on the basis of sworn testimony taken in open court.

Second, the bill declared all yellow-dog contracts void and against public policy. In § 4, the Act outlined

nine labor activities insulated not only from injunctive relief, but also from the anti-trust tentacles of the

Sherman Act. These acts, when performed in concert, could no longer be considered an “unlawful

combination” for the purposes of the debilitating construction given the Sherman Act. Lastly, the Act

guaranteed the right to trial by jury for anyone accused of contempt for violation of any valid injunction.

When the legislation finally arrived in both chambers, the Senate passed it without much protest. The

more important debate occurred in the House of Representatives, where many congressmen extolled its

virtues before Representative Beck thundered away at it.

10
Howard Zinn, LaGuardia in Congress, Cornell University Press (1959)

8
Before Beck’s grand soliloquy, various legislators from both sides of the aisle offered their well-

versed support. They defended the constitutional power of Congress to limit the jurisdiction of the

inferior federal courts, especially in the face of “forty years of judge-made law.” Moreover, the

legislation was not an absolute license for labor to revolt in the face of a feeble judiciary because it left the

jurisdiction of state courts undisturbed. They agreed that states of peonage would crumble under

legislation designed to forever banish the use of the yellow-dog contract because, as Representative

O’Connor argued, “the employee practically signs the contract under coercion. To say he has a free

choice overlooks the fact that he must work to live and support his family. By necessity, he is at the

mercy of the work-offering agency in his community.”11 In terms of injunctions, O’Connor said, “in

some instances these injunctions have been so ridiculous that there has been a feeling of repulsion against

the Federal courts in general.”12 Proponents cited the transgressions of case law and the lop-side

injunctive relief process. In a bit of diplomacy, Representative Michener said, “Let me say to my very

conservative friends that the mere fact that organized labor is supporting this measure is not sufficient

cause for you to oppose it . . . capital is organized, and labor should have the right to organize.” In

anticipation of Beck’s labor-communist rant, Michener avowed, “the American Federation of Labor has

done more than any other group of our people in maintaining peace and order during this depression. It

has fought communism at every turn of the road, when, as a matter of fact, organized labor would have

been the ideal vehicle to carry communism to our people.” Eventually though, Beck took the floor.

Even though his speech eventually devolved into paranoid rhetoric of religion, communism and

dire warnings about the dissolution of democratic institutions, Beck still launched a forceful attack on

LaGuardia’s bill. Despite the existence of the Sherman and National Railway Acts, Beck most feared that

11
Cong. Rec. 72:1 5464
12
Id.

9
Congress would now be unleashing a union so nationally powerful and corrupt as to result in “the possible

rule of the proletariat in free America.”13 For Beck, the bill’s ultimate misgiving lay in its failure to

account for motive because “obviously, an industrial dispute can be made the means of compelling some

action wholly disconnected with the causes and conditions of employment.” If unions could leverage

enough economic damage through strikes, their political influence would be formidable, and strikes could

be called at the political whim of the union. Malevolent unions could threaten the freedom of all of

America, indeed, control the “freedom of decision of the Congress itself” through political blackmail. He

cited the Pullman Company strike, “which was intended to paralyze all traffic into the city of Chicago,

with the potential threat of even denying the children of that city the milk requisite for their life (sic).” In

grand rhetorical style, he orated,

Let me remind the gentlemen on the Democratic side of the aisle that one of the
crowning achievements of that great and noble President, Grover Cleveland, was to
instruct his Attorney General to go into the United States courts and there bring the
parties that were trying to starve the people of the United States into compelling the
Pullman Company to accede to the demands of the Pullman workmen; and, as a result of
that bill in equity . . . a permanent injunction was entered.

The implication, of course, was that if LaGuardia had had his way during that strike, all of Chicago would

have starved to death. Beck then cited another railroad case of 1916 in which he claimed President

Wilson cowed to the demands of railroad employees, and Beck declared (wrongly) that “a Sovereign state

cannot place an embargo upon interstate trade; yet this organization of railroad employees, with their

power to tie up traffic from the Atlantic to the Pacific and from the Lakes to the Gulf, can put on such an

embargo.” (For a more pithy effect, Beck also mentioned the Bolshevists at the gates of Warsaw, the

wickedly violent Shopcraft strike of 1922, and the “injunctions” issued in the Ten Commandments under

language beginning with “thou shalt not.”) Furthermore, Congress had no right to invade judicial turf
13
Cong. Rec. 72:1, 5474

10
because the Constitution, rather than Congress, invested the judicial power, and thus the equity power to

issue restraining orders, directly in the federal courts. To Congressman Beck, once enough economic and

political power was transferred to the workers, the United States would begin a “long march in the

direction of Moscow.” Despite Beck’s irrational fears and obvious propaganda, his prophecy against

union corruption and political power was not untenable.

LaGuardia, in reply, disabused the chamber of Beck’s legal untruths and admonished him for his

blatant mischaracterization of the prevailing law. Beck lost and the House passed the measure with only

fourteen votes in opposition. President Hoover signed into law one of the most resilient pieces of

American labor legislation. The impudent Republican had won.

1. Attach the first page of the public law.

2. Conference committee report and Judiciary Report pages attached.

3. The Judiciary Committee considered this bill.

4. Did Congress hold hearings on other bills? The only “other” bill would have been Shipstead’s, and

LaGuardia was holding hearings at the same time Shipstead was pushing his bill.

5. Did the President introduce a bill on the same issue. I found none, and Hoover’s States of the Union

addresses yielded no information.

6. Myriad journals exist on labor law, but there was a newspaper titled Labor in the 30s.

7. CQA did not exist in the 30s.

11