313 U.S. 236 (1941), 671, Olsen v. Nebraska

Docket Nº:No. 671
Citation:313 U.S. 236, 61 S.Ct. 862, 85 L.Ed. 1305
Party Name:Olsen v. Nebraska
Case Date:April 28, 1941
Court:United States Supreme Court

Page 236

313 U.S. 236 (1941)

61 S.Ct. 862, 85 L.Ed. 1305




No. 671

United States Supreme Court

April 28, 1941

Argued April 8, 9, 1941



1. A Nebraska statute limiting the amount of the fee which may be charged by private employment agencies to ten percent of the first month's salary or wages of the person for whom employment was obtained held consistent with due process of law. Ribnik v. McBride, 277 U.S. 350, overruled. P. 243.

2. The wisdom, need, and appropriateness of this legislation are for the State to determine. P. 246.

138 Neb. 574, 293 N.W. 393, reversed.

Certiorari, 312 U.S. 673, to review a judgment for a peremptory writ of mandamus requiring the Secretary of Labor of the Nebraska to issue licenses for the operation of private employment agencies. The above-named association was the original relator. A number of other employment agencies which sought and obtained the same relief by intervention were also respondents in this court. Mr. Olsen was substituted for his predecessor in office, Mr. Kinney, post, p. 541.

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DOUGLAS, J., lead opinion

MR. JUSTICE DOUGLAS delivered the opinion of the Court.

In reliance upon Ribnik v. McBride, 277 U.S. 350, the Supreme Court of Nebraska held, one judge dissenting,

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that a statute of that state fixing the maximum compensation which a private employment agency might collect from an applicant for employment1 was [61 S.Ct. 863] unconstitutional2

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under the due process clause of the Fourteenth Amendment. State ex rel. Western Reference & Bond Assn. v. Kinney, 138 Neb. 574, 293 N.W. 393. The case is here on a petition for certiorari which we granted because

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of the importance of the constitutional question which was raised.

The action is for a peremptory writ of mandamus ordering petitioner, Secretary of Labor of Nebraska, to issue a license to the relator3 to operate a private employment agency for the year commencing May 1, 1940. The license was withheld because of relator's refusal to limit its maximum compensation, as provided by the statute, to ten percent of the first month's salary or wages of the person for whom employment was obtained. The petition in mandamus [61 S.Ct. 864] challenged the constitutionality of those provisions of the act.4 The answer sought to sustain them by alleging that the business of a private employment agency is "vitally affected with a public interest," and subject to such regulation under the police power of the state. The relator's motion for judgment on the pleadings was sustained, and it was ordered that a peremptory writ of mandamus should issue.

We disagree with the Supreme Court of Nebraska. The statutory provisions in question do not violate the due process clause of the Fourteenth Amendment.

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The drift away from Ribnik v. McBride, supra, has been so great that it can no longer be deemed a controlling authority. It was decided in 1928. In the following year, this Court held that Tennessee had no power to fix prices at which gasoline might be sold in the state. Williams v. Standard Oil Co., 278 U.S. 235. Save for that decision and Morehead v. Tipaldo, 298 U.S. 587, holding unconstitutional a New York statute authorizing the fixing of women's wages, the subsequent cases in this Court have given increasingly wider scope to the price-fixing powers of the states and of Congress.5 Tagg Bros. & Moorhead v. United States, 280 U.S. 420, decided in 1930, upheld the power of the Secretary of Agriculture, under the Packers and Stockyards Act, to determine the just and reasonable charges of persons engaged in the business of buying and selling in interstate commerce livestock at a stockyard on a commission basis. In 1931, a New Jersey statute limiting commissions of agents of fire insurance companies was sustained by O'Gorman & Young, Inc. v. Hartford Fire Ins. Co., 282 U.S. 251. A New York statute authorizing the fixing of minimum and maximum retail prices for milk was upheld in 1934. Nebbia v. New York, 291 U.S. 502. And see Hegeman Farms Corp. v. Baldwin, 293 U.S. 163; Borden's Farm Products Co., Inc. v. Ten Eyck, 297 U.S. 251. Cf. Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 511; Mayflower Farms, Inc. v. Ten Eyck, 297 U.S. 266. In 1937, Adkins v. Children's Hospital, 261 U.S. 525, was overruled, and a statute of Washington which authorized the fixing of minimum wages for women and minors was sustained. West Coast Hotel Co. v. Parrish, 300 U.S. 379. In the same year, Townsend v. Yeomans, 301 U.S. 441, upheld a

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Georgia statute fixing maximum warehouse charges for the handling and selling of leaf tobacco. Cf. Mulford v. Smith, 307 U.S. 38; Currin v. Wallace, 306 U.S. 1. The power of Congress under the commerce clause to authorize the fixing of minimum prices for milk was upheld in United States v. Rock Royal Co-Operative Inc., 307 U.S. 533, decided in 1939. The next year, the price-fixing provisions of the Bituminous Coal Act of 1937 were sustained. Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381. And, at this term, we upheld the minimum wage and maximum hour provisions of the Fair Labor Standards Act of 1938. United States v. Darby, 312 U.S. 100. These cases represent more than scattered examples of [61 S.Ct. 865] constitutionally permissible price-fixing schemes. They represent in large measure a basic departure from the philosophy and approach of the majority in the Ribnik case. The standard there employed, following that used in Tyson & Brother v. Banton, 273 U.S. 418, 430 et seq., was that the constitutional validity of price-fixing legislation, at least in absence of a so-called emergency,6 was dependent on whether or not the business in question was "affected with a public interest." Cf. Brazee v. Michigan, 241 U.S. 340. It was said to be so affected if it had been "devoted to the public use" and if "an interest in effect" had been granted "to the public in that use." Ribnik v. McBride, supra, p. 355. That test, labeled by Mr. Justice Holmes in his dissent in the Tyson case (273 U.S. at p. 446) as "little more that a fiction," was discarded in Nebbia v. New York, supra, pp. 531-539. It was there stated that such criteria "are not susceptible of definition and form an unsatisfactory test of the constitutionality...

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