426 U.S. 833 (1976), 74-878, National League of Cities v. Usery

Docket Nº:No. 74-878
Citation:426 U.S. 833, 96 S.Ct. 2465, 49 L.Ed.2d 245
Party Name:National League of Cities v. Usery
Case Date:June 24, 1976
Court:United States Supreme Court
 
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Page 833

426 U.S. 833 (1976)

96 S.Ct. 2465, 49 L.Ed.2d 245

National League of Cities

v.

Usery

No. 74-878

United States Supreme Court

June 24, 1976

Argued April 6, 1975

Reargued March 2, 1976

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Syllabus

The Fair Labor Standards Act was amended in 1974 so as to extend the Act's minimum wage and maximum hour provisions to almost all employees of States and their political subdivisions. Appellants (including a number of cities and States) in these cases brought an action against appellee Secretary of Labor challenging the validity of these 1974 amendments and seeking declaratory and injunctive relief. A three-judge District Court dismissed the complaint for failure to state a claim upon which relief might be granted.

Held:

1. Insofar as the 1974 amendments operate directly to displace the States' abilities to structure employer employee relationships in areas of traditional governmental functions, such as fire prevention, police protection, sanitation, public health, and parks and recreation, they are not within the authority granted Congress by the Commerce Clause. In attempting to exercise its Commerce Clause power to prescribe minimum wages and maximum hours to be paid by the States in their sovereign capacities, Congress has sought to wield its power in a fashion that would impair the States' "ability to function effectively in a federal system," Fry v. United States, 421 U.S. 542, 547 n. 7, and this exercise of congressional authority does not comport with the federal system of government embodied in the Constitution. Pp. 840-852.

2. Congress may not exercise its power to regulate commerce so as to force directly upon the States its choices as to how essential decisions regarding the conduct of integral governmental functions are to be made. Fry v. United States, supra, distinguished; Maryland v. Wirtz, 392 U.S. 183, overruled. Pp. 852-855.

406 F.Supp. 826, reversed and remanded.

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REHNQUIST, J., delivered the opinion of the Court, in which BURGER, C.J., and STEWART, BLACKMUN, and POWELL, JJ., joined. BLACKMUN, J., filed a concurring opinion, post, p. 856. BRENNAN, J., filed a dissenting opinion, in which WHITE AND MARSHALL, JJ., joined, post, p. 856. STEVENS, J., filed a dissenting opinion, post, p. 880.

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REHNQUIST, J., lead opinion

MR. JUSTICE REHNQUIST delivered the opinion of the Court.

Nearly 40 year ago, Congress enacted the Fair Labor Standards Act,1 and required employer covered by the Act to pay their employees a minimum hourly wage2 and to pay them at one and one-half time their regular

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rate of pay for hours worked in excess of 40 during a workweek.3 By this Act, covered employers were required to keep certain records to aid in the enforcement of the Act,4 and to comply with specified child labor standards.5 This Court unanimously upheld the Act as a valid exercise of congressional authority under the commerce power in United States v. Darby, 312 U.S. 100 (1941), observing:

Whatever their motive and purpose, regulations of commerce which do not infringe some constitutional prohibition are within the plenary power conferred on Congress by the Commerce Clause.

Id. at 115.

The original Fair Labor Standards Act passed in 1938 specifically excluded the States and their political subdivisions from its coverage.6 In 1974, however, Congress enacted the most recent of a series of broadening amendments to the Act. By these amendments, Congress has extended the minimum wage and maximum hour provisions to almost all public employees employed by the States and by their various political subdivisions. Appellants in these cases include individual cities and States, the National League of Cities, and the National Governors' Conference;7 they brought an action in the District

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Court for the District of Columbia which challenged the validity of the 1974 amendments. They asserted, in effect, that, when Congress sought to apply the Fair Labor Standards Act provisions virtually across the board to employees of state and municipal governments it "infringed a constitutional prohibition" running in favor of the States as states. The gist of their complaint was not that the conditions of employment of such public employees were beyond the scope of the commerce power had those employees been employed in the private sector, but that the established constitutional doctrine of intergovernmental immunity consistently recognized in a long series of our cases affirmatively prevented the exercise of this authority in the manner which Congress chose in the 1974 amendments.

I

In a series of amendments beginning in 1961, Congress began to extend the provisions of the Fair Labor Standards Act to some types of public employees. The 1961 amendments to the Act8 extended its coverage to persons who were employed in "enterprises" engaged in commerce or in the production of goods for commerce.9 And in 1966, with the amendment of the definition of employers under the Act, the exemption heretofore extended to the [96 S.Ct. 2468] States and their political subdivisions was

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removed with respect to employees of state hospitals, institutions, and schools.10 We nevertheless sustained the validity of the combined effect of these two amendments in Maryland v. Wirtz, 392 U.S. 183 (1968).

In 1974, Congress again broadened the coverage of the Act, 88 Stat. 55. The definition of "employer" in the Act now specifically "includes a public agency," 29 U.S.C. § 203(d) (1970 ed., Supp. IV). In addition, the critical definition of "[e]nterprise[s] engaged in commerce or in the production of goods for commerce" was expanded to encompass "an activity of a public agency," and goes on to specify that

[t]he employees of an enterprise which is a public agency shall for purposes of this subsection be deemed to be employees engaged in commerce, or in the production of goods for commerce, or employees handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce.

29 U.S.C. § 203(s)(5) (1970 ed., Supp. IV). Under the amendments, "[p]ublic agency" is, in turn, defined as including

the Government of the United States; the government of a State or political subdivision thereof; any agency of the United States (including the United States Postal Service and Postal Rate Commission), a State, or a political subdivision of a State; or any interstate governmental agency.

29 U.S.C. § 203 (x) (1970 ed., Supp. IV). By its 1974 amendments, then, Congress has now entirely removed the exemption previously afforded States and their political subdivisions, substituting only the Act's general exemption for executive, administrative, or professional

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personnel, 29 U.S.C. § 213(a)(1), which is supplemented by provisions excluding from the Act's coverage those individuals holding public elective office or serving such an officeholder in one of several specific capacities. 29 U.S.C. § 203(e)(2)(C) (1970 ed., Supp. IV). The Act thus imposes upon almost all public employment the minimum wage and maximum hour requirements previously restricted to employees engaged in interstate commerce. These requirements are essentially identical to those imposed upon private employers, although the Act does attempt to make some provision for public employment relationships which are without counterpart in the private sector, such as those presented by fire protection and law enforcement personnel. See 29 U.S.C. § 207(k) (1970 ed., Supp. IV).

Challenging these 1974 amendments in the District Court, appellants sought both declaratory and injunctive relief against the amendments' application to them, and a three-judge court was accordingly convened pursuant to 28 U.S.C. § 2282. That court, after hearing argument on the law from the parties, granted appellee Secretary of Labor's motion to dismiss the complaint for failure to state a claim upon which relief might be granted. The District Court stated it was "troubled" by appellants' contentions that the amendments would intrude upon the States' performance of essential governmental functions. The court went on to say that it considered their contentions

substantial and that it may well be that the Supreme Court will feel it appropriate to draw back from the far-reaching implications of [Maryland v. Wirtz, supra], but that is a decision that only the Supreme Court can make, and, as a Federal district court ,we feel obliged to apply the Wirtz opinion as it stands.

National League of Cities v. Brennan, 406 F.Supp. 826, 828 (DC 1974).

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We noted probable jurisdiction in order to consider the important questions recognized by the District Court. 420 U.S. 906 (1975).11 We agree with the District Court that [96 S.Ct. 2469] the appellants' contentions are substantial. Indeed, upon full consideration of the question, we have decided that the "far-reaching implications" of Wirtz should be overruled, and that the judgment of the District Court must be reversed.

II

It is established beyond peradventure that the Commerce Clause of Art. I of the Constitution is a grant of plenary authority to Congress. That authority is, in the words of Mr. Chief Justice Marshall in Gibbons v. Ogden, 9 Wheat. 1 (1824), "the power to regulate; that is, to prescribe the rule by which commerce is to be governed." Id. at 196.

When considering the validity of asserted applications of this power to wholly private activity, the Court has made it clear that,

[e]ven activity that is purely intrastate in character may be regulated by Congress where the activity, combined with like conduct by others similarly situated, affects commerce among the...

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