United States v. Darby
The Court upheld the Fair Labor Standards Act of 1938, ruling that Congress can bar interstate shipment of goods made under substandard wages and hours, and can regulate the wages and hours of workers who make goods intended for interstate commerce.
In doing so, the Court explicitly overruled its 1918 decision in Hammer v. Dagenhart, clearing away a major obstacle to federal labor regulation and confirming that Congress's power over interstate commerce reaches production activities that substantially affect that commerce.
“It should be and now is overruled.”
The Court's declaration that its 1918 ruling in Hammer v. Dagenhart no longer stands as valid law.
How it got here: A federal district court in Georgia sustained the manufacturer's demurrer and threw out the indictment as unconstitutional; the government appealed directly to the Supreme Court.
The Case in Depth
What happened
A Georgia lumber manufacturer was indicted for shipping lumber made by workers paid less than the law's minimum wage or worked beyond its maximum hours without overtime pay, and for not keeping required wage-and-hour records. He argued Congress had no power to regulate wages and hours of workers making goods inside a state, even if the goods were later sold across state lines.
The question before the Court
Could Congress ban interstate shipment of goods made by workers paid below a federal minimum wage or worked beyond a federal maximum, and require employers to keep wage records?
The Court's answer
Yes — the Court ruled Congress can do both. It held that the commerce power lets Congress bar interstate shipment of goods made under substandard wages and hours, because the power to regulate commerce includes the power to prohibit it entirely, not just to assist or steer it.
The Court also upheld Congress's authority to directly regulate the wages, hours, and recordkeeping of workers who make goods intended for interstate commerce, even though that work happens entirely within one state. It reasoned that such local production substantially affects interstate commerce by enabling unfair competition, so Congress may regulate it as a necessary means of protecting that commerce — and in doing so, it overruled Hammer v. Dagenhart, which had held otherwise.
Curious how the Court got there? See the step-by-step legal reasoning →
Why it matters
The ruling cleared the way for nationwide federal wage-and-hour law, meaning businesses that ship goods across state lines have to pay a minimum wage and overtime, and keep records proving it, regardless of what their home state requires. It gave Congress much broader authority to regulate work done inside a single state whenever that work feeds into interstate commerce.
What changes now
The case is reversed, meaning the indictment against the lumber manufacturer is reinstated and the prosecution under the Fair Labor Standards Act can proceed. The decision is a final merits ruling that settles the constitutionality of the Act's wage, hour, and recordkeeping provisions, removing the major doctrinal barrier — Hammer v. Dagenhart — that had previously stood in the way of similar federal labor legislation.
What this does not decide
The Court did not attempt to define the precise outer limits of what counts as goods 'produced for' interstate commerce, and it left the specific numerical wage and hour standards to be worked out through the Act's ordinary administrative and enforcement processes rather than deciding them here.
How the Court got there
The legal reasoning, step by step
- The Court first asked whether Congress can bar goods from interstate commerce entirely, and held that the commerce power includes the power to prohibit shipments, not just to regulate or assist them — Congress may exclude any article from interstate commerce it judges harmful to the public, subject only to other constitutional limits.
- The Court then confronted its own 1918 precedent, Hammer v. Dagenhart, which had said Congress could not exclude child-labor-made goods from interstate commerce because the goods themselves were harmless. The Court found that reasoning irreconcilable with the broader principle that Congress's commerce power is plenary, and explicitly overruled it.
- Turning to the ban on employing workers below minimum wage or above maximum hours in making goods 'for' interstate commerce, the Court asked whether this intrastate activity was so connected to interstate commerce that regulating it was an appropriate means of protecting that commerce.
- The Court held that Congress may regulate purely local activity, including manufacturing, whenever that activity has a substantial effect on interstate commerce — here, substandard-wage production undercuts and disrupts fair competition among goods that do cross state lines.
- Because the wage-and-hour rule was a valid regulation of interstate commerce, the Court held the accompanying requirement that employers keep wage-and-hour records was also valid, as an appropriate tool for enforcing that regulation.
- The Court rejected the argument that the Tenth Amendment blocked this result, explaining that the amendment is merely a reminder that the federal government has only the powers it was given, not an independent limit once a power (here the commerce power) has in fact been granted.
Doctrinal impact
Cases affected by this decision
Overrules Hammer v. Dagenhart (247 U.S. 251)
The Court explicitly overruled this 1918 decision that had barred Congress from excluding child-labor goods from interstate commerce.
Limits Carter v. Carter Coal Co. (298 U.S. 238)
Its reasoning against regulating local production was limited to the extent it conflicted with Sherman Act and labor-law precedents.