Adams v. Tanner

Background

A group of private employment agencies in Spokane sued Washington officials after Initiative Measure No. 8 made it unlawful to charge any person seeking work a fee for finding employment or giving employment information. The agencies argued the law violated their Fourteenth Amendment liberty to earn a living. Lower courts denied relief and dismissed the suit, and the agencies appealed to the High Court.

Reasoning

The central question was whether the fee ban was a valid exercise of the state's power to protect workers or an unconstitutional prohibition on a useful business. The Court, speaking for the majority, said acting as a paid representative to find work is a legitimate, useful calling and that the statute operates as a prohibition, not mere regulation. As interpreted by Washington’s courts, the measure was arbitrary and oppressive and unduly restricted the agencies’ Fourteenth Amendment liberty to pursue a lawful business. The Court therefore held the law could not be enforced against these agencies and reversed and remanded for further proceedings.

Real world impact

The ruling prevents enforcement of Washington’s fee ban against the private agencies in this case and protects their ability to continue fee-based placement. It also signals that a State cannot simply abolish a useful occupation by broad prohibition unless the law has a real, substantial relation to public welfare. The decision was reached over vigorous disagreement among the Justices.

Dissents or concurrances

Justice Brandeis (joined by Justices Holmes and Clarke) and Justice McKenna dissented, arguing the statute responded to extensive evidence of fraud, extortion, and unemployment problems and represented a valid exercise of the State’s power to protect workers.