The Fair Labor Standards Act (FLSA) has provided U.S. workers with essential protections since 1938. While many of us take for granted the right to earn a minimum wage (insufficient as it may be for many), earn overtime pay when we work long hours, and have a childhood that’s dedicated to learning rather than participating in the labor force, the path to achieving these basic employment rights was difficult and uncertain.
U.S. Labor Law in the Early 20th Century
While the dire conditions of the Great Depression paved the way for the eventual adoption of the FLSA, the fight for workers’ rights to fair pay and safe working conditions began well before the depression began in 1929. However, a Supreme Court that was inclined to view such limits on free enterprise to be unconstitutional struck down early efforts. For example,
In 1905, in the landmark case of Lochner v. New York, the Supreme Court ruled that a New York law that set maximum working hours for bakers interfered with individual liberty and property without due process of law, in violation of the 14th This precedent set the stage for a long and difficult struggle to establish basic legal rights for workers.
In 1918, the Court struck down a federal law that prohibited trade in goods produced in factories that violated its child-labor standards, including not employing children younger than 14 and limiting the work schedules of children younger than 17. The Court determined Congress had overstepped its constitutional authority and “invade[d] powers reserved to the states.”
In 1923, it invalidated a Washington, D.C. statute that established a minimum wage for women, citing “unconstitutional interference with the freedom of contract.”
Effects of the Great Depression
As the Great Depression took hold, workers and businesses alike suffered. The stock market crash that followed massive speculative investment resulted in a dramatic decline in business values, which fueled levels of unemployment that our nation hasn’t seen since. For perspective, consider that the unemployment rate in 1929 (3.2%) was similar to what we were seeing in early 2020 (3.5%). The peak unemployment rate during the COVID epidemic was 14.7% in April 2020 and had fallen to under 7% by October of that year. By July 2022, pre-COVID unemployment rates had returned.
Following the stock market crash of 1929, unemployment climbed sharply for years, averaging nearly 25% in 1933. While New Deal initiatives helped to bring this down over the next several years, it wasn’t until 1940 that unemployment fell below the peak levels experienced during COVID, and they didn’t return to 1929 levels until after the U.S. entered World War II. This prolonged period of hardship was the backdrop for President Franklin Delano Roosevelt’s New Deal initiatives, including the creation of the Social Security Administration, public works programs, and passage of the National Industrial Recovery Act (NIRA), which sought “to encourage national industrial recovery, to foster fair competition, and to provide for the construction of certain useful public works….”
The New Deal Fight
Under NIRA, President Roosevelt initiated the President’s Reemployment Agreement, aimed at helping to restore the economy by raising wages and increasing employment. Businesses agreed to limit working hours, guarantee a minimum wage, and enforce specific limits on the employment of minors. In return, participating businesses were allowed to display a Blue Eagle logo that advertised their commitment to fair labor practices, and patriotic consumers were encouraged to reward these businesses with their patronage. Industries also began to develop their own labor codes, such as the Cotton Textile Code, which imposed similar limitations on employment.
In 1935, however, in the case of Schechter Corp. v. U.S., a New York slaughterhouse challenged these limits on its power to set employee wages and hours. The Supreme Court declared key provisions of NIRA to be unconstitutional, favoring the same types of arguments that led to the invalidation of earlier labor laws. A series of similar decisions followed, impeding progress in workers’ rights until 1937, when the Court changed course in another landmark case.
The End of an Era—and the Beginning of the FLSA
West Coast Hotel Co. v. Parrish marked the end of what became known as the Lochner era by upholding a Washington state statute that set a minimum wage for women and declaring it does not violate the Constitution’s due process protections. Interestingly, the Court’s opinion emphasizes the interest of the state in protecting women’s health because it is “peculiarly related to the vigor of the race” and reasons that “women are especially liable to be overreached and exploited by unscrupulous employers,” thus meriting state protection.
President Roosevelt worked with Labor Secretary Frances Perkins (the first female Cabinet member in the U.S.) to create the Fair Labor Standards Act. The final version was signed into law in 1938, establishing the first federal minimum wage and limits on weekly work hours and the use of child labor, which had become pervasive since the Industrial Revolution. The minimum wage was initially set at 25 cents per hour (equivalent to $5.41 in 2023) with a scheduled increase to 30 cents (about $6.59 in 2023 dollars) in 1939. In 2023, the FLSA guarantees the employees it covers a minimum wage of $7.25 per hour. While this looks good compared to the 1930s, the rate has remained unchanged since 2009. If the federal minimum wage had risen on pace with inflation, it would be $10.31 in 2023.
Enforcing Labor Rights Today
Fortunately for millions of workers, many states, including New Jersey, provide additional protections that go above and beyond the minimum labor standards set forth in the FLSA. Workers who are subject to unfair working conditions can seek relief using a tapestry of federal, state, and local regulations designed to safeguard their basic rights. With an array of protections and potential remedies, however, it’s not always easy for workers to determine the best way to assert their rights.
An experienced employment attorney is an invaluable ally in navigating these legal complexities. They can help you understand what laws apply to your employment situation, ensure all filings are made properly and on time, and build the strongest possible case for the relief you deserve. The attorneys at the Mark Law Firm have proven expertise in New Jersey and federal employment law, including wage and hour claims, workplace discrimination, and workers’ compensation. To learn more about your rights at work, subscribe to our blog.