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The right to contract ones labor is at the "liberty of the individual" and the State cannot interfere by passing a statute limiting a persons ability to contract. However, the State may still have a legitimate reason to regulate certain industries if the health of the employees is at risk.
The State of New York enacted a statutes which restricted employers from allowing employees to work more than 10 hours a day or 60 hours a week. The State Supreme Court found that Lochner violated a New York labor law. The employer allowed his employee, a baker, to work more than 60 hours in one week. The State Supreme Court upheld the labor law as a constitutional exercise of the state's police power. The case was appealed to the Supreme Court of the United States.
Does the Statute limiting employees hours constitute a legitimate exercise of state police powers?
The labor law that was enacted was not a legitimate exercise of the police power of the State, but an unreasonable, unnecessary and arbitrary interference with the right and liberty of the individual to contract, in relation to labor, and as such it is in conflict with, and void under, the Federal Constitution.
The statute was not necessary as a health law to safeguard the public health or the health of the individuals who labored as bakers. The trade of a baker was not an unhealthy one to such a degree that would authorize the legislature to interfere with the right to labor and the right of free contract on the part of the individual. Various regulations already governed the cleanliness of the quarters in which bakeries were to be conducted. Restricting the number of hours that a baker could work would not further the purpose of those regulations. It was not possible to discover the connection between the number of hours a baker could work and the quality of the bread that he produced.