States have power to legislate against what are found to be injurious practices in their internal commercial and business affairs, so long as their laws do not run afoul of some specific federal constitutional prohibition or of some valid federal law. Under this constitutional doctrine the due process clause is no longer to be so broadly construed that the Congress and state legislatures are put in a strait jacket when they attempt to suppress business and industrial conditions which they regard as offensive to the public welfare.
A North Carolina statute and a Nebraska constitutional amendment provide that no one be denied an opportunity to obtain or retain employment because he is or is not a member of a labor organization, and prohibits employers from entering into contracts or agreements obligating themselves to exclude persons from employment because they are or are not labor union members. Employers and labor unions challenged the statute and constitutional amendment, claiming that the laws violated U.S. Const. amend. I and XIV, by impairing their freedom of speech and assembly, and by depriving them of equal protection and due process of law guaranteed against state invasion.
Are the statute and constitutional amendment violative of U.S. Const. amend. I and XIV?
The U.S. Supreme Court ruled that the laws did not violate the U.S. Constitution since there was no stated purpose or effect of limiting speech, assembly, or petition. The Court noted that the right to assemble as a union did not create a constitutional guarantee that only those who joined or agreed to abide by the union's plans could obtain employment. The Court also ruled that the laws did not violate the equal protection clause, since the language in the state laws forbade employers from discriminating against both union and non-union members.