The United States Constitution does not speak of freedom of contract. It speaks of liberty and prohibits the deprivation of liberty without due process of law. In prohibiting that deprivation the Constitution does not recognize an absolute and uncontrollable liberty. Liberty in each of its phases has its history and connotation. But the liberty safeguarded is liberty in a social organization which requires the protection of law against the evils which menace the health, safety, morals and welfare of the people. Liberty under the Constitution is thus necessarily subject to the restraints of due process, and regulation which is reasonable in relation to its subject and is adopted in the interests of the community is due process.
The Act, entitled "Minimum Wages for Women," authorizes the fixing of minimum wages for women and minors. Further provisions required the Industrial Welfare Commission to ascertain the wages and conditions of labor of women and minors within the State. Public hearings were to be held. If after investigation the Commission found that in any occupation, trade or industry the wages paid to women were "inadequate to supply them necessary cost of living and to maintain the workers in health," the Commission was empowered to call a conference of representatives of employers and employees together with disinterested persons representing the public. It became the duty of the Commission to issue an obligatory order fixing minimum wages. A chambermaid filed suit against her employer, a hotel, to recover the difference between the wages paid her and the minimum wage fixed pursuant to the state law. The minimum wage was $ 14.50 per week of 48 hours. The employer challenged the act as repugnant to due process. The Supreme Court of the State, reversing the trial court, sustained the statute and directed judgment for the plaintiffs.
Was the Act unconstitutional for violating due process?
The Supreme Court held that the Act did not violate the Due Process Clause of the Fourteenth Amendment because it was a valid exercise of the state's police power to protect the health and safety of women. The Court reasoned that the state had a valid interest in the wages paid to women because their support would fall on the state if women were not paid adequate wages. The Court specifically overruled a case relied on by the employer which held that minimum wages laws for women were an unconstitutional burden on the right to contract. The Court reasoned that the case could not stand because employers and employees did not stand on equal footing in the contract process, and the state's interest in the protection of women was valid. The Court held that equal protection was not violated because there was no doctrinal requirement that the legislation to be couched in all-embracing terms. The Act was directed at a social position unique to women, so the Act did not constitute arbitrary discrimination.