NLRB v. Jones & Laughlin Steel Corp.

NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937), is a landmark decision of the United States Supreme Court.

The National Labor Relations Board found Jones & Laughlin Steel guilty of unfair labor practices and ordered it to reinstate discharged employees. The company challenged the National Labor Relations Act, arguing that its manufacturing operations were local and not subject to federal regulation under the Commerce Clause.

Significance

Chief Justice Hughes’s opinion upheld the NLRA, marking a decisive shift in Commerce Clause jurisprudence. The Court held that labor disputes at a major steel company, even if local in origin, could have a ‘close and substantial relation’ to interstate commerce. This ‘substantial effects’ test replaced the direct/indirect distinction and provided constitutional foundation for the modern regulatory state. The decision signaled the end of the Court’s resistance to New Deal legislation and is known as ’the switch in time that saved nine.’

Category

US Federal Case Law