1. The National Labor Relations Act is applicable to
manufacturers whose product is shipped in interstate commerce under
circumstances such that cessation of work by their employees by
reason of strikes or labor disputes would result in cessation of
the movement of the manufactured product in interstate commerce.
Consequently the Act is applicable to employers, not themselves
engaged in interstate commerce, who are engaged in a relatively
small business of processing materials which are regularly
transmitted to them by the owners through the channels of
interstate commerce and which, after the processing, are returned
to the owner's agent at the factory, and by him shipped to
interstate destinations. P. 306 U. S.
2. Whether the materials are owned by the processor and whether
they are shipped directly to him or to representatives of the
owners at the processor's factory are immaterial. The shipments to
and from the factory are none the less interstate commerce because
the transportation did not begin or end with the transfer of title
of the merchandise transported. P. 306 U.S. 605
3. The power of Congress to regulate interstate commerce is
plenary, and extends to all such commerce, be it great or small.
The amount of commerce regulated is of special significance only to
the extent that Congress may be taken to have excluded commerce of
small volume from the operation of its regulatory measure by
express provision or fair implication. P. 306 U.S. 606
4. In the National Labor Relations Act Congress has set no
restrictions upon the jurisdiction of the Board to be determined or
fixed exclusively by reference to the volume of interstate commerce
involved. P. 306 U.S.
98 F.2d 615 reversed.
Certiorari, 305 U.S. 594, to review a judgment denying a
petition of the National Labor Relations Board for enforcement of
one of its orders.
Page 306 U. S. 602
MR. JUSTICE STONE delivered the opinion of the Court.
This petition raises the question whether the National Labor
Relations Act is applicable to employers, not themselves engaged in
interstate commerce, who are engaged in a relatively small business
of processing materials which are transmitted to them by the owners
through the channels of interstate commerce and which, after
processing, are distributed through those channels.
Pursuant to § 10(b) of the National Labor Relations Act, 49
Stat. 449, 29 U.S.C. § 151 et seq.,
the National Labor
Relations Board issued its complaint charging respondents with
unfair labor practices in violation of § 8(1), (3), (5) and § 2(6),
(7) of the Act. After a hearing, which resulted in a decision and
order of the Board, a supplemental hearing was held pursuant to
order of the Court of Appeals for the Third Circuit, which resulted
in a supplemental decision and an order reaffirming the Board's
original findings and conclusions of law and modifying the original
order in one respect not now material.
The facts, as found by the Board, are that respondents, under
the name of Somerset Manufacturing Company, are engaged at
Somerville, New Jersey, in the business of processing materials
into various types of women's sports garments. They operate what is
known as a "contract shop." The materials are supplied by and are
the property of the Lee Sportswear Company, a partnership
Page 306 U. S. 603
located in New York City. The cloth from which the garments are
made is usually cut by the Lee Sportswear Company in New York City
and then shipped by truck to respondents' factory in New Jersey.
Sometimes the raw materials are shipped, on the order of the Lee
Sportswear Company, directly from the mills manufacturing them,
many of which are outside of New Jersey. All the materials are
manufactured at respondents' New Jersey factory under contract. The
finished garments are there delivered to a representative of the
Lee Sportswear Company, who ships them to the company in New York
City or directly to its customers throughout the United States.
Throughout the year, there is normally a continuous day-by-day
flow of shipments of raw materials to respondents' factory from
points without the state, and of finished garments from
respondents' plant to New York City and other points outside of New
Jersey. During the years 1934 and 1935, respondents appear to have
finished more than a thousand dozen garments each month. In the
course of the supplemental hearing in 1937, it appeared that
respondents had increased their working force from sixty to
approximately two hundred employees, from which the Board inferred
a corresponding increase of output. Immediately preceding a strike
of thirty-four of the workers in respondents' tailoring department,
which occurred in September, 1935, and which the Board found to be
induced by the unfair labor practices of respondents, shipments
were about 80 percent of those for the corresponding period in
1934. Following the strike, output decreased by more than one-half,
or to 38 percent of the shipments for the corresponding period in
The Board concluded that respondents' unfair labor practices had
led and tended "to lead to labor disputes burdening and obstructing
commerce and the free flow of commerce." Its order, as modified,
directed respondents to desist from interfering with their
employees' right to
Page 306 U. S. 604
join a local union and from discouraging membership in the union
by discharging them or discriminating against them in the terms of
their employment, and it directed respondents to reinstate certain
employees who had struck because of the unfair labor practices,
some with back pay.
The Board's petition for enforcement of its order was denied by
the Court of Appeals for the Third Circuit, 98 F.2d 615, on the
ground that respondents were not themselves engaged in interstate
commerce, and had no title or interest in the raw materials or
finished products which moved to and from respondents' factory in
New Jersey from and to points outside the state. We granted
certiorari January 9, 1939, the question being one of public
importance in the administration of the National Labor Relations
Only the question of the Board's jurisdiction is raised by the
petition and in briefs and argument. It has been settled by
repeated decisions of this Court that an employer may be subject to
the National Labor Relations Act although not himself engaged in
commerce. The end sought in the enactment of the statute was the
prevention of the disturbance to interstate commerce consequent
upon strikes and labor disputes induced or likely to be induced
because of unfair labor practices named in the Act. That those
consequences may ensue from strikes of the employees of
manufacturers who are not engaged in interstate commerce where the
cessation of manufacture necessarily results in the cessation of
the movement of the manufactured product in interstate commerce has
been repeatedly pointed out by this Court. Labor Board v. Jones
& Laughlin Steel Corp., 301 U. S. 1
301 U. S. 38
Labor Board v. Fruehauf Trailer Co., 301 U. S.
; Labor Board v. Friedman-Harry Marks Clothing
Co., 301 U. S. 58
Santa Cruz Packing Co. v. Labor Board, 303 U.
, 303 U. S. 463
et seq.; cf. 306 U. S. S.
Edison Co. v. Labor Board,@ 305 U.
. Long before the enactment of the National Labor
Relations Act, it had been many times held by this Court that the
power of Congress extends to the protection of interstate commerce
from interference or injury due to activities which are wholly
intrastate. [Footnote 1
Here, interstate commerce was involved in the transportation of
the materials to be processed across state lines to the factory of
respondents and in the transportation of the finished product to
points outside the state for distribution to purchasers and
ultimate consumers. Whether shipments were made directly to
respondents, as the Board found, or to a representative of Lee
Sportswear Company at the factory, as respondents contend, is
immaterial. It was not any the less interstate commerce because the
transportation did not begin or end with the transfer of title of
the merchandise transported. See Santa Cruz Packing Co. v.
Labor Board, supra, 303 U. S. 463
cf. 114 U. S. v.
Page 306 U. S. 606
114 U. S. 196
114 U. S. 203
Wabash, St.L. & P. Ry. Co. v. Illinois, 118 U.
; Hanley v. Kansas City Southern Ry. Co.,
187 U. S. 617
187 U. S. 619
Morf v. Bingaman, 298 U. S. 407
Ingels v. Morf, 300 U. S. 290
Transportation alone across state lines is commerce within the
constitutional control of the national government, and subject to
the regulatory power of Congress. Gibbons v.
9 Wheat 1; Champion v. Ames,
188 U. S. 321
Nor do we think it important, as respondents seem to argue, that
the volume of the commerce here involved, though substantial, was
relatively small as compared with that in the cases arising under
the National Labor Relations Act which have hitherto engaged our
attention. The power of Congress to regulate interstate commerce is
plenary, and extends to all such commerce, be it great or small.
Hanley v. Kansas City Southern Ry. Co., supra.
exercise of Congressional power under the Sherman Act, the Clayton
Act, the Federal Trade Commission Act, or the National Motor
Vehicle Theft Act has never been thought to be constitutionally
restricted because, in any particular case, the volume of the
commerce affected may be small. The amount of the commerce
regulated is of special significance only to the extent that
Congress may be taken to have excluded commerce of small volume
from the operation of its regulatory measure by express provision
or fair implication.
The language of the National Labor Relations Act seems to make
it plain that Congress has set no restrictions upon the
jurisdiction of the Board to be determined or fixed exclusively by
reference to the volume of interstate commerce involved. Section
2(6) defines commerce as "trade, traffic, commerce, transportation,
or communication among the several States," without reference to
its volume, and declares in subsection (7) that
"The term 'affecting commerce' means in commerce, or burdening
or obstructing commerce or the free flow of commerce, or
Page 306 U. S. 607
having led or tending to lead to a labor dispute burdening or
obstructing commerce or the free flow of commerce."
Section 10(a) confers on the Board authority "to prevent any
person from engaging in any unfair labor practice (listed in
section 158) affecting commerce."
The Act, on its face, thus evidences the intention of Congress
to exercise whatever power is constitutionally given to it to
regulate commerce by the adoption of measures for the prevention or
control of certain specified acts -- unfair labor practices --
which provoke or tend to provoke strikes or labor disturbances
affecting interstate commerce. Given the other needful conditions,
commerce may be affected in the same manner and to the same extent
in proportion to its volume, whether it be great or small.
Examining the Act in the light of its purpose and of the
circumstances in which it must be applied, we can perceive no basis
for inferring any intention of Congress to make the operation of
the Act depend on any particular volume of commerce effected more
than that to which courts would apply the maxim de
There are not a few industries in the United States which,
though conducted by relatively small units, contribute in the
aggregate a vast volume of interstate commerce. [Footnote 2
] Some, like the clothing industry,
are extensively unionized, and have had a long and tragic history
of industrial strife. It is not to be supposed that Congress, in
its attempted nationwide regulation of interstate commerce through
the removal of the causes of industrial
Page 306 U. S. 608
strife affecting it, intended to exclude such industries from
the sweep of the Act. In this as in every other case, the test of
the Board's jurisdiction is not the volume of the interstate
commerce which may be affected, but the existence of a relationship
of the employer and his employees to the commerce such that, to
paraphrase § 10(a) in the light of constitutional limitations,
unfair labor practices have led or tended to lead "to a labor
dispute burdening or obstructing commerce."
It is no longer open to question that the manufacturer who
regularly ships his product in interstate commerce is subject to
the authority conferred on the Board with respect to unfair labor
practices whenever such practices on his part have led or tend to
lead to labor disputes which threaten to obstruct his shipments.
Labor Board v. Jones & Laughlin Steel Corp., supra; Labor
Board v. Fruehauf Trailer Co., supra; Labor Board v. Friedman-Harry
Marks Clothing Co., supra; Santa Cruz Packing Co. v. Labor Board,
supra; Consolidated Edison Co. v. Labor Board, supra.
cannot say, other things being equal, that the tendency differs in
kind, quantity, or effect merely because the merchandise which the
manufacturer ships, instead of being his own, is that of the
consignee or his customers in other states. In either case,
commerce is in danger of being obstructed in the same way and to
the same extent.
Here, although respondents' manufacturing business is small,
employing from sixty to two hundred employees, its product is
regularly shipped in interstate commerce. The Board's finding that
respondents' unfair labor practices have led and tend to lead to
labor disputes burdening interstate commerce and interfering with
its free flow is supported by the evidence. Moreover, the Board has
found specifically that respondents' unfair labor practices in
attempting to prevent the unionization of their factory
Page 306 U. S. 609
did in fact lead to a strike in respondents' tailoring
establishment, with a consequent reduction of about 50 percent in
respondents' output. These findings are not challenged.
The threatened consequences to interstate commerce are as
immediate and as certain to flow from respondents' unfair labor
practices as were those which were held to result from unfair labor
practices in Labor Board v. Jones & Laughlin Steel Corp.,
supra; Labor Board v. Fruehauf Trailer Co., supra; Labor Board v.
Friedman-Harry Marks Clothing Co., supra; Santa Cruz Packing Co. v.
Labor Board, supra; Consolidated Edison Co. v. Labor Board,
That the volume of commerce affected is smaller than in
other cases in which the jurisdiction of the Board has been upheld,
for reasons already stated, is, in itself, without
It may prohibit wholly intrastate activities which, if
permitted, would result in restraint of interstate commerce.
Coronado Coal Co. v. United Mine Workers, 268 U.
, 268 U. S. 310
Bedford Cut Stone Co. v. Stone Cutters Assn., 274 U. S.
, 274 U.S. 46
Local 167 v. United States, 291 U.
, 291 U. S. 297
It may regulate the activities of a local grain exchange shown to
have an injurious effect on interstate commerce. Chicago Board
of Trade v. Olsen, 262 U. S. 1
. It may
regulate intrastate rates of interstate carriers where the effect
of the rates is to burden interstate commerce. Houston, E.
& W. Texas Ry. Co. v. United States, 234 U.
; Railroad Commission of Wisconsin v. Chicago,
B. & Q. R. Co., 257 U. S. 563
United States v. Louisiana, 290 U. S.
, 290 U. S. 74
Florida v. United States, 292 U. S.
. It may compel the adoption of safety appliances on
rolling stock moving intrastate because of the relation to and
effect of such appliances upon interstate traffic moving over the
same railroad. Southern Ry. Co. v. United States,
222 U. S. 20
may prescribe maximum hours for employees engaged in intrastate
activity connected with the movement of any train, such as train
dispatchers and telegraphers. Baltimore & Ohio R. Co. v.
Interstate Commerce Comm'n, 221 U. S. 612
221 U. S.
In the year 1933, the women's clothing industry ranked ninth
among manufacturing industries in number of workers employed and
eighth in value of product. U.S. Biennial Census of Manufactures
(Commerce Dept., 1933). In this industry, the "contract shop" is
common. About one-half of the 3,414 enterprises engaged in 1935 in
the manufacture of women's dresses were "contract shops." U.S.
Biennial Census of Manufactures (Commerce Dept., 1935). These
enterprises employed an average of only about thirty-two employees
MR. JUSTICE McREYNOLDS, dissenting.
MR. JUSTICE BUTLER and I conclude that the challenged judgment
should be affirmed.
Respondent, Benjamin Fainblatt, as sole owner, conducts a small
plant for manufacturing wearing apparel located at Somerville, New
Jersey, where he employs some sixty women. There he receives
material belonging to Lee Sportswear Company of New York and, under
contract, converts this into garments. These are delivered to the
company's representative, and payment is made for the work done.
The owner sends the finished products to New York.
The Labor Board claims jurisdiction in respect of employment at
this establishment upon the theory that the material and garments
move in interstate commerce;
Page 306 U. S. 610
that disapproved labor practices there may lead to disputes;
that these may cause a strike; that this may reduce the factory
output; that, because of such reduction, less goods may move across
the state lines; and thus there may come about interference with
the free flow of commerce between the states which Congress has
power to regulate. So, it is said, to prevent this possible result,
Congress may control the relationship between the employer and
those employed. Also, that the size of the establishment's normal
output is of minor or no importance. If the plant presently
employed only one woman who stitched one skirt during each week
which the owner regularly accepted and sent to another state,
Congressional power would extent to the enterprise, according to
the logic of the Court's opinion.
Manifestly, if such attenuated reasoning -- possibility massed
upon possibility -- suffices, Congress may regulate wages, hours,
output, prices, etc., whenever any product of employed labor is
intended to pass beyond state lines -- possibly if consumed next
door. Producers of potatoes in Maine, peanuts in Virginia, cotton
in Georgia, minerals in Colorado, wheat in Dakota, oranges in
California, and thousands of small local enterprises become subject
to national direction through a Board.
Of course, no such result was intended by those who framed the
Constitution. If the possibility of this had been declared, the
Constitution could not have been adopted. So construed, the power
to regulate interstate commerce brings within the ambit of federal
control most if not all activities of the Nation, subjects states
to the will of Congress, and permits disruption of our federated
Kidd v. Pearson, 128 U. S. 1
128 U. S. 20
lucidly pointed out the necessary result of this subversive
doctrine, showed how it had long been authoritatively rejected, and
demonstrated its utter absurdity. A few
Page 306 U. S. 611
paragraphs from that opinion may quicken estimation of what now
"We think the construction contended for by plaintiff in error
would extend the words of the grant to congress, in the
constitution, beyond their obvious import, and is inconsistent with
its objects and scope. The language of the grant is, 'Congress
shall have power to regulate commerce with foreign nations and
among the several states,' etc. These words are used without any
veiled or obscure signification."
"As men whose intentions require no concealment generally employ
the words which most directly and aptly express the ideas they tend
to convey, the enlightened patriots who framed our constitution,
and the people who adopted it, must be understood to have employed
words in their natural sense, and to have intended what they have
"Gibbons v. Ogden, supra,
at page 22 U. S.
"No distinction is more popular to the common mind, or more
clearly expressed in economic and political literature, than that
between manufacturers and commerce. Manufacture is transformation
-- the fashioning of raw materials into a change of form for use.
The functions of commerce are different. The buying and selling and
the transportation incidental thereto constitute commerce; and the
regulation of commerce in the constitutional sense embraces the
regulation at least of such transportation. The legal definition of
the term, as given by this court in County of Mobile v.
Kimball, 102 U. S. 691
, is as
"commerce with foreign countries, and among the states, strictly
considered, consists in intercourse and traffic, including in these
terms navigation and the transportation and transit of persons and
property, as well as the purchase, sale, and exchange of
"If it be held that the term includes the regulation of all such
manufactures as are intended to be the subject of commercial
transactions in the future, it is impossible to deny
Page 306 U. S. 612
that it would also include all productive industries that
contemplate the same thing. The result would be that congress would
be invested, to the exclusion of the states, with the power to
regulate not only manufacture, but also agriculture, horticulture,
stock-raising, domestic fisheries, mining -- in short, every branch
of human industry. For is there one of them that does not
contemplate, more or less clearly, an interstate or foreign market?
Does not the wheat grower of the northwest, and the cotton planter
of the south, plant, cultivate, and harvest his crop with an eye on
the prices at Liverpool, New York, and Chicago? The power being
vested in congress and denied to the states, it would follow as an
inevitable result that the duty would devolve on congress to
regulate all of these delicate, multiform, and vital interests --
interests which, in their nature, are and must be local in all the
details of their successful management."
The doctrine approved in Kidd v. Pearson
has been often
applied. I t was the recognized view of this Court for more than a
United States v. E. C. Knight Co., 156 U. S.
, 156 U. S. 16
"Slight reflection will show that, if the national power extends
to all . . . productive industries whose ultimate result may affect
external commerce, comparatively little of business operations and
affairs would be left for state control."
Oliver Iron Mining Co. v. Lord, 262 U.
, 262 U. S.
"Mining is not interstate commerce, but, like manufacturing, is
a local business, subject to local regulation and taxation. . . .
Its character in this regard is intrinsic, is not affected by the
intended use or disposal of the product, is not controlled by
contractual engagements, and persists even though the business be
conducted in close connection with interstate commerce."
Schechter Poultry Corp. v. United States, 295 U.
, 295 U. S. 546
295 U. S.
Page 306 U. S. 613
"If the commerce clause were construed to reach all enterprises
and transactions which could be said to have an indirect effect
upon interstate commerce, the federal authority would embrace
practically all the activities of the people, and the authority of
the state over its domestic concerns would exist only by sufferance
of the federal government. . . . The distinction between direct and
indirect effects of intrastate transactions upon interstate
commerce must be recognized as a fundamental one, essential to the
maintenance of our constitutional system. . . . If the federal
government may determine the wages and hours of employees in the
internal commerce of a state . . . , it would seem that a similar
control might be exerted over other elements of cost also affecting
prices, such as the number of employees, rents, advertising,
methods of doing business, etc. All the processes of production and
distribution that enter into cost could likewise be controlled. . .
. But the authority of the federal government may not be pushed to
such an extreme as to destroy the distinction, which the commerce
clause itself establishes, between commerce 'among the several
States' and the internal concerns of a state. . . . The
recuperative efforts of the federal government must be made in a
manner consistent with the authority granted by the
Carter v. Carter Coal Co., 298 U.
, 298 U. S. 303
298 U. S.
"Plainly, the incidents leading up to and culminating in the
mining of coal do not constitute such intercourse. The employment
of men, the fixing of their wages, hours of labor, and working
conditions, the bargaining in respect of these things -- whether
carried on separately or collectively -- each and all constitute
intercourse for the purposes of production, not of trade. . . . The
government's contentions in defense of the labor provisions are
really disposed of adversely by our decision in the
Page 306 U. S. 614
case. . . . There is no basis in law or
reason for applying different rules to the two situations."
The present decision and the reasoning offered to support it
will inevitably intensify bewilderment. The resulting curtailment
of the independence reserved to the states and the tremendous
enlargement of federal power denote the serious impairment of the
very foundation of our federated system. Perhaps the change of
direction, no longer capable of concealment, will give potency to
the efforts of those who apparently hope to end a system of
government found inhospitable to their ultimate designs.