Conceptions of Fairness and the Fair Labor Standards Act
148 Pages Posted: 23 Apr 2004
This article uses the history of the Fair Labor Standards Act's minimum wage provisions to examine how statutes that benefit interests that are comparatively weak in the political market become law. The article tracks the history of the American debate over fairness in wages beginning with the demise of slavery through the passage of the Fair Labor Standards Act in 1938 in search of an answer.
The search yields two answers. The first answer is that bargaining power is dynamic, not static. The article discusses the socio-economic crises and effective political advocacy by living wage proponents that changed the political bargaining calculus. It also discusses the normative approaches to fairness in wages - that is, conceptions of fairness - offered to remedy the ill effects of employers' superior bargaining power in the labor market and how they rose and fell with the changing political environment.
In particular, the article discusses how the "Fairness is a Living Wage" conception ("Absolute Fairness") would have required employers to pay each worker at least a wage sufficient to support a family while "Fairness is Equality of Bargaining Power" ("Bargaining Fairness") would have imposed the procedural remedy of "public bargaining" over wages and hours in hopes that subsistence wages would result.
A vigorous Spencerist majority on the Supreme Court used its own conception of fairness in wages, "Fairness is the Economic Hierarchy" ("Hierarchic Fairness"), to block state laws codifying the conception of Bargaining Fairness and preserve the economic status quo. The pre-FLSA debate over fairness in wages was largely a struggle between Bargaining Fairness and Hierarchic Fairness.
The article also introduces the conception that "Fairness is Fair Competition" ("Competitive Fairness") which would prohibit some low wages and excessive hours as a means to fairness between employers, not as a means to fairness for workers. The FLSA codified this conception of Competitive Fairness and thereby offered a second answer to the question of how a statute that benefits politically disempowered people became law. The FLSA also benefits politically empowered employers.
Since passage of the FLSA, the courts have reentered the debate over fairness in wages through the debate over which workers are "employees" entitled to the FLSA's protections. In essence, the courts have abandoned Competitive Fairness. Courts hold that only those workers who are "dependent" on their employers are entitled to the minimum wage protections guaranteed by the FLSA. This artificial threshold amounts to a rejection of the long-standing consensus that workers in the low-wage labor market lack sufficient individual bargaining power to protect themselves against employers' wage demands. This judicial construct reflects a sixth conception of fairness extant, but hidden, in the current judicial interpretation of the FLSA's definition of "employee." The article argues that "Fairness is an Implied Contract" is wholly inconsistent not only with the entire history of the American debate over fairness in wages that preceded the FLSA, but with the purpose and structure of the FLSA itself. It also discusses courts' role in the political balance between stronger and weaker parties in the political market.
Keywords: Fair Labor Standards Act, Minimum wage, maximum hours, labor history, fairness, wages, AFL, CIO, protective legislation, New Deal, Statutory interpretation
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