What was NLRB v. Jones in 1937?

This case was one of the most important cases in Supreme Court
history. It was the famous "switch in time that saved nine" (because it helped to diffuse any
momentum towards FDR's court packing plan). This was the case in which the Court abandoned its
doctrine of "substantive due process" and began to allow the federal government broader powers to
regulate the economy based on Congress's constitutional right to regulate interstate
commerce.

In 1935, Congress passed the Wagner Act which gave many
protections to labor unions and union members. The Jones & Laughlin Steel Corporation
fired a number of workers for trying to unionize. The workers
sued.

Historically, the Supreme Court had said that the 5th and 14th
Amendments protected the right of workers and employers to make any contracts they wanted to
between themselves. In other words, they could make contracts for any amount of pay (so minimum
wage laws were illegal) or any amount of hours worked (so maximum hours laws were illegal).
Similarly, they could make contracts banning union activity. This was seen as part of their
liberty and could not be taken away without due process of the
law.

In this case, the Court reversed this reasoning. It held,
instead, that laws regulating labor relations were legal because of the interstate commerce
clause. It stopped using the idea that such laws were illegal under the due process clauses of
the 5th and 14th Amendments. This allowed not only the New Deal programs but also has allowed the
much more extensive set of government regulations that exist today.