tary relation, as clearly as is that between the members of a labor organization, the employer has the same inherent right to prescribe the terms upon which he will consent to the relationship, and to have them fairly understood and expressed in advance. When a man is called upon to agree not to become or remain a member of the union while working for a particular employer, he is in effect only asked to deal openly and frankly with his employer, so as not to retain the employment upon terms to which the latter is not willing to agree. And the liberty of making contracts does not include a liberty to procure employment from the unwilling employer, or without a fair understanding. Nor may the employer be foreclosed by legislation from exercising the same freedom of choice that is the right of the employee. To ask a man to agree, in advance, to refrain from affiliation with the union while retaining a certain position of employment, is not to ask him to give up any part of his constitutional freedom. He is free to decline the employment on those terms, just as the employer may decline to offer employment on any other; for "it takes two to make a bargain." Having accepted employment on those terms, the man is still free to join the union when the period of employment expires; or, if employed at will, then at any time upon simply quitting the employment. And, if bound by his own agreement to refrain from joining during a stated period of employment, he is in no different situation from that which is necessarily incident to term contracts in general. For constitutional freedom of contract does not mean that a party is to be as free after making a contract as before; he is not free to break it without accountability. Freedom of contract, from the very nature of the thing, can be enjoyed only by being exercised; and each particular exercise of it involves making an engagement which, if fulfilled, prevents for the time any inconsistent course of conduct. So much for the reason of the matter, let us turn again to the adjudicated cases. [The court quotes from the decisions of various State courts, in which acts similar to the one under consideration were held unconstitutional.] Upon both principle and authority, therefore, we are constrained to hold that the Kansas act of March 13, 1903, as construed and applied so as to punish with fine or imprisonment an employer or his agent for merely prescribing, as a condition upon which one may secure employment under or remain in the service of such employer, that the employee shall enter into an agreement not to become or remain a member of any labor organization while so employed, is repugnant to the "due process" clause of the 14th Amendment, and therefore void. Judgment reversed, and the cause remanded for further proceedings not inconsistent with this opinion. [Holmes, Day, and Hughes, J.J., dissented.] QUESTIONS 1. "It would be impossible to maintain that because one is free to accept or refuse a given employment, or because one may at will employ or refuse to employ another, it follows that the parties have a constitutional right to insert in an agreement of employment any stipulation they choose." you agree with this? 2. Do you agree with the court that the case is indistinguishable in principle from Adair v. United States-in that there is no material difference between a statute penalizing the discharge of employees because of membership in a labor union, and a statute penalizing an employer who requires, as a condition of securing employment, a promise not to become or remain a member of a union while in his employment? 3. "The statute is a protection of contractual freedom rather than an infringement of it." How would the court answer this? 4. "Wherein is the right of the employer to insert this stipulation in the agreement any more sacred than his right to agree with another employer in the same trade to keep up prices?" Discuss this question. 5. Why is not the removal of economic inequalities from the bargaining of employers and wage-earners a "matter of direct concern to the general welfare," so that legislation aimed at this goal would be justifiable as an exercise of the police power? 6. Could a state constitutionally make it a misdemeanor for an employer to discharge employees on account of race, color or previous condition of servitude? On account of membership in a particular church? 7. Would a state statute be constitutional if it provided that employees should not be required to agree, as a condition of employment, to forego affiliation with a particular political party? To forego the support of a particular candidate for President of the United States? To forego enlistment in the state militia? 8. A state law makes it a misdemeanor for labor unions to refuse to admit new members unless they agree not to work in open shops while members of the union. Is it constitutional? 9. Is there in your state a statute regulating anti-union contracts? If so, how has it been applied by the courts? (b) Among Employers ASSOCIATED HAT MANUFACTURERS v. BAIRD-UNTEIDT CO. Connecticut Supreme Court of Errors. 1914. 88 Conn. 332. [The plaintiff is a corporation including fifty-eight manufacturers of hats, organized to promote the interests of its members, reform abuses in the industry, "procure uniformity and certainty in the relations existing between employees and employers," and so forth. By its bylaws decisions and orders of the Association were binding upon its members, and failure to comply with them made a member liable to the Association in the amount of five thousand dollars, as liquidated damages. The defendant was a member of the Association and failed to maintain an "open shop" in his factory in conformity to a declaration of the Association. This was an action to recover five thousand dollars as damages for breach of the agreement.] WHEELER, J. The defendant claims this action must fail, since the plaintiff association is, because of its organization and its by-laws, illegal, and therefore its resolution, whose violation is the basis of the action, was invalid. The foundation of this claim is threefold, because (1) the real purpose and object of the Association was to permit it to order a suspension of work by its members; (2) to make agreements relative to the use of the union label; and (3), because the members of the plaintiff were engaged in inter-state commerce, the Association was a violation of the Sherman Act, as its purposes were in restraint of trade. . . . . The objects of the plaintiff association, as stated in its articles of association and by-laws, are most worthy. Neither they nor the finding show that the purpose of the Association was to permit it to order a suspension of work, and to agree in reference to the use of the union label. . . . . A by-law providing for a fine upon the members of either an employers' or a laborers' association, for disobedience of its lawful orders, is not unlawful. Each may involve coercion of its members: it may temporarily take away the livelihood of the employee; and it may injure, and if continued ruin, the business of the employer. Each member has agreed to this species of coercion in the belief that the common interest of all will best be served by the united action of many. Obedience to the lawful orders of the association is the condition of membership voluntarily encountered by previous assent to the by-laws. [The order in this case was] a declaration for the open shop. Its purpose was to preserve to employers the right to contract for their labor regardless of its membership in the union. The right to so contract is one of the inalienable rights of every employer of labor. Every employer and employee has under the law such freedom of contract. The law will not take it from him, much less declare illegal his effort to establish his right to it. . . . . We do not think it necessary to discuss the proposition that a vote by employers to conduct their factories as open shops, and to exercise their right to hire their labor as individuals and not as members of a labor union, is a restraint of trade within the Sherman Act. . . . The Superior Court is advised to render its judgment in favor of the plaintiff for $5,000, with interest from June 14th, 1909. Costs in this court will be taxed in favor of the plaintiff . QUESTIONS 1. Could the United Hatters have secured an injunction forbidding the members of the Association to carry out the open shop policy ordered by the Association? 2. Would an agreement among all employers of labor in a given city to *maintain the open shop be illegal at common law? 3. What is the difference between the "open shop" and the "employer's closed shop"? Would an agreement among employers to maintain the latter be illegal at common law? 4. Would an agreement among employers engaged in interstate commerce to maintain the open shop be illegal under the Sherman Act? 5. Would a statute prohibiting open-shop agreements among employers be constitutional? 6. A state statute makes it a misdemeanor for employers to enter into an agreement not to employ or retain in their employment men belonging to labor unions. Is it in violation of the Federal Constitution? 7. A state statute makes it a misdemeanor for anyone to coerce, induce, or seek to persuade an employer of union labor to enter into an agreement not to employ or retain in his employment men belonging to labor unions. Is it in violation of the Federal Constitution? 8. A state statute prohibits agreements in restraint of trade or commerce, or for the purpose of injuring anyone in his trade or business. Does it apply to an open-shop agreement among all the employers in a given industry in a large city? 9. Are anti-union contracts among employers legal in your state? C. ANTI-TRUST LAWS AND THE LABOR UNION I. APPLICABILITY OF ANTI-TRUST LAWS (a) Federal LOEWE v. LAWLOR United States Supreme Court. 1908. 208 U. S. 274. [The facts have been given in Lawlor v. Loewe, 235 U. S. 522, in section IV, B, I, supra.] MR. CHIEF JUSTICE FULLER delivered the opinion of the court: The case comes up, then, on complaint and demurrer. The question is whether upon the facts therein averred and admitted by the demurrer this action can be maintained under the Anti-Trust Act. In our opinion, the combination described in the declaration is a combination "in restraint of trade or commerce among the several States," in the sense in which those words are used in the act, and the action can be maintained accordingly. It is said, that the restraint alleged would operate to entirely destroy plaintiff's business and thereby include intrastate trade as well; that physical obstruction is not alleged as contemplated; and that defendants are not themselves engaged in interstate trade. We think none of these objections are tenable, and that they are dissposed of by previous decisions of this court. [The discussion of the first two objections is omitted.] Nor can the act in question be held inapplicable because defendants were not themselves engaged in interstate commerce. The act made no distinction between classes. It provided that "every" contract, combination or conspiracy in restraint of trade was illegal. The records of Congress show that several efforts were made to exempt, by legislation, organizations of farmers and laborers from the operation of the act and that all these efforts failed, so that the act remained as we have it before us. In an early case, United States v. Workingmen's Amalgamated Council, 54 Fed. Rep. 994, the United States filed a bill under the Sherman Act in the Circuit Court for the Eastern District of Louisiana, averring the existence of "a gigantic and widespread combination of the members of a multitude of separate organizations for the purpose |