The Hughes Court upheld a New York minimum wage law in Morehead v. New York Ex. Rel. Tipaldo (1936) but struck down a similar Washington state law in West Coast Hotel Co. v. Parrish (1937). The case involved Joseph Tipaldo, a Brooklyn laundry owner arrested for violating the minimum wage law. Justice Pierce Butler wrote for a 5–4 majority that “the right to make contracts about one’s affairs is a part of the liberty protected by the due process clause.” The majority relied on the Taft Court’s 1923 decision Adkins v. Children’s Hospital, which upheld a similar District of Columbia minimum wage law for women. Butler reasoned that women were not forced to take the laundry job: “In making contracts of employment, generally speaking, the parties have equal right to obtain from each other the best terms they can by private bargaining.”

Justice Harlan Fiske Stone wrote for the four dissenters, claiming that the majority opinion ignored economic realities facing many workers: “We have had opportunity to learn that a wage is not always the resultant of free bargaining between employers and employees.”

The U.S. Supreme Court overruled Morehead the next year in its Parrish decision. In that case, hotel chambermaid Elsie Parrish alleged that the hotel paid her less than minimum wage. Chief Justice Charles Evans Hughes wrote for a five-member majority that the state minimum wage law did not violate the employer’s due-process rights. He reasoned that legislatures could enact many laws designed to protect workers from harmful conditions. Chief Justice Hughes cited the 1908 decision Holden v. Hardy, which upheld a Utah law limiting the daily employment of mine workers to eight hours a day. “In dealing with the relation of employer and employed, the Legislature has necessarily a wide field of discretion in order that there may be suitable protection of health and safety, and that peace and good order may be promoted through regulations designed to insure wholesome conditions of work and freedom from oppression,” he wrote.