Today in 1911: The Supreme Court compulsion to work to pay off a debt is unconstitutional

January 3, 2014

Today in Legal History08Let’s say that you agreed to work for an employer for one year.  As a part of this contract, you agree to work for a sum of money upfront in addition to a regular monthly wage.

Now let’s say that for some reason, your circumstances change and you are only able to continue working for this employer for a little over a month.

If you break the contract, what are the worst legal consequences that you could face?  At worst, a breach of contract lawsuit which, if you lose, could hit you with a monetary judgment.

But what if you could face criminal charges for such an action?

Such a possibility wasn’t too far-fetched a century ago, at least in a handful of states like Alabama.

Why Alabama?  The state had a law on its books that made it a crime to take such a course of action as that described above.

The law specifically read as follows:

Any person who, with intent to injure or defraud his employer, enters into a contract in writing for the performance of any act of service, and thereby obtains money or other personal property from such employer, and with like intent, and without just cause, and without refunding such money, or paying for such property, refuses or fails to perform such act or service, must on conviction be punished…

True, the literal reading of this portion requires the finding of intent to injure or defraud; however, the section was amended in 1903 to make the refusal or failure to perform the service, or to refund the money paid upfront without just cause, prima facie evidence of the intent to injure or defraud.

In other words, your failure to finish the one year term specified in the contract could be used as evidence of your intent to injure or defraud your employer – and you could be criminally convicted under the statute simply for quitting your job.

Sounds unconstitutional, doesn’t it?  The Supreme Court agreed, and struck Alabama’s law down as such 102 years ago today in Bailey v. Alamaba, decided on January 3, 1911.

But the reason that the Supreme Court struck down the law as unconstitutional may not be what you’d expect.

Under current jurisprudence, the state’s law seems like a gross violation of the Fourteenth Amendment’s Due Process Clause (if not several other constitutional provisions more directly relating to criminal law).  And if the Supreme Court were reviewing such a law today, there’s no doubt that these provisions would be immediately cited by the Court in its invalidation of the statute.

The Bailey Supreme Court of 1911, however, found that the statute ran afoul of the Thirteenth Amendment.  That’s right – the one that prohibits slavery.

The Bailey Court would quickly correct me, though, since the Thirteenth Amendment also prohibits “involuntary servitude,” and as noted in the Bailey opinion, “[t]he words involuntary servitude have a larger meaning than slavery.”

To this end, the Court’s Bailey ruling found “that the effect of the statute is to enforce involuntary servitude by compelling personal service in liquidation of a debt.”

This relationship – that is, the compulsion of personal service in payment of a debt – was mentioned by the Court in its reference to the term “peonage,” described as “a condition which has existed in Spanish America, and especially in Mexico.”

The Court held that just because Alabama’s law wasn’t literally enforcing peonage, the effect was the same, and the Thirteenth Amendment forbade it just as much as it did slavery.

Does this mean that people today shouldn’t feel compelled to work because of their debts?  Unlikely, especially considering just how many individuals share this sentiment.

But the 102 year old Bailey is interesting in that it did recognize the effect of a state law as compelling individuals to work to pay off a debt – and accordingly struck down the law as violative of the Thirteenth Amendment.