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withdraw the attempted enforcement from the condemnation of the statute
[prohibiting peonage]. The full intent of the constitutional provision could be
defeated with obvious facility if, through the guise of contracts under which
advances had been made, debtors could be held to compulsory service. It is
the compulsion of the service which the statute inhibits, for when that occurs,
the condition of servitude is created, which would be not less involuntary because
of the original agreement to work out the indebtedness. The contract exposes
the debtor to liability for the loss due to the breach, but not to enforced labor.
The act of Congress deprives of effect all legislative measures of any state through
which, directly or indirectly, the prohibited thing, to wit, compulsory service to
secure the payment of a debt, may be established or maintained."



THE CONTRACT OF EMPLOYMENT 19

Other jurisdictions having laws of this tenor are Arkansas/
Florida,^ Georgia,^ Louisiana,* Michigan/ Minnesota,' New
Mexico,^ North Dakota,* and South Carolina.' The laws of
Michigan, Minnesota, and North Dakota seem to contemplate
primarily the fraudulent procurement of transportation, though
they include other forms of advances, and contain the provision
making failure to repay prima facie evidence of fraud, thus
bringing these laws within the strictures of the opinion of the
Supreme Court in the Bailey Case, The charge had already
been made against some of the laws of this class that they violate
the national law prohibiting peonage, which is defined as a
"status or condition of compulsory service, based upon the in-
debtedness of the peon to the master." ^° The statute under
discussion when this definition was given was an earlier one of
Florida, and it was said by the Supreme Court of the United
States that that which was contemplated by the law was com-
pulsory service to secure the payment of a debt. This case was
referred to in the course of an opinion in which a law of South
Carolina ^^ was declared unconstitutional by a Federal court as
being in conflict with the thirteenth and fourteenth amend-
ments of the Constitution of the United States, and laws made
in pursuance thereof.*^ This statute was also held unconstitu-
tional by the supreme court of the state of South Carolina in a
case ^^ in which the opinion was very full, and in which a

» Acts of 1907, No. 271. « Acts of 1906, No. 54. » Acta of 1905, ch. 37.

* Acts of 1907, ch. 5678. ' Acts of 1903, No. 106. » Acts of 1907, ch. 208.
» Acts of 1903, p. 90. • R.L. 1905. sec. 5187. • Acts of 1908, No. 494.

'» Clyatt V. U.S., 197 U.S. 207, 25 Sup. Ct. 429.
■' Crim. Code, sec. 357, as amended by acts of 1904, No. 243.
" Ex parte Drayton, 153 Fed. 986.

>' Ex parte Hollman, 79 S.C. 9, 60 S.E. 19. The dissenting opinion presenta
the economic reasons for laws of this class.



20 LAW OF THE EMPLOYMENT OF LABOR

lengthy dissenting opinion was also written. In declaring this
law unconstitutional, the court reversed the position it had held
in earUer cases,^ taking the ground that the statute violated
the right of citizens to be exempt from imprisonment for debt
except in cases of fraud, as provided in the state constitution ;
further, that it violated the thirteenth amendment of the Con-
stitution of the United States, as its enforcement would lead to
peonage or involuntary servitude ; and the fourteenth amend-
ment likewise, since it did not bear equally on the landlord and
the laborer. The present law of South Carolina was enacted by
the legislature of 1908 (Act No. 494), and is extended to include
personal service of every kind, applying to employers who fail
or refuse to receive and compensate personal service after con-
tracting therefor, as well as to employees who fail or refuse to
render such service. Fraud or malicious intent to injure is
essential to the offense, the failure without sufficient cause to
carry out the contract, to the injury of the other party, being
prima facie evidence of fraud and malice. The law covers cases
where advances are not received or promised, as well as others,
though contracts based on debts incurred prior to the commence-
ment of service thereunder are expressly declared null and void.
In laws where the repayment of advances is considered, it is
contended in their favor that it is not against the laborer's
breach of contract that the penalty lies, but against a mis-
demeanor, "as if he had stolen" the advanced property (Ala-
bama) ; "he shall be deemed a common cheat and swindler"
(Georgia); "shall be guilty of a misdemeanor," and be pun-
ished by fine or imprisonment (Michigan and Minnesota), etc.

> State V. Williams, 32 S.C. 124, 10 S.E. 876 ; State v. Chapman, 56 S.C. 420,
34 S.E. 961 ; State v. Easterlin, 61 S.C. 71, 39 S.E. 250.



THE CONTRACT OF EMPLOYMENT 21

It is claimed that the state has the right to penalize such breach,
after the receipt of advances, as a punishment of fraud, and for
the purpose of repressing fraudulent practices; and the laws have
received judicial support on this ground.^ The whole hst of
such laws apparently falls under the charge that was made
against the Florida statute in the Clyatt case, above, — that
their purpose is the compulsory payment of a debt, in which
view they would come under the strictures of the same court
set forth in another case, where it was said that a "mere statute
to compel the payment of indebtedness does not come within
the scope of police regulations." ^ Their effect is, at least,
*to expose the weak and unintelligent to oppression and in-
justice at the hands of the powerful and unscrupulous, — to
offer easy possibilities of misuse for the collection of debts and
the enforcement of civil contracts without regard to the inten-
tion of the defendant ' ; ^ and they cannot be looked upon as
valid, in view of the pronouncement in the Bailey case."*

As a means to the same end of enforcing the performance of the
labor contract, the Alabama legislature enacted a law ^ by which
an employee under written contract for a specified time to work
for another or to lease lands was prohibited from making a
second contract without the consent of the first employer and
without sufficient cause, to be adjudged by court, unless he
should give notice of the preexisting contract. The punishment
was a fine or penal service. This act was declared unconstitu-

1 Vance v. State, 128 Ga. 661, 57 S.E. 889 ; State v. Murray, 116 La. 655. 40
So. 930.

» Gulf, etc., R. Co. V. Ellis, 165 U.S. 157. 17, Sup. Ct. 257.
' Patterson ». State, 1 Ga. App. 782, 58 S.E. 284.

* Bailey v. Alabama, supra.

* Acts of 1900-1901, No. 483.



22 LAW OF THE EMPLOYMENT OP LABOR

tional, first by a Federal court/ and later by the supreme
court of the state.^ In the opinion of the court first named it
was held that the act was a coercive weapon by which the
employer would seek to compel the payment of a debt or the
performance of a contract, in cases where only a suit for
damages would lie ; while the state court condemned the law
because of the restrictions it undertook to place on the right
to make contracts of employment.

The state of Mississippi has a statute ^ of like tenor with
the above, enacted in 1900, which does not appear to have yet
received consideration at the hands of the higher courts, but is
doubtless likewise invalid.

Employees engaged in the operation of railroad trains, and in
Connecticut of street cars, who abandon the train or car at
another point than its scheduled destination, are declared
guilty of a misdemeanor in a number of states.'* In some cases
the law applies only where there is a combination to strike, and
in some to locomotive engineers only. A more general statute
applies to any person violating his contract when he knows or
has reason to believe that the probable consequences of his
breach will be the endangering of life, the causing of bodily
injury, or the exposure of valuable property to destruction.^
A law of another state provides that an employee of any sort on
a steamboat who abandons the boat before the termination of
his contract or who refuses to perform the work for which he

» Peonage Cases, 123 Fed. 671. « Toney v. State, 141 Ala. 120, 37 So. 332.

•Code of 1906, sec. 1147.

«Conn., G.S. sec. 1293; Del., R. Code, p. 928; 111., R.S. ch. 114, sec. 108;
Kana., G.S. sec. 2374 ; Me., R.S. ch. 124, sec. 6 ; N.J., Acts 1903, ch. 257,
sec. 62 ; Pa., B. P. Dig. p. 533.

» N.Y., C.L. ch. 40, sec. 1910 ; Wash., Acts 1909, ch. 249, sec. 281.



THE CONTRACT OF EMPLOYMENT 23

contracted shall not only forfeit all wages due, but shall also be
liable for all damages caused by his act.^

Practically all the states have laws relating to apprentices
and the regulation and enforcement of contracts with them.
These laws generally prescribe the term of indenture, the duties
of the master as to training, education, and the payment of the
stipulated amount on the expiration of the term. The appren-
tice is required to complete his term, and enticing or harboring
him or otherwise interfering with the relation of apprenticeship
is forbidden. These laws are practically obsolete at the present
time, contracts between employers and unskilled men or boys
learning trades being for the most part governed by the rules
of law generally applicable to labor contracts.

Section 10. Seamen. — A class of employees that stands on
a different footing from any other is that of seamen, with ref-
erence to whom it has been held that enforced contracts are per-
mitted, the law as to involuntary servitude not being applicable.^
Many distinctive, legally recognized customs apply to them, as
well as a special code of statutes, chiefly Federal,^ since the con-
trol of seamen belongs to Congress, being recognized as within
the commerce clause of the Constitution.'* These laws and
customs relate to the nature of the contract, the term of service,
the payment, assignment, etc., of wages, advance payments,
and credits, the regulation of sailors' lodging houses, of shipping
masters, quarters on board ship, rations, and many other details.

The reason for these differences, which take seamen outside
the control of the general laws affecting labor, is grounded in

» La., R.L. sec. 945.

* Robertson v. Baldwin, 165 U.S. 275, 17 Sup. Ct. 326.

' R.S., scrs. 4501 to 4012, Comp. Stat. 1901. pp. 3061 to 3125.

« Patterson v. The Eudora, 190 U.S. 169, 23 Sup. Ct. 821.



24 LAW OF THE EMPLOYMENT OF LABOR

ancient custom, and is defended on the view that the business
of navigation requires some guaranties, beyond the ordinary
civil remedies upon contracts, to effect their enforcement ; and
further, because of the manner of their Ufe by reason of which
seamen are peculiarly exposed and subjected to the will and ca-
price of the ship's officers on the one hand, and to designing and
corrupt traders, etc., on land on the other. "Indeed, seamen
are treated ^by Congress, as well as by the Parliament of Great
Britain, as deficient in that full and intelligent responsibility
for their acts which is accredited to ordinary adults, and as
needing the protection of the law in the same sense in which
minors and wards are entitled to the protection of their parents
and guardians." *

On account of these differences, and their limited field of ap-
plication, the conditions of employment of seamen will not be
further considered.

Section 11. Breach of Contract hy the Employer. — As already
stated, a contract of employment is enforceable against the
employer to the extent that damages may be recovered for the
breach thereof, and an employee under contract is entitled to
recover the wages agreed upon where the employer refuses to
accept services in accordance with the terms of the contract.^
If, however, the employee fails to show that he was ready and
willing to render the services, or puts himself in a position where
performance is not possible, he can enforce no claim ; ' but
tender of service after notice of discharge is not necessary.'*

> Robertson v. Baldwin, supra. ^ Costigan v. R. Co., 2 Den. 609 (N.Y.).

' Polk V. Daly, 4 Daly 411 (N.Y.) ; Collins v. Hazelton, 65 Mich. 220, 31 N.W.
843.

* Bacon v. New Home S.'M. Co., 13 N.Y. Supp. 359 ; McMiillen v. Dickinson
Co., 63 Minn. 405,65 N.W. 661.



THE CONTRACT OF EMPLOYMENT 25

Of necessity, no question can arise as to the breach of a con-
tract terminable at will. This rule has been carried so far as
to hold that an employee who had left his place with his former
employer and was proceeding under an agreement with a new
employer and in compliance with his instructions, could recover
no damages for the repudiation of the contract by the latter
before the performance of any part of the contract, in the ab-
sence of proof of a stipulated term of employment.'- The better
reason would seem to support the position that a breach without
giving the employee a chance to begin work gives him a right
to at least nominal damages ; since, even though the contract
was for no definite time, it was for some time, and the actual
performance of and payment for labor in some amount were
contemplated.^

Where an employer breaks a contract of hiring for a specified
time, the employee may wait until the expiration of the contract
period and recover the amount of wages he would have earned
but for his wrongful discharge, less what he earned or could
have earned by employment elsewhere.^ It is held by the weight
of authority that the burden of showing that the plaintiff was
able to procure other employment rests on the defendant em-
ployer;* though the question may be referred to the jury to
decide from the circumstances as to the reasonable prospect of

> Savannah, etc., R. Co. v. Willett, 43 Fla. 311,31 So. 246. See also Merrill
V. W. U. Tel. Co., 78 Me. 97, 2 Atl., 847.

« Cronemillar v. Milling Co., 134 Wis. 248, 1 14 N.W. 432 ; Burtis v. Thompson,
42 N.Y. 246 ; Utter v. Chapman, 38 Cal. 659.

» Winkler v. Racine Wagon, etc., Co., 99 Wis. 184, 74 N.W. 793 ; Efron ».
Clayton, 35 S. W. 424 (Texas Civ. App.) ; Pierce v. R. Co., 173 U.S. 1, 19 Sup.
Ct. 335 ; Cutter v. Gillette, 163 Mass. 95, 39 N.E. 1010.

* Mathesius v. R. Co., 96 Fed. 792 ; Wilkinson v. Black, 80 Ala. 332 ; Hamilton
V. Love, 43 N.E. 873 (Ind.) ; Maynard v. Corset Co., 200 Mass. 1, 85 N.E. 877.



26 LAW OF THE EMPLOYMENT OF LABOR

the discharged employee's procuring employment during the
unexpired term of his contract.* In some states the burden is
shifted to the plaintiff.^ While it is the plaintiff's duty to use
reasonable efforts to avoid loss by securing employment, he is
not bound to accept new employment of a nature essentially
different from that for which he was originally employed,^ even
from his former employer.*

Instead of suing for the wages that would have been earned
but for the breach of the contract, the remedy prescribed in some
jurisdictions is an action for the damages caused by the breach.^
This suit may be brought either immediately or at the expira-
tion of the term.^ The measure of damages recoverable will
usually be the contract price for the labor.^ In jurisdictions
where suits for wages are allowed, the employee may choose
which of the two remedies he will pursue.^ The rule in Louis-
iana is to the effect that the right to recover wages for the un-
expired term of the contract becomes vested at once on its
unwarranted breach by the employer, and is not affected either
by the acceptance of other employment or by a refusal to return

1 Moore v. Central Foundry Co., 68 N.J.L. 14, 52 Atl. 292.

« John C. Lewis Co. v. Scott, 95 Ky. 484, 26 S.W. 192 ; Hunt v. Crane, 33
Miss. 669, 69 Am. Dec. 381.

' Leatherberry J). Odell, 7 Fed. 641 ; Fuchs v. Koerner, 107 N.Y. 529, 14 N.E.
445.

• De Loraz v. McDowell, 68 Hun. 170, 22 N.Y. S. 606 ; Jackson v. School
District, 111 Iowa 20, 77 N.W. 860.

» Weed V. Burt, 78 N.Y. 191 ; Stone v. Bancroft, 112 Cal. 653, 44 Pac. 1069.

• Hamilton v. Love, supra; Olmsted v. Bach, 78 Md. 132, 27 Atl. 501 ; James
V. Allen Co., 44 Ohio St. 226, 6 N.E. 246.

' Lambert v. Hartshorne, 65 Mo. 549 ; Fuller v. Little, 61 111. 21 ; Hamilton
V. Love, supra.

• Fowler v. Armour, 24 Ala. 194 ; Mullaly v. Austin, 97 Mass. 30 ; Tyler
Cotton Press Co. r. Chevalier, 56 Ga. 494 ; McLean v. Pub. Co. (N.D.), 129
N.W. 93.



THE CONTRACT OF EMPLOYMENT 27

to work under the original contract ; ^ but this doctrine is
grounded on the peculiar statute of the state,^ and is not in line
with the commonly accepted rules of law elsewhere.

Where an employee had an option on permanent employment
by reason of a contract entered into in consideration of for-
bearing to sue for damages on account of an injury, and he is
discharged without cause, he may sue for loss of earnings since
his discharge, and for such earnings as would have been re-
ceived in the future, less probable earnings in other employment.'

Section 12. Grounds for Discharge. — If the employer can
successfully defend his course of action in discharging an em-
ployee under contract, no damages will be allowed, and, apart
from special provisions in the contract, the question whether
the discharge was warranted or not is one for the jury.^ A
workman of adult age undertaking to do a piece of work is pre-
sumed to be competent, and incompetency is a sufficient ground
for discharge, whether he made representations as to his com-
petency,^ or whether it was merely presumed.* The word
" colhpetency," as used in this connection, is not to be taken in an
absolute sense, however, and imports nothing more than reason-
able skill.^ Where an employer alleges incompetence as the
ground for breaking a contract, the burden of proof is on him.*

' Curtis V. A. Lehman Co., 115 La. 40, 38 So. 887 ; Camp v. Baldwin-Melville
Co., 123 La. 257, 48 So. 927. ' La., Civ. Code, art. 2749.

' Rhoadea v. Chesapeake & O.R. Co., 49 W. Va. 494, 39 S.E. 209.

* Lippus V. Watch Co., 7 N. Y. Supp. 478 ; Echols v. Fleming, 58 Ga. 156.

' Mexican Amole Soap Co. v. Clark, 72 111. App. 655 ; Anstce v. Ober, 26 Mo.
665.

« Lyon V. Pollard, 20 Wall. 403 (U.S.) ; Keedy v. Long, 71 Md. 385, 18 Atl. 704.

' Crescent Horseshoe Co. v. Eynon, 95 Va. 151, 27 S.E. 935 ; Walton v. God-
win, 58 Hun 87, 11 N.Y. Supp. 391.

• Mexclbaum v. Limbcrger, 78 Ga. 43, 3 S.E. 257 ; Franklin v. Lumber Co.,
66 W. Va. 104, 66 S.E. 225.



28 LAW OF THE EMPLOYMENT OF LABOR

An employee must, however, perform the duties for which he
contracted with a degree of skill suited to the terms of his con-
tract for the undertaking in hand, and he cannot, if discharged
for incompetency, plead performance with ordinary skill. ^

Where a contract is for a definite term, and a provision is
made that the service shall be satisfactory to the employer, the
decision of the latter is final if he is in good faith dissatisfied ; ^
though in some cases it is held that the employer is the sole
judge, and that no question of good faith can be raised.^ This
is opposed by the view held in a case involving the breach of a
contract for permanent employment, conditioned on the em-
ployee giving satisfaction to his foreman or superintendent ; it
was here said that the burden of proof was on the employer to
show good cause for the discharge, the appellate court refusing
to set aside a verdict of the trial court in the discharged em-
ployee's favor.* If the dissatisfaction is genuine, it is not
material that it is not well founded ; ^ nor is the employer
restricted, in his defense to an action, to the cause originally
assigned as the reason for the discharge, but may adduce other
reasons,® even if they were not known to him at the time of the
discharge.'

One state undertakes to regulate discharges by providing that

» Hatton V. Mountford, 105 Va. 96, 52 S.E. 847.

> Koehler v. Buhl, 94 Mich. 496, 54 N.W. 157 ; Frary v. Rubber Co., 52 Minn.
264, 53 N.W. 1156 ; Mackenzie v. Minis, 132 Ga. 323, 63 S.E. 900.

' Allen XI. Compress Co., 101 Ala. 574, 14 So. 362 ; Crawford v. Pub. Co., 163
N.Y. 404, 57 N.E. 616.

* Rhoades v. Chesapeake & O.R. Co.. 49 W. Va. 494, 39 S.E. 209.

» Mackenzie v. Minis, supra.

« Corgan v. Coal Co., 218 Pa. 386, 67 Atl. 655.

'' Von Heyne v. Tompkins, 89 Minn. 77, 93 N.W. 901 ; Loos r. Brewing Co.,
145 Wis. 1, 129 N.W. 645. See Wood's " Master and Servant," 2d ed., sec.
121.



THE CONTRACT OF EMPLOYMENT 29

no employee between the ages of eighteen and sixty shall be
discharged solely on account of age.^

In a general contract of hiring, without reference to the term,
an agreement not to suspend or discharge without just and suf-
ficient cause is not a restriction against discharge at the em-
ployer's option ; ^ but if the employment is for a term, the mere
fact of general misconduct on the part of the employee is not
sufficient ground for discharge unless it is made to appear that
it is misconduct in connection with his employment or is of such
a nature as to prejudice his employer's interests.^ Willful
disobedience of reasonable and lawful orders,* or other viola-
tion of the implied terms of the contract (seel), as well as
violation of its express terms, will, if proved, generally be a
sufficient defense for an employer in an action for damages for a
breach of the contract. If it can be shown that the disobedi-
ence was not of a nature to injuriously affect his employer, it has
been held that the employee may still recover damages, as he is
entitled to some measure of self-direction,^ especially if skilled.'

It will be regarded as a breach of the contract by the employer
if he violates its terms, express or implied, as by requiring other
service than that contracted for ; ' though it has been said that
this alone will not amount to a breach, so long as the employee
is permitted to perform the work for which he was hired ; ^ nor,

» Colo., Supp. sec. 2801c2.

« St. Louis, I. M. & S. R. Co. r. Mathews, 64 Ark. 398, 42 S.W. 902.

» Child V. Boyd, etc., Mfg. Co., 175 Mass. 493, 56 N.E. 608.

* Forsyth v. McKinney, 56 Hun 1. 8 N.Y. Supp. 561.

'Shaver v. Ingham, 58 Mich. 649, 26 N.W. 162; Hamilton v. Love,
43 N.E. 873 (Ind.).

• Park V. Bushnell, 60 Fed. 583, 9 CCA. 138.
T Baron v. Placide, 7 La. Ann. 229.

« Koplitz V. Powell, 56 Wis. 671, 14 N.W. 831.



30 LAW OF THE EMPLOYMENT OF LABOR ,

on the other hand, can the employee's refusal to do work out-
side the scope of his employment be made a ground for dis-
charge.^ Where the order to do the new work is coupled with
a refusal to permit the performance of the work contracted for,
there is a breach for which an action will lie ; ^ so also where the
employer restricts the employee's rights under the contract,^ or
does other acts prejudicial to the employee's safety, morals,
or reputation. The modification of the conditions of employ-
ment is in effect making a new contract, and will involve the
necessity of proving a sufficient consideration to support it.*
In case of a contract terminable at will, continuance in em-
ployment with knowledge of the modification is considered an
acceptance of the new terms.^ Neither party can recover
damages for the breach of a contract which contravenes pubUc
pohcy.

Section 13. Other Methods of Dissolving the Contract Rela-
tion. — Besides abandonment of the contract by the employee
or its breach by the employer, ordinary contracts of employ-
ment may be terminated, without entailing liabiUty on either
party beyond the payment of wages earned up to the time of
dissolution, by mutual consent ; ® by the expiration of the con-
tract period, after which an employee seeking to recover wages
for services rendered must show that the contract was renewed
or extended, either expressly or by implication ; ^ by the death

' Loos V. Brewing Co., supra; Koplitz v. Powell, supra.

'Cooper V. Stronge & Warner Co., Ill Minn. 177, 126 N.W. 541 ; Marx v.
MUler, 134 Ala. 347, 32 So. 765.

' Baldwin v. Marqueze, 91 Ga. 404, 18 S.E. 309.
* Davis V. Morgan, 117 Ga. 504, 43 S.E. 732.
» Norton v. Brookline, 181 Mass. 360, 63 N.E. 930.
« Patnote v. Sanders, 41 Vt. 66, 98 Am. Dec. 564.
» Ewing V. Janson, 57 Ark. 237, 21 S.W. 430.



THE CONTRACT OF EMPLOYMENT 31

or continued sickness of the employee ; ^ or by the occurrence
of some event for which neither party is responsible, which
makes the rendering of the service impossible or unreasonable
and out of consonance with the original intent of the parties.^
The mere fact that an undertaking develops greater difficulties
than were contemplated at the time the contract was entered



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