Problems relating to the application of antitrust law to labor result from a basic incompatibility between two public policies: the first, embodied in the SHERMAN ACT of 1890, prohibits efforts by anyone to monopolize or restrain competition in the product market; the second, embodied in the NORRIS-LAGUARDIA ACT of 1932 and the WAGNER ACT of 1935, permits workers to combine into unions in order to bargain collectively with employers. COLLECTIVE BARGAINING necessarily assumes, however, the elimination of competition between employees in dealings with their employers; hence the unions' need to achieve a monopoly of the labor market. The ultimate goal of every union is to remove wages, hours, and working conditions as factors in the competition between employers.
The hotly debated question whether Congress intended to include unions within the coverage of the Sherman Act was resolved by the Supreme Court in LOEWE V. LAWLOR (1908), which held a union liable for violation of the Act. Efforts to reverse this result in the CLAYTON ACT of 1914, which declared that the "labor of a human being is not a commodity or article of commerce," and which forbade federal courts from granting INJUNCTIONS against specified kinds of peaceful conduct in labor disputes, were frustrated by extremely narrow constructions of the statutory language by the Supreme Court.
United States v. Hutcheson (1941), which held that the Sherman Act does not reach acts by a union in its own self-interest that do not involve combination with nonlabor groups, marked the beginning of a new period of virtual immunity for unions under the antitrust laws. And in Allen Bradley v. Local 3, International Brotherhood of Electrical Workers (1945) the Court, while holding that a conspiracy between the union and electrical parts manufacturers and contractors to monopolize the industry in New York City violated the Sherman Act, declared that if the union had achieved the same result through parallel but separate agreements with each employer, the arrangement would not have been illegal. Thus, Norris-LaGuardia's comprehensive prohibition against the issuance by federal courts of injunctions in labor disputes, the Wagner Act's authorization of the granting by the National Labor Relations Board of "official patents of monopoly" through its certification procedures, and the rise of industry-wide bargaining combined to create a doctrine of "licit monopoly" of the labor...