For a period of almost four years, the state of Wisconsin regulated the collective bargaining process between public utility employers and their employes through the Wisconsin Employment Relations Board. Chapter 414, Laws of 1947, the Public Utility Anti-Strike Law, created section 20.585 and subchapter III of chapter 111 of the statutes. The law proscribed public utility employe strikes, lockouts, work stoppages, or slowdowns likely to cause interruptions of essential public utility services, which were defined as water, light, heat, gas, electric power, public passenger transportation, and communications. Instead, the law provided a means for settlement by conciliation or arbitration of labor disputes in which negotiations had reached impasse or stalemate. Declaring it to be in the public interest to facilitate prompt, peaceful, and just settlement of labor disputes which threatened to interrupt essential public utility services, the law stated that such interruptions resulted in damage and injury to the public and created an emergency situation justifying the action for which the law provided.
Within thirty days of the effective date of the law, the Board was directed to appoint a panel of persons to serve as conciliators or arbitrators. When an impasse occurred in contract negotiations and either party petitioned the Board, the Board was empowered first to appoint a conciliator to meet with the parties to attempt to settle the dispute. In the event that conciliation failed, the Board was authorized to submit a list of names of arbitrators to the parties; each side was allowed to strike alternately one name from the list. Standards were established to govern the decisions of the arbitrators which were final and binding, subject to judicial review.
The constitutionality of the Public Utility Anti-Strike Law was challenged in two cases, the Milwaukee Electric Railway and Transport Company, Case V and the Milwaukee Gas Light Company, Case X, when the unions representing the public utility employes appealed the arbitration orders to circuit court and the Wisconsin Supreme Court. Both courts upheld the constitutionality of the law. These court rulings were subsequently appealed to the United States Supreme Court; and in decisions issued February 26, 1951 (340 U.S. 383 and 340 U.S. 411) the Court overturned the decisions of the lower courts and declared the law unconstitutional. Writing the majority opinion, Chief Justice Fred Vinson ruled that the Wisconsin law conflicted with federal legislation, specifically the Federal Labor Management Relations Act of 1947 (the Taft-Hartley Act), which safeguarded the employes' rights to engage in peaceful strikes. Concurrent state regulation which effectively limited the right to strike could not be permitted. Further, the Wisconsin Supreme Court had sought to distinguish between federal regulation of national manufacturing organizations and local public utilities. However, Chief Justice Vinson ruled that Congress had chosen to draw no such distinctions and to regulate labor relations to the full extent of its constitutional power under the Commerce Clause. Previous U. S. Supreme Court cases had held that federal labor legislation encompassed all industries affecting commerce, whether privately owned local public utilities whose business activities were carried out wholly within one state or national industries affecting interstate commerce. The U. S. Supreme Court also rejected the respondent's argument that Congress had intended to regulate only labor disputes threatening “national emergencies,” leaving the states free to regulate “local emergency” situations. Chief Justice Vinson emphasized that the Wisconsin Act was not, in fact, emergency legislation, but a comprehensive code for the settlement of all labor disputes between public utility employers and employes. With the ruling of the U. S. Supreme Court, Wisconsin's attempt to govern the public utility employe bargaining process came to an end.
