International Shoe CO. V. State of Washington

International Shoe CO. V. State of Washington

Name 2

InternationalShoe CO. V. State of Washington

Facts:The International Shoe Co. is a manufacturing company that is basedin the state of Delaware. The company manufactures and sellsfootwear, including shoes. Although the International Shoe does havean office in Washington, it employed 11 salespeople in Washingtonbetween 1937 and 1940, who were under the direct supervision of thesales manager in Delaware. Consequently, the company would beexpected to contribute about $ 31,000 annually.

Issue:Has the International Shoe Co., through its activities in Washington,rendered itself amenable to proceedings taking place in Washington torecover contributions that have not been paid to the unemploymentcompensation fund as required by the state statutes?

Holding:The Supreme Court in the State of Washington held that the fact thatInternational Shoe Co. solicited orders from the state of Washingtonin a systematic and regular way, in addition to a continuous flow ofthe company’s products were sufficient to conclude that the companyhad rendered itself amenable to suits brought against it in the stateof Washington.

Ruleof law:All employers with some operations in the state of Washington arerequired by the local statutes to contribute towards the state’sunemployment compensation fund. The contribution is computed as apercentage of wages that a given employer makes to employees forservices that are rendered within the state.

Reasoning:The state of Washington has the power to make and implement laws aslong as those laws are within the confines of the nationalconstitution. Similarly, the state, through its Commissioner, has thepower to collect contributions meant for the unemploymentcompensation fund from all employers, who pay wages for any type ofservice rendered within the state. This implies that any employer whopays wages for services that are rendered within Washington can besued in the state courts on matters related to the unemploymentcompensation contributions.

Opinion: The decision made by the judges of the Supreme Court gave a clearcriterion that should be used to hold employers responsible for theirintra- and interstate activities. The decision made it illegal foremployers to refuse to take up their corporate responsibilities byoperating in different states without necessarily having to openoffices in those states. Therefore, the company can be sued in astate on the basis of its activities, even if it does not have apermanent office in that state.