In the 1948 case of International Union, U. A. W., A.F. of L., Local 232 et al v Wisconsin Employment Relations Board et al, the Supreme Court ruled on a dispute between labor unions and an employer over collective bargaining rights under state law in Wisconsin. The court held that states have jurisdiction to regulate labor disputes when they do not involve interstate commerce or conflict with federal laws such as the National Labor Relations Act (NLRA). In this particular case, Allis-Chalmers Manufacturing Company had refused to bargain with its employees' union over wages and working conditions because it believed that only individual negotiations were permitted under state law. However, the court found that since there was no direct impact on interstate commerce nor any contradiction with NLRA provisions, Wisconsin's regulation requiring employers to negotiate collectively was valid and enforceable.

The dissenting opinion in the case of International Union, U. A. W. A., A. F. Of L., Local 232, et al v Wisconsin Employment Relations Board et al argued that the majority's decision was a departure from established principles governing labor disputes and collective bargaining rights under federal law as well as an intrusion into state sovereignty to regulate its own affairs within its jurisdictional boundaries without interference from federal courts or agencies unless there is clear conflict with national policy or legislation enacted by Congress which did not exist in this case according to them. They contended that the National Labor Relations Act (NLRA) does not preempt states' power to regulate activities like picketing for recognitional purposes when they are conducted peacefully and do not involve unfair labor practices prohibited by NLRA itself; hence, it should be left up to each state whether such conduct should be deemed lawful or unlawful based on their respective public policies rather than being dictated uniformly across all states through judicial interpretation of NLRA provisions. Furthermore, they expressed concerns about potential negative impacts on industrial peace and stability if unions could use coercive tactics like mass picketing indiscriminately without any legal constraints imposed at state level because it might lead to escalation of conflicts between employers and employees instead of promoting mutual understanding and agreement through negotiation process envisaged under collective bargaining framework provided by NLRA.