In the 1975 case National League of Cities v. Usery, the U.S. Supreme Court ruled that certain provisions of the Fair Labor Standards Act (FLSA) were unconstitutional insofar as they applied to state and local governments. The FLSA had been amended in 1974 to extend minimum wage and maximum hours regulations to almost all employees of states and their political subdivisions. However, a group led by the National League of Cities challenged this extension on constitutional grounds, arguing it violated states' rights under the Tenth Amendment which reserves powers not delegated to federal government for states or people. The court sided with them in a 5-4 decision stating that while Congress has broad power under Commerce Clause, it cannot use this power to force directly upon States its choices as how essential decisions regarding conduct of integral governmental functions are made; such an exercise infringes upon States’ sovereignty protected by Tenth Amendment against intrusive exercises of Congress's Commerce Clause powers.

In the dissenting opinion for National League of Cities v. Usery, Justice William Brennan disagreed with the majority's decision that Congress overstepped its authority under the Commerce Clause by extending federal minimum wage and maximum hour provisions to state and local government employees. He argued that this interpretation was a departure from established precedent which had long recognized Congress' broad power to regulate commerce. Brennan contended that there were no constitutional grounds for distinguishing between private businesses and states in terms of economic activities affecting interstate commerce. Furthermore, he expressed concern about potential negative consequences of this ruling on future legislation aimed at addressing national problems through regulation of economic activity.