In the 1916 case New York Central Railroad Company v. Winfield, the United States Supreme Court ruled in favor of the railroad company. The plaintiff, Winfield, was a former employee who had been injured on the job and sought compensation under New York's Workmen's Compensation Act. However, because his employment contract stipulated that any disputes would be settled according to Illinois law (where such claims were not recognized), he was denied relief by lower courts. On appeal to the Supreme Court, it held that while states have broad power to regulate businesses within their borders for public welfare purposes - including imposing liability for industrial accidents - they cannot extend those regulations beyond their jurisdictional boundaries without violating due process rights protected by Fourteenth Amendment of U.S Constitution. Therefore, since Mr.Winfield’s injury occurred outside of New York State and his employment contract specified Illinois law would govern disputes between him and his employer; applying NY state laws here would violate due process clause.

The dissenting opinion in the case of New York Central Railroad Company v. Winfield argued that the majority's decision to hold employers liable for injuries sustained by their employees, even when there was no negligence on part of the employer, was a misinterpretation and overextension of The Employers' Liability Act. This act was intended to protect workers from risks associated with their employment but it did not intend to make employers insurers against all accidents. The dissent emphasized that liability should be based on fault or negligence rather than simply because an accident occurred during work hours. It also pointed out potential negative consequences such as discouraging businesses from hiring due to increased financial risk and creating an unfair burden on industries where accidents are more likely despite best safety practices being followed.