It is agreed generally that private employment agencies organized for a profit may be regulated. Brazee v. Michigan,241 U.S. 340, 36 S. Ct. 561, 60 L. ed. 1034; Moore v. City of Minneapolis, 43 Minn. 418, 45 N.W. 719; note in 56 A.L.R. 1340. But it has been held that regulation may not become prohibition, Adams v. Tanner, 244 U.S. 390, 37 S. Ct. 662,61 L. ed. 1336, L.R.A. 1917F, 1163, Ann. Cas. 1917D, 973, and that the business of operating an employment agency is not so affected with public interest as to permit the state to fix prices charged for services rendered. Ribnik v. McBride.277 U.S. 350, 48 S. Ct. 545, 72 L. ed. 913, 56 A.L.R. 1327. In both the Adams and the Ribnik cases three justices dissented, principally upon the ground that since the business of operating a private employment agency for profit is a nefarious one, productive of many evils, it can lawfully be prohibited or strictly regulated. With these dissents I agree. Further, however, I do not believe that the majority opinions in these cases, strictly construed, control the case at bar. The prohibition referred to in the Adams case is a prohibition of the entire business. In that case the statute in question would have put out of business all private employment agencies in the state of Washington. In the case at *Page 398 bar the prohibition is as to a single agency, not as to the entire business. The statute here involved permits the industrial commission to refuse to license a single agency in a given community if, in its discretion, the number of agencies in that particular community is at the time sufficient to care for the needs of the persons living therein. This type of prohibition is nothing more than regulation, which admittedly is lawful. This is not prohibition in the sense in which the term was used in the Adams case. It is regulation by limiting numbers, not prohibition of the entire business.
Why is regulation in the case at bar not a valid police measure? The more agencies in existence in a particular community the keener and more bitter the competition. Such competition inevitably leads to the vicious practice of charging unreasonably high fees, of sending men away from the community for a few days' work in order to produce a fee, of splitting fees with an employer, and other dishonest and corrupt dealings. Admittedly, the state can regulate the business by prohibiting such practices. Why, then, can it not choose as a means of regulation to limit the numbers so that the conditions which lead to and produce the above abuses will not be present? If the field is not overcrowded, men can make an honest living and the abuses will disappear.
The state industrial commission can use this means of regulation justly and without prejudice. Reasonableness is the test. I believe the demurrer should be overruled. *Page 399