This paper is to explore Smith’s view of law and economics in connection with labor (market) issues. It has been pointed out that Adam Smith’s law and economics tell us that there is an inseparable linkage between justice and economic efficiency. We historically examine major labor-related laws in theLectures on Jurisprudence and the Wealth of Nations. It may thus be drawn that a set of laws reflecting the legal principles of justice, liberty, security and equality, ultimately produce economic efficiency in a labor market, and thus increase social welfare.