Cantankerous tycoon John P. Merrick Charles Coburn goes undercover as a shoe clerk at Neely's, one of New York's landmark department stores, to identify agitators aiming to form a union after seeing a newspaper photo of his employees hanging him in effigy. In disguise as Thomas Higgins, he lands in the shoe department and quickly befriends Mary Jones Jean Arthur, a kind clerk, and her recently fired boyfriend Joe O'Brien Robert Cummings, a dedicated union organizer. Merrick's undercover days begin to blur the line between employer and employee as he observes the day-to-day grind of the workers, and his empathy grows toward their struggles. Alongside this, he finds himself attracted to Elizabeth Ellis Spring Byington, a gentle, steady presence within the store.
During a sunlit beach day at Coney Island with coworkers, Joe's resourcefulness—helping someone avoid arrest by reciting the >Bill of Rights and the Declaration of Independence<—gives Merrick a glimpse of the workers' humanity and ideals, reshaping his view of the conflict between labor and management. Afterward the trio returns to the city; Merrick, now more sympathetic, joins Joe, Elizabeth, and Mary on the sand, where the three nap as the waves roll in. Unbeknownst to them, Merrick watches as Joe and Mary discuss their hopes for the future and the union drive before the truth behind "Thomas Higgins" is quietly revealed.
As they head home by subway, Merrick slips out a card that confirms his undercover role in the Merrick camp. The moment sparks tension: Mary realizes John is not just a sympathetic observer, but the very manager in disguise, and she confronts Joe with the truth. The two attempt to retrieve the accidental evidence from the manager's office but find themselves trapped in a precarious power play.
Back at the store, the manager tricks the group into handing over the list of potential strikers. Realizing the deceit, John and Mary reclaim the document and destroy it by eating it, after which Mary uses the intercom system to call for a store-wide strike.
In the days that follow, workers picket Merrick's home. John decides to reveal his true identity and arranges a meeting with Mary, Elizabeth, and Joe to discuss terms, supported by his staff. They are initially unaware of his identity, but when it is revealed, Joe faints, Mary screams, and Elizabeth stares at John in disbelief as he asks whether she would rethink her stance about marrying a rich man. The scene cuts to a wedding party aboard a cruise liner, showing a joint wedding: John has married Elizabeth and Mary has married Joe, with all the store employees in attendance. The party is rounded out by the reveal that John has paid for the group to take a Hawaiian vacation.
