The observation of Labor Day on the first Monday in September is usually attributed to the Knights of Labor who held their first parade on September 5, 1882. But far more important is the Haymarket Riot/Massacre of 1886. (See also graveyards.com , kentlaw.edu and holtlaborlibrary.org). There are several interpretations of what occurred, and monuments have been constructed to both the demonstrators and the police. A reasonable summary is that the labor organizers were peacefully demonstrating for an eight hour day, an anarchist threw a bomb in to the crowd, which killed a policeman, the police killed several demonstrators and some policemen, the powers that be arrested the labor leaders.
It was in 1887 that Oregon became the first state to establish Labor Day as a holiday, which it put on the first Saturday in June. Colorado, Massachusetts, New Jersey, and New York observed Labor Day on the first Monday in September that year. Then in 1889, the First (Paris) Congress of the Second Socialist International selected May First as a day for international celebration of the working man, no matter what day of the week it fell on. May first was chosen in commemoration of the Haymarket Massacre which occured in Chicago in 1886. In 1894, the first Monday in September was established as a federal holiday in the United States.
Why should the American working man celebrate Labor Day in September when the workers of the world are celebrating it on May first in commemoration of American Martyrs to the labor movement? This question is clarified by the fact that May first is observed unilaterally by workers (not by management), while the September holiday is enjoyed by all, perpetuating the myth that Labor and Management are both working together. The proclamation of Labor Day in September in the United States can only be interpreted as an effort to isolate the working American from his colleagues around the world, and obscure the history of what Management did to Labor in Chicago in 1886. Labor Day in the United States is better described as mocking than celebrating the working man in America.
[The immediate cause of the establishment of Labor Day as a holiday in September was to appease the working man after the Crushing of the Pullman strike in 1894.]