Labor unions are worried that a Supreme Court ruling against a federal agency could disrupt the ability of the government to enforce workplace laws.
At issue in Lucia v. Securities and Exchange Commission, which the justices heard Monday, is whether federal employees known as administrative law judges are “officers” under the Constitution and therefore must be appointed by the president, a department head, or a court.
Several federal agencies including the Occupational Health and Safety Administration, the National Labor Relations Board, and the Consumer Financial Protection Bureau use administrative law judges that perform similar functions to the ones at the SEC. So, a court ruling against the SEC could throw a wrench into those agencies as well.
Scott Witlin, a labor lawyer with firm Barnes & Thornburg, noted that the administrative law judges have many powers commonly associated with judges. “The ALJs create a record, they make evidentiary rulings, can compel people to appear before them, and if their decisions aren’t appealed, they become final,” he noted. In prior cases, the court has said that such individuals had to be officers.
The AFL-CIO, the nation’s largest labor federation, argued in an amicus brief for Lucia that the judges were key to investigating violations of federal law since the agencies “rely … on fact-finding by administrative law judges.” It argued that the administrative law judges merely use the authority delegated to them by the heads of their agencies so they don’t run afoul of the Constitution.
In oral arguments Monday, the justices were not so sure, with many struggling to reconcile administrative law judges with the Constitution, but not wanting to disrupt the civil service system, either.
Chief Justice John Roberts said the Constitution’s appointments clause existed to ensure accountability. “In this case, you don’t have that accountability,” he said. “The [agency] can say: Don’t blame us. We didn’t do it. The president can say: Don’t blame me. I didn’t appoint them.”
Justice Elena Kagan countered that the administrative law judges need to be impartial and insulated from political pressures. “So, wouldn’t putting those decision makers even closer to the political body only exacerbate the problem?” she asked.
Legal observers said the justices’ ruling could go either way. “It seems like there isn’t five votes to say everything is kosher, but there is concern over how to write a decision that doesn’t throw the administrative state into confusion,” said Ilya Shapiro, a lawyer who wrote an amicus brief in the case for the free-market Cato Institute.
The case has some odd complications. For instance, the Trump administration has weighed in support of the plaintiffs and against the SEC. That’s because a ruling against the SEC would require more federal officials to be presidential appointees, giving the executive branch more control over the bureaucracy. The SEC didn’t officially weigh in the case. The justices were obligated to appoint an outside lawyer to argue the case on the SEC’s behalf.
Another question is who would do the appointing should the justices rule against the SEC. The Constitution says that the “heads of departments” can appoint officers and the courts have said the officers must be subject to the authority of the department.
“It would be sufficient for the SEC or the NLRB to say, ‘Yes, our ALJs are officers but we will do the appointing ourselves, not a civil service board,’” said Will Samp, chief counsel for the Washington Legal Foundation. Last fall, the SEC announced that it was retroactively appointing its administrative law judges and ratifying their previous decisions. Whether that is allowable isn’t likely to be decided by the Supreme Court in the case, so the status of administrative law judges could come before the Supreme Court again.
• This article has been updated to correct lawyer Scott Witlin’s name.
