United States: SCOTUS To Revisit Precedent On Agency Deference (Beltway Buzz, May 5, 2023)

The Beltway Buzz is a weekly update summarizing labor and employment news from inside the Beltway and clarifying how what's happening in Washington, D.C. could impact your business.

SCOTUS to Revisit Precedent on Agency Deference. This week, the Supreme Court of the United States (SCOTUS) agreed to hear Loper Bright Enterprises v. Raimondo, a case that will invite the Court to overrule its 1984 decision in Chevron U.S.A. Inc. v. Natural Resources Defense Council requiring courts to defer to federal agencies' reasonable interpretations of ambiguous statutes. In Loper Bright Enterprises, a group of fishing companies is challenging a rule issued by the National Marine Fisheries Service (NMFS) requiring the companies to pay the costs of federal observers who travel aboard fishing vessels to monitor compliance with NMFS regulations. The underlying statute, the Magnuson-Stevens Act, authorizes the requirement of onboard monitors but is silent with regard to who pays them. Relying on Chevron, the U.S. Court of Appeals for the District of Columbia Circuit deferred to NMFS's interpretation of the (silent) statutory language, thereby requiring the fishing companies to pay for the federal monitors aboard the vessels. Many stakeholders believe that Chevron deference has incorrectly shifted too much unchecked power to the executive branch. As such, the present case will have major implications for stakeholders in all contexts and for employers appealing actions taken by the U.S. Department of Labor (DOL), National Labor Relations Board (NLRB), U.S. Equal Employment Opportunity Commission (EEOC), and other agencies. A decision is expected sometime in the first half of 2024.

Su in the Hot Seat. Since President Biden's nomination of Julie Su to serve as labor secretary squeaked through the U.S. Senate Committee on Health, Education, Labor and Pensions (HELP) on a party-line vote last week, Republicans in both the Senate and U.S. House of Representatives have been keeping up the political pressure on the nominee.

• This week, Ranking Member of the Senate HELP Committee, Bill Cassidy (R-LA), along with Senator Tommy Tuberville (R-AL), sent a letter to the California Labor and Workforce Development Agency seeking information relating to Su's tenure as California's labor commissioner. Specifically, Cassidy and Tuberville asked the agency to provide them with a copy of a 2017 memo penned by Su "which allegedly instructed [Su's staff] to refuse entry to U.S. Immigration Customs and Enforcement (ICE) agents who visited state labor offices."
• Late last week, Virginia Foxx (R-NC), chair of the House Committee on Education and the Workforce, reiterated her recent request that Su testify (in her capacity as acting secretary of labor) before the committee in mid-May. Regarding Su's failure to respond to the invitation to testify, Foxx wrote, "I am troubled that you are more interested in protecting your record before the Senate acts on your nomination to become the Secretary of Labor than you are in fulfilling your obligation to answer questions posed by members of the Committee."

There is no news on when Su's nomination will be voted on by the full Senate.

NLRB Restores 'Setting-Specific' Standards for Evaluating Employee Misconduct. In a decision issued this week, the Board changed the standard for evaluating whether an employer may lawfully discipline an employee for engaging in abusive or profane conduct while engaging in activity that is otherwise protected under the National Labor Relations Act (e.g., shouting racist epithets while picketing). Prior to 2020, the Board used three different "setting-specific" tests—each with its own analysis—to resolve this question. This proved confusing to employers, yielded inconsistent decisions, and resulted in the Board's sanctioning some truly vile workplace behavior as protected by the act. Accordingly, in 2020, the Board ruled that the well-known Wright Line test should apply to such situations and that an employer may lawfully discipline an employee who engages in abusive or profane conduct in the midst of protected activity—if the employer can show that it would have taken the same action in the absence of the employee's protected activity. In this week's decision, the Board abandoned its commonsense change in 2020 and reverted to its confusing "setting-specific" tests.

Dissenting Member Marvin Kaplan wrote:

Ultimately, this week's decision will make it harder for employers to rid their workplaces of violent or racist language and harassing conduct. Jennifer G. Betts and Zachary V. Zagger have the details.

Dems Seek to Exclude Race Claims From Arbitration. This week, Democrats in the U.S. Senate and U.S. House of Representatives introduced the Ending Forced Arbitration of Race Discrimination Act of 2023, a bill similar to the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, which President Biden signed into law in 2022. Clearly, there is some bipartisan suspicion of arbitration on Capitol Hill, so this bill bears watching.

Sanders: Increase the Minimum Wage. Senator Bernie Sanders (I-VT), chair of the Senate HELP Committee, introduced a bill that would raise the federal minimum wage rate to $17 per hour. Sanders plans to mark up the bill in committee on June 14, 2023. In 2021, the Senate parliamentarian ruled against Democrats' effort to include an increase in the minimum wage in the American Rescue Plan Act. The U.S. Congress last agreed to an increase in the minimum wage in 2007, and the current $7.25 per hour wage has been in effect since 2009.

OSHA NEP on Falls in the Workplace. On May 1, 2023, OSHA launched a national emphasis program (NEP) that "will focus on reducing fall-related injuries and fatalities for people working at heights in all industries." Pursuant to the NEP, OSHA will focus on the construction industry, as well as rooftop work, utility-line work, tree trimming, window cleaning, and other work performed at heights. The NEP states, "OSHA's goal will be accomplished by a combination of enforcement ..., outreach to employers, and compliance assistance. OSHA anticipates that most of the inspections will occur in construction because the majority of the fatal falls to lower levels each year occur on construction worksites."

D.C.'s Convoluted Creation. On May 3, 1802, the U.S. Congress granted Washington, D.C., its municipal charter. The City of Washington's charter gave voters the right to elect a local council and provided for a mayor to be appointed by the president. But D.C.'s founding really goes back to 1790, when the Residence Act—a bargain struck in "The Room Where It Happens"—set in motion the plan to locate the nation's permanent capital along the Potomac River. In 1800, the capital officially moved from Philadelphia to the new federal district, which at the time, consisted of Washington City, Georgetown, Washington County (Maryland), and Alexandria County (Virginia). All these jurisdictions maintained their own laws and political processes until 1871, when an act of Congress created a unified government for the entire District of Columbia. More than 220 years later, Washington, D.C., is still grappling with its identity, as many legislators continue to push for D.C. statehood.

The Buzz will be attending Ogletree Deakins' national educational labor and employment law seminar, Workplace Strategies^®, in San Diego next week but will return on May 19, 2023.

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