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Supreme Court Lays Down the Law

July 25, 2022
President Biden and his administration should heed the court’s insistence on making regulations properly.

Analysis & Commentary

While public attention was gripped by the Supreme Court’ momentous decision overturning Roe v. Wade, the larger implications of some of its decisions handed down around the same time went largely unnoticed, although they reined in some of the perceived excesses of the federal administrative state.

If, as is currently predicted, the Republicans achieve a majority in both the Senate and the House of Representatives this fall, Biden and his staff may be tempted to follow the lead of President Obama after Republicans took control of the Senate during his presidency. Instead of looking for ways to compromise with the GOP senators to achieve his legislative goals, Obama boldly declared that he would instead rule “with a phone and a pen” and then issued a string of presidential decrees in the form of executive orders.

How did that work out for Obama? Not too well it turned out—13 of those executive orders were subsequently struck down by the Supreme Court. And not by a majority made up only of conservative justices. Instead, all 13 were overturned unanimously. His efforts in this regard succeeded only in creating unnecessary and wasteful confusion over government policy and practice, while providing a lot of lawyers with many hours of additional work, if you consider that a productive use of their efforts.

When it came to Biden, he started churning out executive orders starting on his very first day in as President and has continued to issue a paper tsunami of them ever since. In his case, most of these turned out to be far less powerful in their reach than the overwrought rhetoric created by his staff suggested.

One exception that ended in disaster for Biden was his order directing the Occupational Safety and Health Administration (OSHA) to issue an emergency temporary standard (ETS) regulating employer responses to COVID-19 in the workplace. Although initially intended to placate labor unions, in time it was used to impose a massive mandatory vaccinations program on America’s workforce that angered a large portion of the population and eventually was struck down by the Supreme Court.

In this and similar cases, the court has shown itself over the years to be a fierce protector of the regulatory safeguards embodied in the Constitution and laws passed by Congress aimed at restraining federal agency excesses. By tackling what it sees as regulatory overreach by the administrative branch, the High Court sought to protect the essential role assigned in the Constitution exclusively to the legislative branch for writing laws and setting certain national policy priorities.

In the decision overturning OSHA’s vaccination order, the justices held that OSHA, an executive branch agency, had overstepped its bounds by failing to follow requirements of the Administrative Procedures Act. That law says that with rare exception, any federal agency that wants to issue a regulation must subject its proposed version to a public notice and comments period. The agency also must examine the potential impact the rule would have on the environment and small businesses. The process also allows those who oppose a new regulation adequate time to prepare any possible legal challenges they may wish to mount, including seeking possible injunction to block its enforcement.

The OSHA emergency standard did none of these things because it wasn’t considered a formal rulemaking, but instead was viewed as an order needed to address an emergency. There is nothing new about the Supreme Court’s jaundiced view of these actions. Since OSHA began issuing ETS orders in the 1980s, five of the eight that were imposed were struck down by the court.

The Supreme Court’s recent decision yanking on the reins of the Environmental Protection Agency (EPA) addressed a different form of administrative overreach. The court declared the EPA went too far when making new regulations because it was attempting to create new national policy—a role assigned to Congress—instead of enforcing laws written by Congress.

More Separation of Powers

The court determined EPA did not have the authority under the Clean Air Act to reorder the composition of the nation’s energy portfolio, as it had attempted to do to further the Obama administration’s self-generated Clean Power Plan, which Congress had not originated nor voted to approve.

The court’s majority said it “expects Congress to speak clearly if it wishes to assign to agency decisions of vast economic and political significance.” Instead, the Obama administration’s Clean Power Plan “effected a fundamental revision of the statute” in a way never intended by Congress. The plan also adopted a cap-and-trade scheme for carbon, a course of action which Congress had consistently rejected.

Another court action that went little noticed in the news media at the time is more important because of what the justices did not do. The Supreme Court without comment declined to review California’s law stripping truck owner-operators of their independent contractor status. The lawsuit, which was brought by the California Trucking Association, was of intense interest to many in logistics and freight transportation management.

The state law established a three-prong “ABC” test to determine whether someone is an independent contractor or an employee. The sticking point is the test’s new “B” section, which declared that someone cannot be considered an independent contractor if they are in the same line of business as the employer. Thus, no truck driver can be considered an independent contractor if they lease their truck and services to another trucking company.

The change was long sought by the Teamsters and other unions groups who could not organize these drivers not because of their independent contractor status. This unionization campaign also extends to ride share drivers who work for Uber and Lyft and home delivery services like DoorDash.

Not only does the state law virtually wipe out almost a century-long traditional trucking practice, it is being seriously considered by other states and was included in the sweeping labor law legislation the Democrats failed to get passed.

Supreme Court decisions can be vastly important, both the ones that spark great public controversy and some that that go barely noticed. Throughout history some decisions stirred fierce emotions and sometimes generated violent political blowback that shaped our history.

The heated language, sometimes violence and widespread scenes of rageful civil disobedience that arose from the Roe vs. Wade decision are nothing new. Some of us still remember what happened after the Supreme Court struck down school segregation in 1956,which also had been considered “settled law.” Mobs gathered and screamed at the first Black students entering white schools, state and local politicians embraced a strategy they called “massive resistance” and there were calls for the impeachment of justices, or worse.

Employers need to keep an eagle eye out for what the court does next in several different areas, and remain aware even when you think they are wrong, the justices are applying rigorous, thoughtful analysis to the cases that come before them, regardless of what you may hear shouted from the sidewalks in front of their homes or hear loudly brayed on partisan television shows.

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