OFCCP Week In Review: July 2022 | DirectEmployers Association

Thursday, June 30, 2022: SCOTUS Reigned In The Federal Agencies By Reminding Them They Must Identify “Clear Congressional Authorization” When Making Significant Decisions…Not So Much Trimming Rights As Trimming Presidential Power

On the final day of its current term, the Supreme Court of the United States issued a ruling that will immediately restrict the President’s power to exercise “Executive Fiat” to impose policies that Congress has not specifically delegated to him and his federal agency heads. SCOTUS used the case of West Virginia v EPA to reign in the Environmental Protection Agency’s (“EPA’s”) clean air emissions cap Rules and to warn federal agencies more generally in the process to be careful to always root their policy-making in federal statutes in which Congress clearly charged them to act. Now gone are the days the President and federal agency heads could simply invoke a general right to act in their areas of assigned responsibility and try to “lead the Congress” to come around to the President’s point of view.

The SCOTUS thus ended its term by continuing to restrict federal Executive Branch power to act in derogation of the rights the Constitution reposes in the state and federal territorial legislatures (that was the Dobbs decision reversing the Roe (abortion) decision returning broad powers back to the fifty state and federal territorial legislatures). And now in this EPA case, SCOTUS has shipped legal authority back to the U.S. Congress reminding and restricting federal Executive Branch agencies not to overstep their delegated boundaries. The Nation is watching in real time the balancing of the three branches of the federal Government the country’s Founders envisioned to not allow any one of the three major branches of the federal government to get too powerful relative to the other two branches. Advocates of a powerful centralized federal government were appalled by the West Virginia decision while advocates for a much smaller federal government charged just with health, safety, welfare, and national defense duties were elated at what they perceived to be a re-balancing of power away from a rampaging Executive Branch both Democrats and Republicans have been driving forward.

SCOTUS Seized on the “Major Question Doctrine” To “Hit The Brakes” on the President’s Runaway Exercise of Power

Here is the background: Section 111(d) of the Clean Air Act (codified in federal law as 42 U.S.C. §7411(d) and used interchangeably with “Section 111(d)” in the SCOTUS decision) granted the EPA the authority to devise emissions caps based on the generation-shifting approach the Agency took in its Clean Power Plan (CPP) Rule (that the Obama Administration issued in 2015). In the majority opinion, Chief Justice Roberts wrote that pursuant to “the major questions doctrine, given both separation of powers principles and a practical understanding of legislative intent, the agency must point to ‘clear congressional authorization’ for the authority it claims” to make when it makes “decisions of vast economic and political significance.”

As we have previously written (see, Thursday, February 10, 2022: Eight States Bring Two Suits Seeking to Enjoin $15/Hour Minimum Wage for Employees of Federal Contractors & Subcontractors), the “Major Questions Doctrine” is an approach to statutory interpretation which precludes the Executive Branch from issuing Rules with deep economic and political significance where Congress did not expressly assign that power to The President.

Roberts went on to determine that the EPA’s effort to regulate greenhouse gases by making industry-wide changes violated the Major Questions Doctrine. Section 7411 of the Clean Air Act was “designed as a gap filler” and has rarely been used, Roberts noted, adding that Congress had previously rejected efforts to enact the kind of program that the EPA wanted to implement with its CPP Rule. As such, there was “little reason” to think that Congress gave the EPA the authority, pursuant to Section 7411, to issue its CPP Rule, and thereby, exercise “unprecedented power over American industry.” Although the provisions of the CPP Rule may be sensible policy, “[a] decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to a clear delegation from that representative body,” Roberts wrote.

Therefore, the U.S. Court of Appeals for the District of Columbia Circuit erred when it interpreted the Clean Air Act to give the EPA expansive power over carbon emissions, the Court concluded. The Biden Administration had planned to issue a new Rule on carbon emissions from power plants, rather than reinstating the Clean Power Plan Rule, which the Trump Administration repealed and replaced.

Justice Gorsuch wrote a concurring opinion, joined by Justice Alito, in which he further elaborated on what he saw as the merits of the “Major Questions Doctrine.”

The decision was yet another 6-3 ruling, with Justice Kagan writing a dissenting opinion joined by Justices Breyer and Sotomayor. Kagan vehemently disagreed with the majority’s conclusion that the EPA did not act under the authority that she asserted that Congress had in fact conveyed to EPA in Section 111 (aka 42 U.S.C. §7411) of the Clean Air Act. Rather, Kagan concluded that Congress had broadly authorized the EPA in Section 111 to select the “best system of emission reduction” for power plants. Here, the parties did not dispute that “generation shifting” was the best system to accomplish Congress’ generally stated goal of emission reduction. (“Generation shifting” is the shorthand term to describe shifting the generation of power from one source of power (perhaps from fossil fuels) to another power source (perhaps to solar sources). The majority’s reasoning “rests on one claim alone: that generation shifting is just too new and too big a deal for Congress to have authorized it” in Section 7411, Kagan wrote. “A key reason Congress makes broad delegations like Section 111 is so an agency can respond, appropriately and commensurately, to new and big problems,” according to Kagan.

In a statement condemning the decision, President Biden stated that his Administration “will continue using lawful executive authority, including the EPA’s legally-upheld authorities, to keep our air clean, protect public health, and tackle the climate crisis. We will work with states and cities to pass and uphold laws that protect their citizens,” and that “will keep pushing for additional Congressional action.”

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