The Supreme Court’s highly-anticipated decision in Loper Bright Enters v. Raimondo overturned decades-old precedent requiring courts under Chevron USA v. Natural Resources Defense Council, Inc. to defer to federal agency interpretations of an ambiguous statute. This ruling will have momentous implications for administrative law, far beyond the regulations at issue in that particular case.
Among the effects the ruling will have on federal agencies overall, it will uniquely impact how the Occupational Safety and Health Administration (“OSHA”) issues formal adjudications and crafts its regulations. In particular, the decision will likely create new defenses to citations, restrain the scope of future rules, and invite more detailed Congressional legislation.
Case Summary
For nearly four decades, Chevron controlled how courts analyzed both administrative agencies’ interpretation of statutes (particularly those that give the agency the authority to operate), and the actions resulting from such interpretations. Under Chevron, an agency had to follow a statute’s clear and explicit language, but where the statute had ambiguity—as those for regulatory agencies often do—federal courts had to give binding deference to an agency’s interpretation as long as such interpretation was reasonable, even if the court would have interpreted the statute differently. Courts owed this deference even where an agency changed its interpretation, as long as the revised interpretation remained reasonable.
Loper Bright brought that deference to an end: “Courts must [now] exercise their independent judgment in deciding whether an agency has acted within its statutory authority, as the [Administrative Procedure Act (“APA”)] requires.” The Court explained that the APA “directs that . . . ‘the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action’”—all part of the court’s traditional role under the separation of powers. In performing this function, courts may give “[c]areful attention” to agency interpretation, but they no longer need to follow “mechanically” such assessments as Chevron once required. With this reversal of precedent, the Court ushered in a new age of regulatory law, including how OSHA will operate under the Occupational Safety and Health Act (“OSH Act”), the statute that created the agency and gave it the power to create and enforce workplace safety regulations.
Consequences for OSHA
Turning to how the Loper Bright decision may affect OSHA’s regulation of worksite safety, several developments could emerge, including: (1) additional defenses to a citation’s alleged violations; (2) more consistent agency interpretations of statutes; (3) more carefully crafted regulations; (4) greater variation nationwide in governing regulations; and (5) greater expertise required from Congress.
Additional Defense to Citations – Regulation Beyond OSHA’s Authority
Employers facing an OSHA citation now have an additional potential defense—that OSHA lacked the authority under the OSH Act to promulgate the regulation underlying the citation. To prevail in this defense, employers would need to convince a court that OSHA’s legal basis for the regulation arose from an incorrect interpretation of the OSH Act. If an employer succeeds, the regulation becomes null and void, and so too does the citation. Although pursuing such a defense may carry significant litigation costs well above typical OSHA penalties, in certain instances, the long-term benefit of eliminating burdensome regulations and their associated costs may make practical business sense.
More Consistent Regulations
Because courts previously had to defer to agencies’ interpretations of statutes, even when they changed, OSHA rulemaking and enforcement tended to vary with changes in executive branch leadership. With courts freed from giving binding deference to such varying interpretations, courts can interpret the OSH Act provisions and have that precedent remain controlling unless overturned by the Supreme Court.
Varying Statutory Interpretations Across Circuits
While Loper Bright may eliminate varying agency interpretations of statutes, it may also lead to inconsistent court interpretations. Different courts may reach different conclusions about whether an OSHA action fell within the proper interpretation of its underlying statute. Thus, some courts may find OSHA exceeded its authorization from Congress, while others may not, leading to an OSHA regulation becoming enforceable in one circuit, but not in another. With such variation, employers will need to pay close attention to court decisions to ensure their regulatory compliance.
More Constrained Regulations
With OSHA no longer able to rely on the wide latitude Chevron deference afforded to the range of regulations OSHA could create, OSHA will have to engage in more careful rulemaking. Going forward, OSHA will have to create regulations that will survive judicial scrutiny about whether the rule falls within the agency’s power under the OSH Act. Thus, future regulations will likely adhere more tightly to precisely what the OSH Act authorizes.
Safety Standards Directly From Congress
As Loper Bright returns the authority to interpret statutory ambiguity to the courts, establishing particular safety standards may require explicit direction from Congress about the authority OSHA has to create and enforce such regulations. For example, Congress may have to expressly grant OSHA the authority to create workplace requirements for vaccinations and other health measures for certain infectious diseases, as the Court previously found such measures outside workplace safety and thus OSHA’s authority. More detailed legislation, however, requires greater technical expertise from Congress and greater cooperation, both of which seem in short supply, especially where members commonly capitalize on statutory provisions to make ostentatious objections.
Conclusion
The upheaval from Loper Bright’s overruling of Chevron will reverberate for years, in particular for OSHA compliance. Although the new regulatory landscape has opened the door to new defenses to citations and changes in safety regulations’ scope, uncertainty could emerge from different circuit court rulings and greater congressional involvement in workplace safety standards. In such a regulatory environment, advancing business interests will require thoughtful consultation with a full support team, including counsel.
