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In this episode of our Safety Perspectives From the Dallas Region podcast series, shareholders John Surma (Houston) and Frank Davis (Dallas) discuss the U.S. Department of Justice’s (DOJ) recent statement concluding that the removal restrictions for administrative law judges (ALJs) are unconstitutional. Frank and John explore the implications of this decision for employers, particularly those facing OSHA citations, and examine its broader impact on the evolving legal landscape of OSH Act enforcement. 

Transcript

Announcer: Welcome to the Ogletree Deakins Podcasts, where we provide listeners with brief discussions about important workplace legal issues. Our podcasts are for informational purposes only and should not be construed as legal advice. You can subscribe through your favorite podcast service. Please consider rating this podcast so we can get your feedback and improve our programs. Please enjoy the podcast.

Frank Davis: Good morning and welcome to another episode of Safety Perspectives from the Dallas Region. My name is Frank Davis. I’m a shareholder with Ogletree Deakins, sitting here in Dallas, Texas. With me, I have my law partner, John Surma, and he is broadcasting to you from our offices down in Houston, Texas. Good morning, John.

John Surma: Good morning, Frank. It’s nice to talk with you and to our audience. Welcome y’all aboard for another episode, and we hope will be intriguing, interesting, and at least moderately entertaining. We can’t promise any of them, but we certainly enjoy chatting with each other, and we hope that you enjoy listening to us.

Frank Davis: We usually don’t say anything that dates these podcasts too much, but we’re about halfway through the President’s first 100 days. We’ve seen some significant changes in the legal landscape. This might be, John, one of our last podcasts as the Dallas region because it looks like DOGE is getting a hold of OSHA now and looking at doing some restructuring that is likely to cause the relabeling as they go through the restructure.
Too early to predict what that restructure is going to look like. It’s interesting, you said interesting, and that’s what made me think about it. It’s another interesting change that’s likely coming up in the next few weeks. For instance, we know that there’s a likely reduction in force coming up that will undoubtedly impact occupational safety and health administration, as well.

John Surma: Well, there certainly has been a lot of change and a lot of things happening on very short notice and with very little fanfare. And you and I recently talked about an informal conference where we made a trip out of town that I wouldn’t otherwise have made had I known the Friday before my Monday informal conference the area director retired and the sole and distinct purpose for going out of town for that informal conference was to meet with that area director because the citations were signed by the assistant area director.
I really felt talking to the area director was going to add some value, whereas talking to the assistant area director I did not think was. As it turned out, it proved to be the case. And this stuff is happening very, very quickly, and this stuff is happening in a lot of cases without a great deal of fanfare and public announcement.
And so, staying abreast of what’s going on, and you and I routinely communicate about developments not just in the Dallas region, but throughout OSHA and having a little bit of a finger on the pulse of what’s going on is critical this time around, to coin a phrase. Because quite frankly, things are happening so fast and so often that it’s hard to keep up and you constantly have to be recalibrating what your game plan is.

Frank Davis: Yeah, I agree with that, and that takes us to the article I wanted to discuss with you. It’s an article written by you actually, February 26th earlier this year talking about the new challenges. Your title for the article, “New Challenges Loom for OSHA and OSHRC Amid Quorum Issues, Potential ALJ Removals, and Recent Supreme Court Jurisprudence.” But I’d like your subtitle better.
I grew up listening to Bob Dylan. You said, “The Times They Are a-Changin.” The times certainly are a changing in many areas of government. The one I would like to talk about a little bit though is the Department of Justice’s recent view or opinion that they released concerning the effectiveness of administrative law judges working for the Department of Labor.
And by way of background, I’m just going to actually pluck this right out of your most excellent blog post because the structure’s good, but we start with the Occupational Safety and Health Review Commission. We call it OSHRC. Sometimes we call it the Review Commission. As many of our listeners know, it’s an independent agency that reviews and resolves disputes between employers and OSHA.
The Review Commission was created by Section 12 of the Occupational Safety and Health Act of 1970. It’s designed to be a three-person panel that requires at least two members to have a quorum. Without a quorum, the Review Commission, sorry, can’t act. They can’t issue final decisions.
However, only one member can select a case for review. Now, the members of the Review Commission are appointed by the President of the United States subject to the advice and counsel or advice and consent of the U.S. Senate. And that is a higher level than the first level of review for an OSHA citation. So, when OSHA issues a citation, if an employer challenges, it doesn’t go directly to the Review Commission.
It goes to another level of judges called the administrative law judges (ALJs), and ALJs are hired through a bidding process. They’re not appointed by the President of the United States, and traditionally, they have been protected from removal. And that’s where I want to start with our discussion, John, is how is that structure set up? Why are judges protected by two levels of removal and why is that important for our discussion today?

John Surma: That’s a great question, Frank, and I think different folks are going to have different answers to that question. I think at the end of the day, the idea behind having multiple layers of protection between the ALJ judges and the president is designed to ensure that those folks who are… I mean, functionally, they are civil servants just like postal workers and social security agents, etcetera.
I mean, these aren’t elected. They aren’t appointed. They’re selected civil service employees. They’re going to be protected from the political whims of whoever is holding the position of president. The Commission itself is at least arguably subject to some of those political whims inasmuch as they’re subject to selection by the president with the advice and consent of the Senate.
And so, there is that level of political influence. But then I think the idea behind having the ALJs subject to these protections or protected by these protections is to eliminate the politics and to eliminate the “you’re here today, gone tomorrow” type element that might otherwise exist.

Frank Davis: I think that that’s actually a really good description and intuitive end-game analysis. The issue with that, however, is that that structure has recently fallen under Constitutional scrutiny. The Supreme Court, at the end of its 2023 to 2024 term, issued a couple of significant decisions related to executive branch authority. One of those was a case that originated out of the Fifth Circuit, the Circuit Court of Appeals for Texas, Louisiana, and Mississippi. That case was called SEC v. Jarkesy.
The Supreme Court case concluded a narrow analysis of an employer’s right to jury trial and said that because an administrative law judge lacked the authority to oversee a jury trial, that the SEC lacked authority to issue the quasi-judicial decisions out of the ALJ branch for SEC. But the Jarkesy decision that came out of the Fifth Circuit was broader than that. It went beyond the jury trial, and it actually analyzed that two layers argument that you mentioned.
And while the Supreme Court didn’t take it up and adopt that as a national precedent, a local judge in your hometown down there in Houston out of the Southern District of Houston, Judge Sim Lake, a senior district court judge, did issue a decision based on the Fifth Circuit’s conclusions in the local Jarkesy case that applied only to Texas, Louisiana, and Mississippi. How is that decision relevant to our discussion today?

John Surma: Well, Judge Lake basically adopted the Jarkesy outcome as the Fifth Circuit developed it fully, whereas the Supreme Court only adopted one of three reasons that the Fifth Circuit found the SEC administrative courts to be unconstitutional. The reason this is relevant to our discussion today is that Judge Lake, in the case that we’re talking about, issued an order that prevents the administrative courts that are promulgated under the Department of Labor from handling any litigation.
And so they’re effectively stopped from engaging in the normal judicial acts associated with these courts going forward. And, as a result of the fact that he found that all three of the functions were met, so one is the multiple layers of protection, two is the fact that these are not Article III courts, or by Article III courts, they’re talking about U.S. District Courts, and the third fact being that the defendants or respondents don’t have the right to a jury trial because these are Fifth Circuit’s opinion.
These are kind of a quasi-criminal proceeding, and therefore you should be entitled to a jury trial. And Judge Lake basically said for all three of those reasons, these courts are unconstitutional. And for all three of those reasons, he’s enjoining those courts from acting.

Frank Davis: So, as of October 30th, 2024, under Judge Lake’s order, the Department of Labor administrative law judges were enjoined from being able to hear cases. Is that the short summary?

John Surma: That is absolutely correct. And I should say that is true as relates to the Fifth Circuit and in particular Texas. There are other courts in jurisdictions that have issued similar orders that have enjoined courts in different parts of the country from hearing proceedings.

Frank Davis: I think that that’s certainly germane when we’re talking about OSHA because OSHA tends to follow whatever decision comes out of the circuit court for the area in which the specific OSHA office sits. So, in our case, when we’re talking about Dallas region, we’re certainly talking about Texas. Of course, the Fifth Circuit also extends to Mississippi and to Louisiana, which are outside of the Dallas region. But nevertheless, it might be as broad as that. I haven’t spent time thinking about that.
Nevertheless, this is certainly a relevant consideration for the Department of Justice that the Office of the Solicitor General that sits in Dallas. Since the order was issued by Judge Lake on October 30th, 2024, the Department of Justice was vigorously defending its position arguing that, no, the court got it wrong, that ALJ should be able to hear these cases. But the Department of Justice changed its position recently as of February 20th, 2025. What happened then, John?

John Surma: Well, that’s an interesting day in as much as there was a memo that was issued to Senator Charles, more commonly known as Chuck, Grassley, and it was a memo from the Solicitor General in Washington, D.C., the acting Solicitor General. So, this is an appointed position, and the appointed person has not been through the advice and consent process. And so, there’s an appointed acting person, Sarah M. Harris.
She issued a letter to Senator Grassley basically indicating that the Department of Justice concluded that the multiple levels of removal restrictions violated the Constitution and the Department of Justice would no longer defend those entities in court or in any ongoing litigation. So, breaking that down into layman’s terms, if a party challenges the constitutionality of the ALJ’s handling the cases that the ALJs are handling, the Department of Justice is not going to defend those cases. That’s the short version of the story.

Frank Davis: So, does that make Judge Lake’s order, does that convert it from a TRO to a permanent injunction under the current structure?

John Surma: No. It may have the functional effect of doing so, but certainly until Judge Lake himself converts it, it does not. But instead, what this really does, at least in my opinion, and I’m curious as to what your opinion is, in my opinion, what it does is it basically tells the administrative courts… We’re talking about under OSHRC, but this would apply to all administrative courts.
That if a party raises the fact that the judge handling their case has multiple layers of protection against removal, that the Department of Justice is not going to defend those courts. And I don’t know if that then means it’s now on the agency to take up that representation if it’s now on the Solicitor of Labor to take up that representation or if that means nobody’s going to defend it. But one way or the other, whoever’s defending it, it’s not going to be the Department of Justice Solicitor General handling those cases.

Frank Davis: I think anything that we say from there is speculative. But if there’s a challenge, and arguably since it’s a constitutional challenge, arguably even if you consent to a trial, I’m not even sure that that trial could ultimately be binding, right?

John Surma: Well, I mean, if it’s not constitutional and if the Department of Justice is saying that it’s not constitutional, theoretically at least it wouldn’t seem that it could be binding. Now, having said that, like everything else, everything goes in cycles. And so, if you had an outcome let’s say adverse to your employer in that process, and we roll into a new administration in four years, would that administration take the same position about the constitutionality of these administrative law judges and these courts?
And if they don’t, would they then be able to engage in some sort of enforcement actions? My suspicion is that absolutely they could because you’d have a judgment or functionally the equivalent of a judgment lodged against that employer. And that employer, having been more or less sat quiet through the process, wouldn’t have any basis on which to subsequently claim, well, hey, look, that Department of Justice said this was an unconstitutional process, so you can’t now enforce the judgment. I think the action has to be taken now.

Frank Davis: Well, I don’t disagree with that, but what I was aiming at is the courts have ruled the structure of the DOLs, ALJs to be unconstitutional. And if you look back to New Process Steel v. the Labor Board back in 2010, even though those employers submitted their cases to the Labor Board, the Supreme Court later said it was unconstitutional and those decisions didn’t count because the Labor Board didn’t have a quorum.
So, it was unconstitutional as the cases were heard. And that occurred after the cases had been decided. So, I’m guessing that there could be a belated challenge, so long as the courts continue to hold that the structure is unconstitutional. That was the point I was trying to make.

John Surma: I think it’s a good point, but I think it also highlights there’s a difference there between what the Supreme Court is going to do or might do versus what the agency and the next administration might do. And I mean, I certainly think, and this is another point in the article, at the end of last term, Justice Thomas indicated in the Allstates Refractory case where Allstates Refractory was trying to appeal from an OSHRC decision, and the Supreme Court refused Allstates‘ appeal.
Writ of certiorari is the technical term for it. And where there was a denial of that writ of certiorari, Justice Thomas pointed out that, hey, look, there’s five justices that say that the rulemaking authority that was delegated to OSHA is unconstitutional, and this is a case that we should take up so that those five justices can essentially coalesce and have a majority that says that that rulemaking grant was unconstitutional.
I mean, I think there’s other moves in the Supreme Court, and there’s other foreshadowing by Justice Thomas and others to indicate that, in time, that outcome could in fact happen. I just don’t know that we’re quite there yet.

Frank Davis: Yeah. So, let’s move away from cases, appeals, and precedent, and let’s talk about something more practical and probably of higher interest to our employees. Do these decisions mean that OSHA can no longer conduct inspections?

John Surma: Oh, absolutely not. Absolutely not. I mean, OSHA by the terms of the act, and Frank, I know that you and I are sometimes viewed by certain people as kind of geeky or nerdy or whatever the right term is for it, but I’ll let my geekdom or nerdom out in full force and just remind folks. And I tell folks just on a regular basis, if you hadn’t read the OSHA Act and this is where you live, you really need to spend some time reading it and periodically re-review it.
It seems like every time I go back and read it, I remind myself of things that I forgot, or I see things in a new light. And this is one of those things where it’s really important to remind ourselves that the act is a piece of legislation. And until there’s new legislation that reverses the act, or until we get to such point in time, as the court said, the act is unconstitutional, the agency under the act still has the same authority as it’s had for the last 74 years.
And so, from the standpoint of its ability to enforce its own regulations, it still has the ability to engage in inspections, issue citations, do all the other things that it’s historically done. It just when it comes to the contest of those citations that it may have some issues.

Frank Davis: So, if you get a citation and you can’t settle a case, the next step is to appeal it to contests, to have in contests being to take it before a trial or a fact of some sort. Traditionally, it’s been to go before the administrative law judges established by the Department of Labor. How long do you have to wait if you can no longer go to those Department of Labor judges before OSHA can’t pursue judicial relief anymore? Is there a time?

John Surma: Well, I mean, there’s two ways I could answer it. The really short, smart-alecky way I could answer that question is TBD, to be determined. I think time will tell. And five years from now, we’ll have real solid explanations for what our prognostication is. I think today it’s a little bit of a guess as to what the outcome is. Realistically based on current operational practices, etcetera, I think six months to a year is probably where it’s at.
But I think it’s something that I know you’re doing, and it’s something that I’m doing. These issues need to be raised very early on and repeatedly raised that you’re essentially going through the process under protest. Because at least as it currently sits, even where Judge Lake’s order would have effect, OSHA is proceeding, and the Solicitor of Labor is proceeding as though that enjoiner doesn’t exist or doesn’t have any operational impact.
And at a certain point, you’re going to waive those arguments if you don’t raise them early, and don’t raise them often, at least in my opinion.

Frank Davis: Again, it’s a bit speculative because we are in uncharted territory. No doubt. So, what’s next? My penultimate question before we let everybody return to their scheduled workday.

John Surma: Well, I mean, look, there’s one other piece that we haven’t talked about, which is part of that article, and that is OSHRC has one current commissioner, Commissioner Attwood. Commissioner Attwood’s term expires in late April.

Frank Davis: Of this year.

John Surma: Yeah, I’m sorry. Good point, of this year. There’s some speculation, some of it informed, some of it I think just good solid hunches, that it’s unlikely that there’s going to be another commissioner appointed. So, at present, OSHRC does not have a quorum. You have to have two members in order to have a quorum. There’s zero members. There’s only one member at this point in time. After Commissioner Attwood’s term expires at the end of April, there’ll be zero commissioners.
And if nobody’s appointed, that could remain the case for the next three plus years. So, arguably the commission can’t even pick from the cases that are before it to select cases for it to review when it does have a quorum. And so, I think that that means that the wheels just completely grind to a halt save and accept these efforts to push things forward that the agency and the Solicitor Labor will likely engage in.
But that, at some point, I think is going to peter out because there’s just too many challenges in the way for them to proceed past a certain level, unless you’re talking about folks that don’t have counsel and aren’t aware of all the things that are going on with OSHRC at this point.

Frank Davis: John, thank you for your insights. Thank you for your good work on keeping up with these blog posts and keeping us up to date as to what’s going on. I don’t have anything else for you today. I look forward to our next meeting and our next podcast.

John Surma: Well, Frank, thank you so much. I appreciate the kind words. I appreciate you taking some time this morning to record this with me. And to our audience, I appreciate you joining us, and we look forward to doing this again.

 

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