A recent decision issued by the Supreme Court of the United States in Perez v. Mortgage Bankers Association could allow the Mine Safety and Health Administration (MSHA) to revise longstanding interpretations of regulations without formal rulemaking. On March 9, 2015, a unanimous Court struck down the Paralyzed Veterans doctrine requiring agencies to utilize notice-and-comment rulemaking for new rule interpretations varying significantly from previous interpretations. The Court determined that requiring formal rulemaking for revisions of prior rule interpretations is contrary to the Administrative Procedure Act (APA).
Under the APA, agencies must provide notice of proposed new rulemaking and allow the public an opportunity to submit comments prior to the rule’s promulgation, modification, amendment, or repeal. This requirement has not typically applied to so-called “interpretative rules” until the District of Columbia Circuit Court of Appeals extended the requirement to material changes of prior interpretations. The case was Paralyzed Veterans of America v. D.C. Arena L.P., 117 F.3d 579 (D.C. Cir. 1997). This produced a split in the circuit courts as to whether notice-and-comment rulemaking is necessary.
The Fifth Circuit Court of Appeals agreed with the Paralyzed Veterans decision, but the First and Ninth Circuits did not. This split presented the opportunity for the Supreme Court to address the issue. In Mortgage Bankers Association, which involved a U.S. Department of Labor reinterpretation of wage and hour rules, the Court held that notice-and-comment rulemaking is not required for reinterpretations because the APA allows agencies to amend interpretive rules without notice-and-comment rulemaking. The Court noted, “Because an agency is not required to use notice-and-comment procedures to issue an initial interpretive rule, it is also not required to use those procedures when it amends or repeals that interpretive rule.”
The Federal Mine Safety and Health Review Commission until this time has applied the now-rejected D.C. and Fifth Circuit position. In RAG Shoshone Coal Corp., 26 FMSHRC 75 (Feb. 2004), for instance, the Review Commission rejected an MSHA effort to revise an earlier interpretation of regulations for the collection of bimonthly respirable coal dust samples. The citations at issue were based on procedural requirements outlined in a list of occupational codes, memorandum, and policy letter. The Review Commission held that the procedural requirements constituted a substantive rule that required notice-and-comment rulemaking because there would not have been an adequate basis for the citations without them.
The Review Commission’s position has been that APA notice-and-comment procedures do not apply to “interpretive rules,” but they do apply to “legislative rules.” Relying on the Fifth and D.C. Circuits, the Review Commission declared a legislative rule is “one that substantively amends the language of a regulation, whereas an interpretive rule clarifies or explains the regulation’s existing language.” The Review Commission adopted the D.C. Circuit’s position that “[a]n agency may not escape the notice and comment requirements by labeling a major substantive legal addition to a rule a mere interpretation.”
Inevitably, the Secretary of Labor will argue that the Review Commission’s longstanding position conflicts with the Supreme Court’s decision in Mortgage Bankers Association, holding that changes to an interpretive rule are not subject to notice and comment no matter how significant they may be. Future MSHA efforts to reinterpret prior interpretations will no longer be subject to the Paralyzed Veteran’s doctrine. The agency may revisit past reinterpretation efforts that were beaten back by stakeholder insistence that formal rulemaking procedures are indispensable.
As one example of past events, in November 2010, MSHA issued a program policy letter requiring disclosure of conditions found in every mandatory workplace examination record. (Industry saw this as a roadmap for inspectors.) The planned reinterpretation conflicted with an existing interpretation that all that is necessary is a showing of who examined what and when. Faced with stakeholder demands for public rulemaking for the planned additional requirement of recording conditions, MSHA abandoned the reinterpretation effort. More recently, MSHA implemented modifications to enforcement policies regarding what constitutes a “repeated” flagrant violation. MSHA also reinterpreted its pattern of violations enforcement requirements. With respect to the latter, the Review Commission ruled that notice-and-comment rulemaking was not required. The holding has been challenged by the mining industry in the U.S. Court of Appeals. The Supreme Court’s decision in Mortgage Bankers Association will now be central to resolving that case.