This is the first part of a multi-part series regarding the implications that Constitutional Appointment Clause challenges have for prior and current administrative hearings before the Department of Labor.

Lucia v. SEC

On June 21, 2018, the Supreme Court issued Lucia v. SEC, an important case clarifying the definition of “inferior officers” under the United States Constitution’s Appointments Clause. In Lucia, the Supreme Court, applying the Appointments Clause doctrine, determined that Administrative Law Judges (ALJs) of the Security and Exchange Commission (SEC) were “inferior officers” because they exercised significant discretion in their decision-making.  If the court determines that a federal employee is an “inferior officer,” then the Constitution requires that Congress vest their appointment in either the President, Congress, or a Department Head.

In the federal government, a Department Head is the individual appointed by the President and confirmed by the Senate to oversee a federal agency. For example, SEC Commissioners are the five Department Heads of the SEC. The ALJ that decided Lucia’s case, however, was appointed by SEC staff and not the Commissioners. For this reason, the Supreme Court found that his appointment was unconstitutional and remanded the case to be reheard by a different and properly appointed ALJ.

Does Lucia Extend to Administrative Decisions Decided by the Department of Labor (DOL)?

Admittedly, the Supreme Court limited Lucia to only SEC ALJs. Yet, after the decision, claimants quickly began to draw parallels from Lucia to make Appointments Clause challenges to other federal agency decisions. Although it is not clear whether Lucia extends to other agencies, the DOL has preemptively conceded that their ALJs are inferior officers; and as such, in accordance with Lucia, must be appointed in compliance with the Appointments Clause of the Constitution.

Perhaps anticipating the result in Lucia, on December 12, 2017, United States Secretary of Labor, R. Alexander Acosta, issued letters ratifying the appointments of the existing DOL ALJs. Arguably, this made all ALJ decisions after that date safe from Appointments Clause challenges. Yet, this has not prevented injured claimants from seeking to vacate — through a motion for reconsideration — an ALJs prior decision denying benefits.

In Part two, we will discuss the outcome of injured claimant’s motions for reconsideration based on the Appointments Clause and explore what future implications Appointments Clause challenges can have going forward.