Five Things NFIB is Doing to Cabin Agency Discretion

Date: November 08, 2016

The NFIB Research Foundation’s latest Problems and Priorities Report confirms that over-regulation remains one of the top issues plaguing the small business community. In fact, “unreasonable regulations” ranks 2nd out of 75 potential problems facing small business—behind only “Cost of Health Insurance.” And of course, everyone knows that the rising cost of health insurance has a lot to do with regulation as well. (See E.g., The “Affordable” Care Act).  
Suffice it to say, the regulatory state is out of control. But that’s why NFIB Small Business Legal Center’s efforts are so very crucial. And while this is an uphill fight, we’re making progress—especially pushing-back against government bureaucrats who believe that they should have unfettered discretion to fill-in “gaps” in statutory language. 
Here is a run-down of five steps that we’ve taken in recent months to reign-in in the regulatory state—and to ensure principled limits on state and federal agencies: 

1.  Shining a light on the problem. The first step to recovery is acceptance that we have a systemic problem. Accordingly, we are working to educate the small business community on the latest regulatory developments. (E.g., sign-up for our upcoming webinar on DOL’s new overtime rule). And we are also drawing special attention to the problem of agency overreach. Notably, NFIB Legal Center released a report documenting numerous examples wherein the Obama Administration had circumvented basic rulemaking requirements to impose burdensome new rules without even allowing the small business community an opportunity to comment.
 
2.  Suing federal agencies. To show we mean business, the National Federation of Independent Business is suing the Obama Administration over numerous rules that we maintain were illegally promulgated—without lawful authority, and without going through the proper procedures. For example, in one of our latest lawsuits, NFIB seeks a court order to block enforcement of a controversial OSHA rule that requires small businesses to allow union officials to accompany OSHA inspectors during health and safety inspections. As we argue, federal agencies do not have authority to revise previously promulgated regulations without going through formal notice-and-comment procedures.   
 
3.  Holding agencies to the text. Both in our lawsuits and amicus practice, NFIB has consistently advocated against allowing agencies to re-write statutes. For example, we recently filed an amicus brief, in SW General v. NLRB, urging the Supreme Court to reject the U.S. Solicitor General’s argument that the Court should give deference to a statutory interpretation pronounced by an agency in an internal memorandum. As we argued, no deference was appropriate because the officials failed to explain how their interpretation was rooted in the text of the statute at issue. 
 
4.  Calling for an end to agency deference all together. We would not be in the position we are today if it were not for a series of Supreme Court decisions holding that courts should generally defer to interpretations of federal agencies. But as we argue, it should be for the courts to say what the law is—not the Executive Branch. And while it may be some time before we have a chance to overturn these cases, NFIB Legal Center is, nonetheless, aggressively pushing the issue. For example, in United States v. Texas, and in Flytenow v. FAA, we argued that it was time for the Court overturn Auer v. Robbins—an especially controversial opinion that has long allowed federal courts to defer to an agency interpretation of a statute, even when the agency has failed to go through formal rule-making procedures.
 
5.  Fighting in state court as well. NFIB Legal Center is also fighting aggressively to reign-in agency over-reach at the state level. For example, in California Insurance Association v. Jones, NFIB led a coalition of industry groups in an amicus brief before the California Supreme Court, arguing that courts should begin with the understanding that agencies only have those powers specifically conferred upon them by statute. As such, we argue that it is improper to assume statutory authority from legislative silence. Luke A. Wake, Senior Staff Attorney at the NFIB Legal Center, explains more about the importance of this issue and NFIB’s work in this Daily Journal podcast.
 

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