Courts to Rule on Agency Powers: The Kiplinger Letter

Decisions made by the judiciary can have a major impact on the economy, industry and therefore on your personal finances. Given its importance, our highly experienced Kiplinger Letter team produces regular updates on key events in this space. 

Our experienced Kiplinger Letter team will update you on all the important developments (Get a free issue of The Kiplinger Letter or subscribe). You will always get updates first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest… 

The Supreme Court will consider whether to topple the Chevron doctrine in a blockbuster case later this year. A quartet of N.J. fishing companies are asking SCOTUS to overturn a 1984 ruling that courts should defer to agencies when they offer a reasonable interpretation of an unclear legal statute.

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While the high court has already weakened Chevron in previous rulings, overturning the doctrine would still result in a huge regulatory shake-up, imperiling not just future rules, but ones that have been on the books for years.

Lower courts would be even better able to clip an agency’s wings. And Congress would play an even greater role in setting the template for executive branch regs, possibly resulting in even more specific legal statutes.

The justices have agreed to hear a related case on the constitutionality of the funding system of the Consumer Financial Protection Bureau (CFPB). Both cases will be part of the Supreme Court’s next term, which starts in October.

Appeals court to determine if occupational safety rules are legal

Keep an eye on a related case now working through the Federal Courts. An appeals court will soon decide the legality of safety rules by OSHA (the Occupational Safety and Health Admin) covering hazards ranging from falls to electrocution, in response to a challenge brought by an Ohio contractor.

The basic question is whether Congress delegated too much authority to OSHA when it passed the Occupational Safety and Health Act in 1970. The law specifies that OSHA rules should be “reasonably necessary or appropriate to provide safe and healthful employment and places of employment,” a purview that critics say is too broad and should have been narrowed by lawmakers. 

History is on OSHA’s side

Defenders of OSHA say this is needed to take the best advantage of the agency’s technical expertise.

History is likely on OSHA’s side. Courts have previously set limits on the agency’s rulemaking authority without invalidating it completely. For example, OSHA can issue only regulations that are “economically [and] technically feasible.” This lawsuit does not challenge OSHA health rules. The Supreme Court has already upheld the agency’s authority to issue such regulations, within limits.

This forecast first appeared in the Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to the Kiplinger Letter or try a free issue.