The administrative state marches on at the Trump Department of Labor

I haven’t written much about the Department of Labor since Alex Acosta resigned as Secretary of Labor. However, in this post, written after Gene Scalia became the new Secretary, I complained that the DOL was still pursuing its specious “pay discrimination” case against Oracle.

The culprit is the Department’s Office of Federal Contract Compliance Programs (OFCCP). During the Obama administration, OFCCP became a bastion of leftism. It pursued radical theories of pay discrimination, the goal of which is to force companies to pay male and female employees the same rates with little regard for the work they actually perform and the relevant experience they bring to the job.

Silicon Valley became a prime target of the Obama OFCCP. On its way out the door, the Obamaites filed pay discrimination cases against Oracle, Google, and Palantir. Under Alex Acosta, the DOL pursued these cases (the one against Palantir settled). Under Gene Scalia, it has continued to do so.

Indeed, according to this article by Cory Andrews of the Washington Legal Foundation, Scalia has done nothing much to curb the OFCCP. Andrews says that “since Secretary Scalia assumed his post in September 2019, the OFCCP has seemingly grown more strident under his watch.” (Emphasis added) “At the same time,” he continues, “Secretary Scalia has had nothing to say about OFCCP’s ultra vires enforcement regime.”

Andrews correctly views the OFCCP as an extreme example of the rise of the administrative state, under which inordinate power resides in the hands of largely unchecked bureaucrats:

If [the OFCCP] suspects a federal contractor or subcontractor of violating one of the anti-discrimination provisions in a government contract, the OFCCP doesn’t refer the matter to the DOJ to sue for breach of contract in federal court. Nor does it refer the company to the EEOC for further investigation and possible action under Title VII.

Instead, the OFCCP brings an administrative enforcement action against the accused before the Labor Department’s own administrative law judges. Appeals from that adjudication? The Labor Department decides the appeal, too. . . .

Yet the most extraordinary thing about the OFCCP’s adjudication process is that Congress has never authorized it. With a straight face, the OFCCP claims an LBJ-era executive order—Executive Order 11,246—as the source of its authority to conduct administrative adjudications.

But that order identifies no statutory authority for the OFCCP’s adjudicative process. It requires only that government officials include a set of anti-discrimination provisions in government contracts. And it contemplates that the Department of Labor may, after consulting with the contracting agency, sanction an offending contractor by cancelling the contract or by suspending the contractor’s ability to contract with the government.

It doesn’t authorize an entire regime to bring, prosecute, and then adjudicate discrimination claims, or to obtain injunctive relief and back pay for employees of government contractors. Not even EEOC can do that without going into court.

(Emphasis added)

It’s true that the OFCCP’s decisions are ultimately subject to judicial review in federal court. But Andrews notes that Chevron deference to administrative agencies gives the OFCCP a leg up in court. Moreover, companies targeted by OFCCP may be forced to expend huge amounts of resources at the administrative level before getting a day in court. Many knuckle under.

Given the OFCCP’s extraordinary power, it is vital that the Secretary of Labor, who at least reports to an elected official (the president), prevent blatant administrative overreach. Alex Acosta refused to do so. So far, if Andrews is right, Gene Scalia has chosen the same course.