SCOTUS Strikes Down Chevron Doctrine in a 6-3 Vote

What was the Law?

Since 1984, federal courts have been required to defer to federal agencies in interpreting the law when it is unclear or ambiguous.  A regulatory agency, such as the Department of Labor (DOL), publishes its own rules regarding statutes passed by Congress when statutes allow openings that do not explicitly authorize or prohibit the agency’s rule.

How has it Changed?

The decision that required federal courts to take a “hands off” approach (Chevron v. Natural Resources Defense Council) was overturned by the Supreme Court on June 28, 2024.  “The Administrative Procedure Act requires courts to exercise their independent judgment in deciding whether an agency has acted within its statutory authority, and courts may not defer to an agency interpretation of the law simply because a statute is ambiguous,” wrote Chief Justice John Roberts, handing authority over statutory interpretation back to the federal courts.

What is the Effect on Employers?

Federal agencies that regulate employer-employee relations and hold employers accountable, (including the National Labor Relations Board (NLRB), Equal Employment Opportunity Commission (EEOC), and DOL) may now have less power and will likely push forward with rules that are narrower in scope and closer to the underlying statute.  The demise of Chevron will influence many ongoing challenges to agency rule making, such as the NLRB’s “joint employer” rule and the DOL’s increase of the salary threshold for exempt employees.

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