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Senate to Spotlight Labor Pick Scalia’s Past Litigation

Sept. 18, 2019, 2:20 PM

Senators will dive into labor secretary pick Eugene Scalia’s lengthy career as a high-powered corporate attorney at his Sept. 19 confirmation hearing, even as his nomination is on a fast track for approval.

The Senate Health, Education, Labor, and Pensions Committee will convene to question Scalia as the Labor Department he would inherit is primed to to push out several new regulations, including an update to overtime pay requirements. But what lies ahead likely will take a back seat at the hearing to Scalia’s decades as a labor and employment attorney for Fortune 500 companies.

Democrats are expected to relitigate the Gibson Dunn partner’s fierce opposition to the Clinton administration’s workplace ergonomics standard; his successful court challenge to vacate the Obama administration’s fiduciary rule; and the dozens of other legal cases in which Scalia represented businesses, such as UPS, Walmart, and Ford, opposite their employees.

Scalia’s advocacy against the ergonomics rule was a key part of the Democratic-majority Senate’s refusal to hold a vote for him in 2001 when he was nominated for labor solicitor. That led President George W. Bush to give Scalia a recess appointment for the job. Nearly two decades later, the defunct rule—which was intended to prevent workplace-induced musculoskeletal disorders—isn’t nearly as fresh on lawmakers’ minds. But Scalia has played a lead role in more recent anti-regulatory litigation on behalf of business clients, like fighting new conflict-of-interest restrictions for retirement advisers.

Several HELP Committee Democrats, including Sens. Doug Jones (Ala.), Tammy Baldwin (Wis.), and Jacky Rosen (Nev.) said in interviews that they have concerns about Scalia’s business ties that they hope to address in more detail at the hearing.

Still, Scalia’s testimony will allow him to demonstrate his expertise on the laws the Labor Department enforces and his commitment to strong enforcement of worker protections during a one-year stint as the department’s chief legal officer in 2002. Whether it was pressuring West Coast shippers to agree to a longshoremen’s union demands in a drawn-out port dispute or battling Enron to protect the retirement savings of employees after the company collapsed, Scalia was known for respecting the agency’s mission when he was the labor solicitor.

HELP Committee Chairman Sen. Lamar Alexander (R-Tenn.) and other supporters are likely to argue that Scalia once again would commit to upholding the agency’s mission to protect workers the moment he were to switch from private attorney to Cabinet member. They can point to a letter supporting Scalia’s nomination signed by 13 former career DOL attorneys who worked under him when he ran the department’s legal shop in the George W. Bush administration.

“Certainly it looks like the hearing is setting itself up to be contentious, and I think that’s too bad because this is probably one of the more substantive nominees we’ve had for secretary of labor in decades,” said Michael Eastman, a senior vice president at the employer association the Center for Workplace Compliance. “It’s hard to think of someone who understands labor and employment law better among recent nominees to be secretary.”

Long Legal Career

Sen. Patty Murray (Wash.), the panel’s top Democrat, has criticized the Republican leadership for prematurely scheduling the hearing without providing enough time to vet the nominee. Murray and others plan to contrast Scalia’s private-sector resume with the labor secretary’s responsibility to stand up for workers on the job, said a Senate Democratic aide.

“I’m still reviewing his work and his prior tenure at Labor,” said Baldwin, the Wisconsin Democrat. “I have concerns that his career has been devoted to advocacy for very harmful corporations, and I want to see working people be the focus.”

After leaving the department in 2003 and returning to his old firm, Scalia went on to expand his practice and take on more sophisticated administrative law cases challenging several worker-friendly Obama-era DOL regulations. His duty at Gibson Dunn to represent clients’ best interests in the courtroom doesn’t let him off the hook if senators grill him on his personal views, said Celine McNicholas, government affairs director at the Economic Policy Institute, a left-leaning think tank.

“It’s one thing to say I did the bidding of clients, but then I think it’s important to ask, ‘how do you view government regulation as a tool in promoting worker protections or does it have no place?’ I think those are all very fair questions that have very little to do with his record as a corporate management attorney,” McNicholas said.

“The Secretary of Labor is supposed to protect working people. There are some really important rulemakings, like overtime protections, that are pending at the Labor Department,” said Lynn Rhinehart, a former general counsel of the AFL-CIO. “Senators need to press Scalia on these issues, find out where he stands, and what kind of commitments he’s willing to make.”

Sen. Tim Scott (R-S.C.) said he has “no concerns” about Scalia, son of the late Supreme Court Justice Antonin Scalia, a strong voice for conservative jurisprudence for three decades.

Scott’s fellow HELP Committee Republican Sen. Susan Collins (Maine) said she’s reserving judgment until after the hearing. The centrist Collins is frequently a swing vote on the panel, although lawmakers could still confirm Scalia without her approval. Any bid by Democrats to sink the nomination would require a few Republicans to vote against Scalia, making it a longshot at best.

Alexander already announced that the committee will vote Sept. 24 on whether to send Scalia’s nomination to the full Senate for a final vote.

Regulatory Agenda

Scalia’s testimony comes as the Labor Department is preparing to unveil a final rule to expand time-and-a-half overtime pay access to an estimated 1 million workers. That is about a quarter as many workers that would have become entitled to overtime pay under an Obama administration version of the rule that was struck down in court.

Democratic state attorneys general and worker advocates are strategizing to mount a legal challenge to the rule after it’s finalized in the coming days. But Scalia is likely to dodge questions on the rule, pointing to its incomplete status.

The DOL also is finalizing a proposed rule to expand apprenticeship programs, an issue that has raised opposition from building trades unions who are concerned a new secretary could tweak the final rule to undermine their long-established apprenticeship system. Yet Scalia would again have a simple response if queried on the rule.

“Remember, you’re dealing with probably the most able administrative lawyer in the United States; if something is in rulemaking, Gene is going to wait to see what the comments in the rulemaking are,” said William Kilberg, Scalia’s mentor at Gibson Dunn and a former DOL solicitor in the Nixon administration. “That’s not just a strategy; that’s reality. He believes in this. So what can he say other than, ‘I’ll study it when I see the comments.’”

—With additional reporting by Jaclyn Diaz

To contact the reporter on this story: Ben Penn in Washington at bpenn@bloomberglaw.com

To contact the editor responsible for this story: Terence Hyland at thyland@bloomberglaw.com