The Trump administration’s chief wage enforcer has spent her early weeks in office seizing command of routine casework from her agency’s regional offices and blocking approval of Obama-era investigation tactics, according to Labor Department sources and internal emails.
Cheryl Stanton, who was sworn in as administrator of the Labor Department’s Wage and Hour Division April 29, quickly rescinded all authority previously delegated to her subordinates. The move ensures the former business lawyer has the final say on many of the minimum wage, overtime pay, and family leave investigations that her agency’s vast bureaucracy handles in a given week.
Stanton’s heightened oversight of the division’s more than 60 regional and district offices reflects an attempt to better grasp ongoing operations to start to develop an eventual agenda. She has already begun to gradually return some of the authority to regional administrators and their staff on a piecemeal basis. But in its initial weeks, Stanton’s policy has sparked alarm among career officials, delayed the recovery of back pay employers owe workers, and frozen the agency’s processing of time-sensitive visa applications for victims of workplace crimes.
“Earlier this week I asked that each of you inform me by close of business tomorrow all delegations of the Administrator’s authority in any form to others including but not limited to signatures,” Stanton wrote May 9 to her senior WHD assistants, according to an email obtained by Bloomberg Law. “Effective immediately and going forward all such delegations are revoked and any such actions taken by others besides me are invalid.”
Stanton effectively gave herself a long list of responsibilities, such as issuing subpoenas and banning companies that violate wage and hour laws from federal contracts, that previous administrators had already delegated to the regional office heads. She has since restored subpoena power to the regional administrators, and is considering returning other delegations case by case, sources said.
Still, the wage-hour chief’s blanket revocation of authority to the regional and district directors who oversee the daily policing of workplaces has halted the agency’s use of several key enforcement tools deployed during the Obama administration. The sources said Stanton has yet to approve a number of enforcement actions that were greenlit by regional offices and have now been awaiting her signature for up to six weeks. These include visa certifications for victims of workplace abuse and trafficking; enhanced compliance agreements in settlements, which generally require more egregious violators to take steps to ensure future compliance; and requests for court orders that prevent the shipment of “hot goods” produced by companies found in violation of the Fair Labor Standards Act.
Stanton arrives at the DOL after a stint running the South Carolina Department of Employment and Workforce, which doesn’t cover wage-and-hour law. She previously spent nearly a decade at private law firm Ogletree Deakins, where she defended businesses in labor and employment lawsuits.
“As part of my due diligence as the head of a large government agency, I thought it was prudent to understand the authorities delegated from the Administrator to others in the agency,” Stanton said in a June 18 statement to Bloomberg Law. “The work continues as I approve these items that now cross my desk. I am fully committed to enforcement of the law through strategic, data driven approaches that get workers the money they are owed as quickly as possible.”
‘A Troubling Message’
Tammy McCutchen, the agency’s first administrator in the George W. Bush administration, characterized Stanton’s orders as “pretty standard” for a new division head getting the feel for her job.
“You have to learn. You have different priorities based on the president and the secretary’s priorities,” said McCutchen, now a Littler Mendelson attorney who represents companies under investigation by the department. “So it’s perfectly reasonable to pause some things that might’ve been controversial before you determine if that’s a priority for you.”
But former WHD official
“To revoke all the delegations of authority that the regional administrators have traditionally had is sending a signal to the field that the national office doesn’t trust them to use their experience and judgment and knowledge to exercise what heretofore had been fairly routine authorities,” said Hancock, whose career at the agency spanned three presidents and multiple administrator initiations. “It’s a troubling message.”
During the first two plus years of
Stanton’s heavy involvement in enforcement minutiae signals that the Obama-era investigatory strategies that worker advocates championed for protecting vulnerable employees may soon be erased from the federal government’s playbook. Under the helm of David Weil, the previous administration’s WHD prioritized data-driven targeted enforcement in low-wage industries and cases alleging independent contractor misclassification.
Stanton’s moves will also likely encourage management attorneys and business representatives who have complained that the Trump WHD has been slow to reverse what they felt were needlessly punitive strategies. This includes the collection of liquidated, or double, damages as part of many back pay settlements, which the agency frequently relies on to deter violations and to make workers whole.
DOL officials have pointed to enforcement statistics as evidence that the Trump administration hasn’t backed away from protecting workers, despite efforts to get businesses to voluntarily comply with the law. The division collected a record-setting $304 million in back pay owed to employees in fiscal year 2018.
Stanton has authorized the WHD to hire 25 additional investigators across the country, the first hiring since the Obama presidency, DOL sources said.
‘We Will Take it From There’
Stanton’s May 9 email was initially met with panic when relayed to the division’s career leadership away from Washington, said the DOL sources, who spoke on condition of anonymity out of fear of reprisal. For a newly sworn in administrator to take an active interest in her agency’s investigatory footprint is common. But to stop enforcement actions until the boss gives them approval, and sometimes indefinitely pause cases, was unheard of to some sources.
Career officials didn’t know what parts of their job they would still be permitted to do. Some worried that revoking all authority meant the nation’s some 800 WHD investigators could no longer conduct any probes.
After receiving backlash from the field, Stanton followed up the next day in an attempt to clear up the confusion.
“Send me a blank copy of any routine forms that need to be signed to further an investigation or front line work. I will review them immediately and if appropriate confirm in writing that such routine, investigatory form is exempt” from the revocation policy, Stanton wrote in a May 10 email to staff. “Please also make clear to the field that they need not panic if they come across a routine, investigatory form that has not yet been exempted from the revocation—simply get it to me and we will take it from there.”
Between the followup email, Stanton separately conveying to the field her commitment to tough enforcement, and her plans to hire new investigators, the administrator has partially assuaged some fears from career leaders that they would be handcuffed from doing their jobs, sources said.
But Stanton is still holding up cases at the beginning, middle, and end stages by requiring her signature. And on the more politically divisive matters like enhanced compliance agreements and visas, Stanton’s assurance that she will “take it from there” has thus far not led to a response. She hasn’t given the field any indication as to how much longer she will be mulling her approval in those instances.
Hancock, the former WHD official who is now an attorney representing workers at Cohen Milstein in New York, said the impact of Stanton’s directives will be tough to undo.
“To come in and just use a meat ax to say I don’t trust the field to do a professional job and I’m going to assume for myself authority for virtually everything that the organization does, that’s not a good message,” he said. “That genie is going to be hard to put back in the bottle.”