Agency Independence at Risk With Target on Firing Protections

The EEOC is the latest federal agency to face a lawsuit arguing that its leadership is unconstitutionally protected from being fired at will by the president, threatening the independence of this and other workplace rights enforcers from White House control.

Two coalitions of Republican states led by Tennessee Attorney General Jonathan Skrmetti recently cited the protections Equal Employment Opportunity Commission members have from being removed in separate lawsuits raising objections to the agency’s Pregnant Workers Fairness Act regulations and enforcement guidelines on workplace harassment.

Over the past several years, a handful of US Supreme Court cases have rolled back statutory safeguards meant to insulate independent agencies from political pressure. Citing those rulings, businesses, advocacy groups, and Republicans opposing Biden administration policies now are urging the lower courts to expand on them.

“You should take these claims seriously,” said Jane Manners, a law professor and legal historian at Temple University. “The court is definitely entertaining them.”

The EEOC-focused suits follow SpaceX’s multi-pronged constitutional challenge to the National Labor Relations Board that includes a claim against board members’ removal protections. The National Right to Work Legal Defense Foundation also argued against those shields, though one of the conservative advocacy group’s lawsuits was dismissed on standing grounds.

And the Federal Trade Commission has faced similar claims as part of efforts to overturn the agency’s rule banning employee noncompete agreements.

The Supreme Court’s 2010 decision in Free Enterprise Fund v. Public Company Accounting Oversight Board kicked off a string of Supreme Court opinions on the constitutionality of the president being unable to terminate agency heads, holding that dual-layered protections—when officials can only be fired by agency leaders who are themselves shielded from removal—violate the Constitution.

Then in 2020, Seila Law LLC v. CFPB held that the Constitution only permits removal protections for multi-member agency commissions, or for “inferior officers” who have “limited duties and not policymaking or administrative authority.”

The court a year later in Collins v. Yellen said the president must have direct firing authority over leaders whose agencies are involved in “important work.”

Supreme Court Shield

But a 90-year-old Supreme Court decision appears likely to stymie the most recent challenges, provided the justices don’t rework or overturn it.

The high court fashioned a bulwark for independent agencies with its 1935 decision in Humphrey’s Executor v. United States, which held that Congress can restrict the president’s power to oust officials at agencies that perform quasi-judicial and quasi-legislative functions.

Earlier this year, the US Court of Appeals for the Fifth Circuit, a court known for its willingness to limit agency power, relied on that case to reject a challenge to the for-cause removal protections for the members of the Consumer Product Safety Commission.

The claims against EEOC commissioners’ removal protections similarly fail under that precedent, said Andrea Katz, a professor at Washington University School of Law in St. Louis who focuses on constitutional law and presidential power.

The big question, however, is what the current, conservative-majority Supreme Court might do with Humphrey’s Executor, she said.

Two justices—Clarence Thomas and Neil Gorsuch—have expressly said the court should scrap that precedent, Katz said.

Gorsuch joined Thomas’ concurring opinion in Seila Law that said continuing to rely “on Humphrey’s Executor to justify the existence of independent agencies creates a serious, ongoing threat to our Government’s design,” and that the court “simply cannot compromise when it comes to our Government’s structure.”

Federal Reserve, Tradition

But weakening or overturning Humphrey’s Executor creates the potential to rob the Federal Reserve System of its independence from the White House, a factor that could give the Supreme Court pause.

“That’s the biggest potato, quite frankly,” said Cary Coglianese, a law professor at the University of Pennsylvania. “And there I do think it would make a huge difference if the heads, the Board of Governors of the Federal Reserve, felt like they had to listen to what the president said or be fired.”

Justice Samuel Alito attempted to lay the groundwork for overturning Humphrey’s Executor by carving out the Federal Reserve from its impact in his dissent from a decision earlier this month upholding the Consumer Financial Protection Bureau’s funding structure, said Lev Menand, a law professor at Columbia University. Gorsuch joined that dissent.

But a concurring opinion from that same decision adds to the reasons that the EEOC commissioners’ removal protections might be safe, said Jed Shugerman, a law professor at Boston University.

Penned by Justice Elena Kagan and joined by Justices Sonia Sotomayor, Brett Kavanaugh, and Amy Coney Barrett, the opinion emphasized the court’s “continuing tradition” in interpreting the Constitution and signaled a reluctance to upend the administrative state.

Unlike the EEOC, the agencies at issue in Free Enterprise Fund, Selia Law, and Collins are all relatively new, having been created after 2000, Shugerman noted.

“That suggests the EEOC may be safer than some people assumed, especially 60 years after the Civil Rights Act was passed,” he said.