Resolving ALJ Removal Protections Problem Following Lucia

Abstract

When the Supreme Court decided Lucia v. SEC and held that administrative law judges (ALJs) are Officers under the Constitution, the Court opened a flood of constitutional issues around the status of ALJs and related government positions. One central issue relates to ALJs’ removal protections. ALJs currently have two layers of protection between them and the President. In an earlier Supreme Court decision, the Court held that two layers of tenure protection between an “Officer of the United States” and the President was unconstitutional as it deprived the President the power to hold his officers accountable. As impartial adjudicators, ALJs need those layers of protection to ensure fair adjudicative hearings. Lucia now threatens ALJ protections. This Note argues that implementing a peremptory challenge system which would allow each party in an adjudicative hearing to remove the ALJ from hearing its case would create an avenue in which the Court could justify the removal issue. Such a proposal would fix executive oversight concerns about the President being unable to properly implement his policy. Additionally, peremptory challenges would allow litigants in front of an agency be able to remove ALJs they feel are predisposed to the agency. By addressing both constitutional issues, the Court may be more likely to find that the two layers of tenure protection in place are permissible for those in adjudicatory positions. INTRODUCTION................................................................................ 694 I. APPOINTMENT AND REMOVAL OF ALJS AND LUCIA.............. 696 A. Congress Enacted Protections to Keep ALJs Independent from their Agency ........................................................ 697 B. Lucia Designated ALJs as Officers of the United States...... 698 C. The President Has the Power to Remove His Officers Which Now Includes ALJs ............................................ 701 II. ALJ REMOVAL PROTECTIONS VIOLATE THE APPOINTMENTS CLAUSE ...................................................... 702 A. The Court’s Decision to Not Define “Significant Authority” Threatens the Independence of Hundreds of Agency Employees........................................................ 702 B. Removal Protections Raise Constitutional Issues .............. 704 1. Removal Protections Limit Presidential * J.D. Candidate, May 2020, University of Michigan Law School. I would like to thank the Michigan Journal of Law Reform editors for their feedback and comments through the process. I would like to thank Professor Nicholas Bagley for his comments on an early draft, and I also appreciate the helpful comments from Laurence Batmazian and Gregg Coughlin. 694 University of Michigan Journal of Law Reform [Vol. 53:3 Supervisory Oversight............................................ 704 2. Removing ALJ Tenure Protections Raise Due Process Concerns ........................................... 706 III. PROPOSED SOLUTIONS TO THE APPOINTMENT AND REMOVAL OF ALJS ............................................................... 708 A. Removing MSPB’s For-Cause Layer of Tenure Protection... 708 B. Changing the Good Cause Standard .............................. 709 C. Establishing an ALJ Corps ........................................... 710 D. Providing ALJs with Article III Tenure Protections ........... 711 E. Move Appointment and Removal to Article III Courts....... 712 IV. SOLUTION TO APPOINTMENT AND REMOVAL...................... 713 A. Defining an Officer for Appointment.............................. 714 B. At-Will Removal of ALJs with Peremptory Challenges in a Hearing .................................................................... 715 1. Mechanics of a Peremptory Challenge System .... 715 2. Peremptory Challenges Resolve Competing Constitutional Concerns........................................ 718 3. Potential Challenges of a Peremptory System...... 720 4. Carving Out an Exception to Free Enterprise Fund ........................................................................ 724 CONCLUSION ................................................................................... 726