Labor & Employment Law Daily Wrap Up, LITIGATION NEWS, TRENDS—Two employers have now challenged constitutionality of OSHRC’s review proceedings, (Apr 18, 2025)

By Brandi O. Brown, J.D.

Both lawsuits cite SEC v. Jarkesy in support of their claims.

In separate lawsuits filed in Texas and New Jersey, two employers—one a steel fabrication business and the other a pumping services provider—are arguing that the Occupational Safety and Health Review Commission’s review proceedings are unconstitutional, citing the U.S. Supreme Court’s decision in SEC v. Jarkesy for support.

In Jarkesy, the Court held that when the SEC seeks civil penalties against a defendant for securities fraud, the Seventh Amendment entitles the defendant to a jury trial. In doing so, the Court upheld a Fifth Circuit decision already being used by other plaintiffs as the basis for arguments against the constitutionality of other administrative review proceedings involving the use of ALJs, such as ones involving the NLRB.

OSHRC proceedings in question. Now, in two recent complaints, employers are seeking to rely on Jarkesy to attack proceedings before the OSHRC. In Flying A Pumping Services, LLC v. OSHRC, filed in a federal district court in Texas earlier this week, the employer alleges that it received and was contesting an OSHA citation when the Secretary of Labor filed a complaint with the OSHRC in March 2024. The citation was issued after an employee was killed when a high-pressure hose ruptured while he was performing pump maintenance. The citation was for willful violation of the General Duty Clause. In addition to denying that it violated the OSH Act, the employer asserts in its complaint that the Occupational Safety and Health Review Commission lacks jurisdiction over the matter.

The case is No. 1:25-cv-00058-H.

In Kenric Steel, LLC v. DOL, first filed in a federal district court in New Jersey last year, but recently amended, the employer alleges that the U.S. Acting Secretary of Labor, acting through the U.S. Solicitor of Labor, “is pursuing an unconstitutional and illegal administrative proceeding against” it in the form of an OSHRC proceeding. It alleges that when Congress enacted the OSH Act, it violated separation of powers “by placing both executive power—the power to enforce the law—and judicial power—the power to render judgments about the application of the law—in the hands of the Executive Branch.”

In the amended complaint it contends that the structure of the OSHRC violates the Constitution in multiple ways, including that “because it is purportedly an executive agency, Members of the Review Commission are unconstitutionally insulated from removal” and because the OSHRC’s “ALJs are unconstitutionally appointed and, once appointed, unconstitutionally insulated from removal.” Additionally, the employer argues that it is “being deprived of its right to a jury trial regarding purely legal remedies sought by the Secretary.” The employer argues that the ALJ’s adjudication of the citation without a jury trial violates the Seventh Amendment and Article III, citing Jarkesy.

The case is No. 1:24-cv-09221-KMW-SAK.

Trump’s memo. The Trump administration, too, is pushing for reconsideration of the legality of enforcement proceedings. Last week the White House issued a memorandum to executive department and agency heads with the subject heading “Directing the Repeal of Unlawful Regulations.” The Oval Office also issued a fact sheet about it. The memo instructs its recipients to identify “certain categories of unlawful and potentially unlawful regulations” and “begin plans to repeal them,” stating that the effort “shall prioritize, in particular,” evaluation of “each existing regulation’s lawfulness” under certain U.S. Supreme Court decisions, including, among several others, Jarkesy.

As described by the Trump administration, the Court in Jarkesy “held that it violates the Seventh Amendment for agencies to adjudicate common-law claims in their in-house courts. Agencies accordingly must repeal any regulation authorizing enforcement proceedings that enable the agency’s courts to impose judgments or penalties that can only be obtained via jury trial in Article III Courts.”

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