President Issues Executive Order Changing Process for Hiring ALJs

On July 10, 2018, President Trump issued an Executive Order that allows agency heads to directly hire administrative law judges (ALJs) by excepting them from the federal government’s general competitive service requirements.

The Executive Order comes on the heels of the Supreme Court’s recent decision in Lucia v. SEC, in which the Court held that the SEC’s ALJs are “officers” of the United States who must be appointed in compliance with the Constitution, which for “inferior officers” would generally require appointment by the President or “heads of departments”—in that case, the Commission itself.  Because the ALJ in Lucia had been appointed by other SEC staff members, the Court vacated the ALJ’s decision and remanded the case for a new proceeding.

Previously, the federal government’s nearly 2,000 ALJs, the majority of which are employed by the Social Security Administration, were hired through a competitive examination and competitive service selection procedures administered by the Office of Personnel Management.  Citing Lucia and certain additional policy justifications, such as the need to provide agency heads with additional flexibility, the Executive Order places ALJs into a new category of the “excepted service,” a group of federal employees who are subject to a different hiring process.  For personnel in the excepted service, appointments and position changes generally must be made in accordance with such regulations and practices as the head of the agency concerned finds necessary.  In connection therewith, the Executive Order also specifically requires that all ALJs must at a minimum hold a professional license to practice law and be authorized to practice law under the laws of a state, the District of Columbia, Puerto Rico, or any territorial court established under the United States.

Although the Executive Order appears to have been prompted at least in part by the Lucia decision, it is not entirely clear that all of the steps taken in the Order would have been required in order to comply with the minimum Constitutional requirements at issue in that case.