Originally uploaded at SSRN.

Abstract

The single largest cadre of federal adjudicators goes largely ignored by scholars, policymakers, courts, and even litigating parties. These Administrative Judges or “AJs,” often confused with well-known federal Administrative Law Judges or “ALJs,” operate by the thousands in numerous federal agencies. Yet unlike ALJs, the significantly more numerous AJs preside over less formal hearings and have no significant statutory protections to preserve their impartiality. The national press has recently called attention to the alleged unfairness of certain ALJ proceedings, and regulated parties have successfully enjoined agencies’ use of ALJs. While fixes are necessary for ALJ adjudication, any solution that ignores more widespread, less independent, and less litigant-protective AJ adjudication falls woefully short.

This Article argues that, contrary to agency orthodoxy and regardless of regulated parties’ interests, agencies should choose ALJs over AJs to further their own interests. With broad direction to choose AJs or ALJs, agencies prefer the former because of increased control over AJs’ job performance and policy implementation in flexible, informal proceedings — all for less cost. Yet, not only are the relative informality and cost savings of AJ proceedings exaggerated (based on data that this Article is the first to consider meaningfully), but controlling AJs has overlooked downsides. Control undermines AJs’ perceived impartiality, creating unacknowledged due process concerns under two recent Supreme Court decisions — Caperton v. A.T. Massey Coal Co. and Free Enterprise Fund v. PCAOB — and complicating agencies’ missions. Choosing ALJs also increases the likelihood of agencies receiving deferential judicial review and absolute official immunity for agency adjudicators. Thus, this Article broadens and contextualizes the current ALJ controversy by highlighting the more pervasive and problematic phenomenon of AJs in administrative adjudication.

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