By Summer Maughan.
The nondelegation doctrine is the principle under the separation of powers that the legislative branch cannot delegate its lawmaking power and authority. The pivotal reason behind the doctrine is to ensure that elected representatives and government officials subject to constitutional accountability make legislative decisions. In the current era where courts are limiting the discretion and authority of regulatory agencies, Arizona has joined the party.
In July of 2022, the Arizona Supreme Court struck down rules and procedures incorporating federal law that were adopted by the Arizona Department of Administration (AZDOA) pertaining to overtime compensation for law enforcement personnel. In Roberts v. State, the court ruled that as a regulatory agency, the AZDOA does not have the authority to decide major public policy decisions. This ruling articulates a stricter delegation standard in Arizona law that more clearly aligns with the nondelegation doctrine outlined in the Arizona Constitution.
The State Legislature Cannot Delegate the Authority to Decide Major Public Policy Decisions Inherently Legislative in Nature
Two state corrections officers brought this suit against the State of Arizona on behalf of a class of similarly-situated officers alleging Arizona is in violation of A.R.S. § 23-392. The officers claim this statute requires Arizona to pay overtime for the time corrections officers spend in pre-shift security screenings. The Superior Court granted the state’s motion to dismiss, concluding that Arizona had implicitly adopted the Portal-to-Portal Act (“Portal Act”), an amendment to the Fair Labor Standards Act which specifies that activities preliminary or postliminary to the principal activity of employment are not compensable, and therefore the security screenings were not compensable. On appeal, the Arizona Court of Appeals affirmed the ruling that the Portal Act was incorporated through A.R.S. § 23-392 and agency regulations, but it held that the pre-shift security screenings were in fact compensable under the Act.
The Arizona Supreme Court granted review to determine (1) to what extent the Portal Act had been incorporated into A.R.S. § 23-392, (2) the meaning of the language in § 23-392, and (3) whether the legislature had properly delegated to the AZDOA the authority to incorporate federal law beyond what § 23-392(A) does. First, the court held that the language of the statute did not broadly incorporate federal law but merely referred to the section of federal law regarding job classifications, and therefore, the Portal Act was not implicitly adopted and did not apply to the officers’ claims. Second, the court held that the statute provided no express delegation of power to the AZDOA and therefore an incorporation of the Portal Act in A.R.S. § 23-392 violated the separation of powers outlined in Arizona’s constitution. However, the court took their decision one step further. The court ruled that (1) the legislature alone may determine the type of major policy question that incorporating the Portal Act into Arizona law constitutes because the decision is “inherently legislative in nature, and the legislative power is inalienable;” and (2) the legislature “must first make the policy choice,” and then may delegate the power to an agency like the AZDOA to implement the policy. Ultimately, the court declined to determine whether prior decisions or any statutory provisions govern the operable definition of “work” as it pertains to overtime compensation for corrections officers, deferring to the trial court to consider on remand.
What Is the Standard Going Forward?
Arizona is one of many states with an express separation of powers clause in its constitution. The Arizona Constitution explicitly divides the powers of the state government into the legislative, executive, and judicial, and states that “such departments shall be separate and distinct, and no one of such departments shall exercise the powers properly belonging to either of the others.” Since 1971 Arizona courts have upheld the delegation of power to administrative agencies to make rules and regulations as long as the parameters of the delegation were sufficiently articulated. Typically, the subject matter of the delegation did not influence the constitutionality of the delegation; the clarity of the delegation did. Under this standard, the terms of the delegation did not need to be “express” as long as the agency could understand the bounds of the delegated authority. The recent ruling in Roberts articulates another standard similar to the commonly held opinion in the Arizona courts prior to 1971: the discretion of what a law shall be rests exclusively with the legislature, but a legislature may delegate the authority or discretion over the execution of the law.
The opinion in Roberts does not purport to strike the previous opinions of the Arizona Supreme Court which state that legislative delegations of authority must be sufficiently stated so the delegee can understand the bounds of the conferred authority. Instead, the opinion merely adds to this existing standard. Going forward, a constitutional delegation of legislative authority under Arizona law appears to require: (1) that the delegation not confer authority or discretion to create major public policies, as those are inherently legislative in nature; and (2) that the parameters of the delegation be sufficiently articulated so the delegee may understand the bounds of the delegated authority.
How Does this Impact Arizonans?
It is still unclear what the governing standard for overtime compensation regarding law enforcement personnel will be because the Roberts litigation is still pending in the Arizona lower courts. However, the Arizona Supreme Court ruling immediately puts both the Arizona State Legislature and regulatory agencies on notice. The legislature must exercise its own authority in creating laws and major public policies instead of deferring such work to agencies. Likewise, agencies can no longer rely only on the language of the delegation to exercise authority if the language grants the authority to create major public policy.
One initiative regarding regulatory agency authority that Arizona voters should look out for in the upcoming election is Arizona Proposition 315, which would require that any proposed rule projected to increase regulatory costs by $100,000 in the state within five years after implementation be submitted to the Office of Economic Opportunity. If the Office of Economic Opportunity finds that the proposed rule will increase regulatory costs in the state by $500,000 within five years after implementation, then the rule must be ratified by the legislature before it can take effect. This proposition seeks to constrict the authority of regulatory agencies even more and direct ultimate authority back to the legislature, which unlike regulatory agencies, is not insulated from public approval.
Whether Arizonans decide to pass the proposition or not, the Roberts ruling has already restored significant legislative power back into the hands of accountable elected representatives that cannot be delegated away again.
Summer Maughan is a 2L at Arizona State University Sandra Day O’Connor College of Law. For several years before starting law school, she worked at a civil litigation firm in Chandler, AZ that specializes in defending claims against private and public entities. She plans to pursue a career in litigation following graduation and is especially interested in labor and employment law. When Summer is not studying or working she enjoys running, hiking, and baking for her husband Collin.