The Tide of DOL Opinion Letters Has Ebbed and There Likely Won’t Be Many More Under the Current DOL Administration. That is too bad.

 “One of the greatest mistakes is to judge policies and programs by their intentions rather than by their results.” – Milton Friedman

The United States has a robust federal labor law enforcement scheme. Through the Fair Labor Standards Act, Service Contract Act, Davis-Bacon Act, the Contract Work Hours Safety Standards Act and other wage and hour laws, the Department of Labor (“DOL”) protects 148 million workers in the United States. Employers big and small are required to comply with these laws and, as our clients know, it can be difficult. One thing that can make it a bit easier is the process by which the Wage and Hour Administrator issues Opinion Letters to clarify uncertainties in the rules.  

Employers (who are not currently involved in litigation concerning the issue that they are seeking clarification for) can email DOL detailing the facts of their situation and request an opinion from the Wage and Hour Administrator. The Administrator will write an opinion that interprets the wage and hour laws and applies those laws to the facts as the employer relates them. But it isn’t a completely binding ruling as an employer could have withheld information and DOL makes no independent investigation into the facts. Then DOL publishes the resultant opinion letters to furnish administrative guidance. The Portal-to-Portal Act allows employers, whose facts match up identically with those in the opinion letter, to point at the administrative guidance as a complete defense to liability, or (even if the match isn’t perfect) as a mitigating factor for liquidated damages or a longer statute of limitations. 

This is one of the reasons why DOL opinion letters come in ebbs and flows. When there is a conservative president in the White House, DOL tends to publish more opinion letters with employer friendly advice. However, when there is a liberal president in the White House, they tend to cease publishing opinion letters shortly after the inauguration, with the idea that any advice they give could be misused by employers to avoid liability for violations. This pattern was sustained this year when President Biden took over the White House. President Trump’s DOL was lackadaisical but nonetheless issued opinion letters throughout his term through into early January 2021. But when President Biden was inaugurated, the only action taken by the Biden Administration was to revoke previously published opinion letters In January, February, and as recently as December 28, 2021. This harkens back to the Obama Administration which also ceased issuing opinion letters.  

The reason why left leaning administrations stop publishing opinion letters is that it only serves to limit their ability to pursue violations and ask for liquidated damages and a three-year statute of limitations under the Portal-to-Portal Act. The liberal administrations face pressure from union lobbyists because the unions think the letters get misused by employers.  They also see it as an improper exercise of DOL’s power to issue rules and regulations, since the opinion letters are issued without adherence to any formal rule making procedures and thus have no notice and comment process. The decision to stop issuing opinion letters allows DOL to keep its options open, which is consistent with their purpose of protecting worker’s rights. But, on the other hand, it deprives employers of helpful administrative guidance that is published in an accessible forum. This guidance not only helps the employer in avoiding nasty pitfalls but also inherently helps the employee by providing legal clarity. While it may be used as a defense to a worker’s claim, it can also be used to prevent the same worker from being shortchanged in the first place. 

As a labor attorney, these DOL opinion letters are not solely useful for excusing clients’ actions; instead, they are more often used to help give advice and guidance before a mistake is made. It is easy to point to a letter and say “this isn’t black letter law but it is indicative of how we think DOL is going to look at the situation.” For that reason, I hope that Biden Administration reconsiders its current practice. I understand their motivations, but I fear that it causes more harm than good for covered employees. Part of good leadership is getting the word out. DOL opinion letters are one tool for good leadership at DOL. Keeping the tool stashed in the toolshed ill-serves the workers and employers who are the DOL’s stakeholders.