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Perez v. Mortgage Bankers Association

Articles Discussing Case:

eLABORate: Department of Labor's Changed Stance on the Applicability of the FLSA's Administrative Exemption to Mortgage Loan Officers Upheld by Supreme Court

Phelps Dunbar LLP • March 13, 2015
On March 9, 2015, the United States Supreme Court (“Court”) issued its ruling in Perez v. Mortgage Bankers Association, upholding a Department of Labor interpretation regarding the status of mortgage loan officers as non-exempt under the Fair Labor Standards Act (“FLSA”), even though the DOL’s position was a 180-degree reversal from what it had said a few years prior. At issue in Perez was whether the Department of Labor could alter its position regarding whether mortgage loan officers qualify for the administrative exemption under the FLSA without adhering to the notice-and-comment rulemaking process set forth in the Administrative Procedure Act (“APA”). To fully understand the Court’s ruling, a brief background on both the APA and the applicability of the FLSA’s administrative exemption to mortgage loan officers is necessary.

Supreme Court Rejects Notice and Comment Rulemaking Requirement for Agency Interpretations

Franczek Radelet P.C • March 12, 2015
In a case we labeled one of the “cases to watch” this term, a relatively unified Supreme Court decided in Perez v. Mortgage Bankers Association that a federal agency does not need to engage in notice-and-comment rulemaking pursuant to the Administrative Procedure Act (APA) before it can significantly alter an interpretive rule of an agency regulation, even if parties have relied on that rule to their detriment.

Supreme Court Paralyzes Paralyzed Veterans Doctrine, Affords Greater Deference To Federal Agencies

Fisher Phillips • March 10, 2015
Today, in a 9-0 decision, the U.S. Supreme Court abolished a precedent on which the regulated community has relied to keep federal agencies in check for nearly 20 years. This precedent, commonly referred to as the Paralyzed Veterans doctrine, required a federal agency to engage in notice-and-comment rulemaking before revising its definitive interpretation of a regulation. In its departure from the Paralyzed Veterans doctrine, the Supreme Court paved the way for even greater deference to federal agencies. According to the Court, the Paralyzed Veterans doctrine is contrary to the clear text of the Administrative Procedures Act’s rulemaking provisions and improperly imposes on agencies an obligation beyond the Administrative Procedures Act’s maximum procedural requirements. Perez v. Mortgage Bankers Association consolidated with Nickols v. Mortgage Bankers Association.

Supreme Court Eliminates Notice-and-Comments for Some Agency Interpretations

Ogletree Deakins • March 10, 2015
On March 9, 2015, the Supreme Court of the United States ruled that the Paralyzed Veterans doctrine, which requires an agency to use the notice-and-comment procedures of the Administrative Procedure Act (APA) when issuing a new interpretation of a regulation that deviates significantly from a previously adopted interpretation, is not consistent with the APA. According to the court, the doctrine—which benefited employers by assuring them that a federal agency interpretation of a regulation could not be changed without a significant undertaking—is contrary to the clear text of the APA’s rulemaking provisions and improperly imposes on agencies an obligation beyond the APA’s maximum procedural requirements.