Under the Fair Labor Standards Act, governments may compensate employees
for overtime work with compensatory time off, if there is an agreement
between the employee and the government that compensatory time off
is a way to compensate for overtime work. The FLSA and its implementing
regulations require that when these agreements are in place the
government employer must honor an employee request for compensatory
time off within a reasonable period, so long as it will not unduly
disrupt the employers operations. The FLSA and its regulations
set a cap on the number of compensatory time off hours an employee
may accrue, and they allow the government employer to cash out (that
is, pay off) accrued compensatory time off, rather than allow the
employee to take all the accrued time off. In Christensen v.
Harris County, the issue was whether a government employer could,
consistent with this statutory and regulatory scheme, require an
employee to take accrued compensatory time when the employee did
not want to, rather than cash out the employee or wait until the
employee requested time off.
The statute and regulations were silent on the matter, and the
Court was unanimous that the statute was ambiguous on the subject.
The Acting Administrator of the Wage and Hour Division of the U.S.
Department of Labor, however, had opined in a formal opinion letter
that a government employer could require its employees to take compensatory
time off only if the underlying agreement relating to taking
compensatory time in lieu of wages so provided. This raised the
question whether the Chevron doctrine should apply, requiring
deference to the agencys reasonable interpretation. In an
opinion for the Court by Judge Thomas, five of the justices agreed
that it should not.
The Court without any particular elaboration simply stated that
this interpretation was "contained in an opinion letter, not
one arrived at after, for example, a formal adjudication or notice-and-comment
rulemaking. Interpretations such as these in opinion letters
like interpretations contained in policy statements, agency manuals,
and enforcement guidelines, all of which lack the force of law
do not warrant Chevron-style deference." These statements
were followed with citations to three cases and Davis & Pierces
treatise. Rather, the Court said, the interpretation was subject
only to Skidmore deference, see Skidmore v. Swift &
Co. 323 U.S. 134 (1944) (a case also involving an opinion letter
of the Wage and Hour Administrator). That deference, often referred
to as "weak deference" in contrast to the "strong
deference" under Chevron, only affords "respect"
to the agency interpretation, and then only to the extent that the
interpretation, in light of the agencys experience and expertise,
has "the power to persuade." In Christensen, the
Court found the opinion letter unpersuasive, and it believed "the
better reading" of the statute was to allow an employer to
require employees to take compensatory time at a particular time,
without any need to include it in the underlying agreement regarding
The Court then went on to address whether the opinion letter was
entitled to the particular deference afforded to an agencys
interpretations of its own regulations, citing Auer v. Robbins,
519 U.S. 452 (1997), and Bowles v. Seminole Rock & Sand
Co., 325 U.S. 410 (1945). It found that the regulation itself
was not ambiguous; it was "plainly permissive." Accordingly,
"to defer to the agencys position would be to permit
the agency, under the guise of interpreting a regulation, to create
de facto a new regulation."
Justice Scalia took issue with the Courts avoidance of Chevron
and its reliance on Skidmore, although even applying Chevron,
he concluded the agencys interpretation was unreasonable.
He maintained that Skidmore is an anachronism, "dating
from an era [that is, pre-Chevron] in which we declined to
give agency interpretations (including interpretive regulations,
as opposed to legislative rules) authoritative effect."
In other words, before Chevron, courts did not recognize
an agencys interpretation of a statute to be authoritative
even when it was contained within a rule that had gone through notice
and comment. Rather, courts had insisted that John Marshalls
statement in Marbury v. Madison, that it is "the province
and duty of the judicial department to say what the law is,"
meant that courts had to exercise independent judgement as to the
meaning of statutes. Chevron clearly changes this understanding.
Moreover, Justice Scalia noted that in a number of cases the Court
had invoked Chevron and applied its deference to interpretations
not contained in agency regulations, including those contained in
(excerpted from Administrative & Regulatory Law News, Section
of Administrative Law & Regulatory Practice, American Bar Association,
Vol. 25, No. 4, Summer 2000)