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D.C. District Court backs off a little on EEOC wellness rulemaking order

By Pamela Wolf, J.D.

The Washington, D.C., federal district court that ordered the EEOC to file, by August 13, 2018, any new rulemaking that would incorporate the court’s opinion invalidating the agency’s wellness regulations under the ADA and GINA has backed off that deadline directive following the EEOC’s January 16, 2018, unopposed motion asking the court to do so. However, the court was unpersuaded by the EEOC’s argument that it should not retain jurisdiction of the case, AARP v. EEOC, following vacatur of the regulations and remand to the agency.

Wellness rules unlawful. In August 2017, the court granted AARP’s motion for summary judgment on its Administrative Procedure Act challenge to the regulations, concluding that the regulations are arbitrary and capricious. The EEOC had failed to adequately explain its decision to construe the term “voluntary” in the ADA and GINA to permit a 30 percent incentive level, the court said. The court initially remanded the rules to the EEOC without vacatur, but on reconsideration at AARP’s urging, on December 20, amended its decision to make the remand with vactur. The court, however, delayed the effective date of the vacatur until January 1, 2019, ostensibly giving the EEOC time to promulgate new rules.

Rulemaking deadline. In an order accompanying the December opinion, the court required that “if EEOC proceeds with any notice of proposed rulemaking consistent with the opinions issued on August 22, 2017 … it shall issue such notice by not later than August 31, 2018.” The order also required the EEOC to file a status report by March 30, 2018, on the schedule for the EEOC’s review of the rules, including any further administrative proceedings.

EEOC seeks reconsideration. The EEOC sought reconsideration of the December 20 order arguing that it was inappropriate, except in the most unusual circumstances not present in this case, for a reviewing court to retain jurisdiction pending remand to an agency. The agency asserted that the court should not require it “to issue a notice of proposed rulemaking by a particular date or otherwise limit its future policy discretion.” Among other things, the EEOC asserted that “whether to issue regulations providing that certain levels of incentives for participation in wellness programs comport with the ADA and GINA is left to the EEOC’s policy judgment.”

Amended order. Persuaded only in part by the EEOC’s assertions, the district on January 18 amended its December 20 order by vacating it to the extent it requires the EEOC “to issue any notice of proposed rulemaking on a set schedule or file such notice with the Court. Consistent with its earlier order, the vacatur of the agency’s wellness regulations remains stayed until January 1, 2019.”

The court, however, denied the EEOC’s request that it clarify that that the court is not retaining jurisdiction of the case. The court will retain jurisdiction of the case until January 1, 2019, and the case will be deemed closed as of the following day.

The court also stuck with its original directive that the EEOC file a status report by not later than March 30, 2018.

The case is No. 1:16-cv-02113 (JDB).