Federal Mine Safety Review Commission Authority Over Settlements Affirmed As Labor Department Drops Challenge


By: Nicholas W. Scala

The panel that reviews mine safety and health cases has prevailed in recent federal court filings on the issue of whether it has the legal authority to approve settlements of penalties that MSHA reaches with mining employers. This is a landmark development, one that will allow the Federal Mine Safety and Health Review Commission (the Commission) to exert a greater degree of influence over settlements, which the Labor Department and MSHA had argued are outside the panel’s purview.

In a legal action taken last fall, the Secretary of Labor and MSHA jointly challenged a Review Commission decision in which the panel affirmed an interpretation of The Mine Act that effectively gave it authority to review penalties issued through settlements. That challenge took the form of an appeal of the earlier Commission ruling.American Coal Snip

On March 28, the U.S. Court of Appeals for the D.C. Circuit, where the challenge would have been adjudicated, approved a consent motion by the Secretary and MSHA for voluntary dismissal of the petition. This means the department and agency are no longer pressing the issue in court.

As a result the Commission has the power to review any contested penalties, even those arising from settlement, which means MSHA agreements to reduce employer fines are subject to review.

Panel Asserts Wide Authority
Commissioners staked out their legal position that Congress gave them settlement approval powers through a ruling in Secretary of Labor v. American Coal Co. in which MSHA’s agreement to a 30 percent reduction in fines went before the panel. MSHA had initially issued 32 citations (14 of them serious) and proposed $44,000 in penalties to American Coal after an inspection of an Illinois mine.

An administrative law judge (ALJ) for the Commission had earlier rejected a settlement involving the penalty reduction between MSHA and the coal company, saying there was no factual support for the reduction. The Commission granted interlocutory review of the ALJ ruling.

Commissioners concluded in this review that the Secretary was seeking through the appeal to “change the course of more than 35 years of administrative practice and case law.”

The Commission noted that the Secretary was using American Coal as a “test case” to advance his position that the panel’s authority to review settlements of contested penalties under Section 110(k) of the Mine Act is “much more limited” than that described in  a 2012 decision, Black Beauty Coal Co.

Commissioners affirmed  the ALJ’s denial of the motion to approve the settlement. That decision, followed by the voluntary dismissal of the Secretary’s appeal, sends the case back to the ALJ. At that point MSHA will have to provide more information to the judge supporting the penalty reduction. This was considered a win for the United Mine Workers, which intervened on behalf of the Commission’s side in the case. The union sees this decision as a way to force MSHA’s hand in proving a factual basis for reducing penalties to employers.

MSHA had earlier provided the following basis for the penalty reduction:

“ … the Secretary has determined that a reduced penalty is appropriate in light of the parties’ interest in settling this matter amicably without further litigation. In recognition of the nature of the citations at issue, and the uncertainties of litigation, the parties wish to settle the matter with a 30% reduction in the total assessed penalty with no changes in gravity or negligence for any of the citations at issue.”

The ALJ denied the settlement motion based upon his reading of section 110(k), its legislative history and the Black Beauty decision, reasoning that the motion failed to provide adequate factual support for the reductions, and states that the across-the-board reduction was a “red flag.”

But the Secretary argued in the review process that enforcement agencies generally have unreviewable discretion to settle enforcement actions, citing case law in Heckler v. Chaney (1985).

Commissioners concluded the ALJ was right in his interpretation, cited the legislative history of the Act, particularly Senate report language, and stated in part:

“The Commission cannot accurately be compared to a generalist court or any other judicial or administrative entity owing deference to the unreviewable settlement decisions of an executive agency. Section 113(a) of the Mine Act requires Commissioners to have certain qualifications to carry out the Commission’s functions under the Act.”

The ruling states that with respect to settlements of contested penalties, section 110(k) “explicitly grants” approval authority to the Commission.


The decision by the Department of Labor and MSHA to drop their challenge of the Commission ruling spells the potential for obstacles to new settlements between the Agency and employers.

This puts up a new legal roadblock to some agreements, particularly those that involved across-the-board penalty reductions, and means MSHA will have to find strong factual justification to support future settlements. In turn this could make MSHA actions more burdensome on mining sector employers, who should bear in mind the impact of this decision when engaging in global settlement negotiations with MSHA going forward.


2 thoughts on “Federal Mine Safety Review Commission Authority Over Settlements Affirmed As Labor Department Drops Challenge

  1. I think is very important for the Review Commission get more say on the settlement and force MSHA and the SOL to be reasonable. Our Company just went to a hearing with the MSHA and we saw how the Commission could have done more to help the miners get the story across on why the Citations should have been vacated.

  2. […] On May 9, commissioners at the Federal Mine Safety and Health Review Commission (FMSHRC) once again heard the case Secretary of Labor (MSHA) vs. American Coal Co., in which the Secretary of Labor has fought an administrative law judge (ALJ) at the Commission for years over a planned settlement with the coal operator. This is a key issue for mining operators who want to reach settlements rather than trying to challenge alleged violations before the FMSHRC, and this is the second time the case made its way before the Commission. (See our previous post regarding the litigation history of MSHA v. American Coal Co.) […]

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