President Donald Trump's ability to reshape federal agencies that were meant to be independent from the White House will be tested on Friday as a U.S. appeals court considers whether he can remove Democrat members from two federal labor boards.
A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit will hear the Trump administration's appeal of separate rulings by two judges that reinstated Cathy Harris to the Merit Systems Protection Board and Gwynne Wilcox to the National Labor Relations Board (NLRB).
The appeals court's decision could set important precedent on the president's powers to fire officials at a range of multi-member agencies such as the Federal Reserve and may tee up review by the U.S. Supreme Court, which temporarily paused the lower court rulings last month.
The NLRB hears private-sector labor disputes and the merit board decides appeals by federal employees who have been disciplined or fired. Because the merit board is often the only legal recourse for federal workers, it could have a key role in reviewing Trump's efforts to purge the federal workforce.
Members of both agencies are appointed by the president, but federal laws allow them to be removed only for cause including inefficiency, neglect of duty or malfeasance.
Trump removed Harris and Wilcox in January, the first time a president had dismissed a member of either agency. He also removed several other officials who typically remain through administrations, including board members and inspectors general who oversee agencies for waste and corruption.
The Trump administration has argued that laws shielding the officials from removal encroach on the broad powers that the U.S. Constitution grants to the president to control the executive branch.
The removal of Harris and Wilcox has stalled both labor boards, which already had vacant seats, leaving them without enough members to decide cases. Hundreds are pending at the NLRB, and over 9,300 appeals have been filed with the merit board since Trump took office.
The officials' lawsuits have emerged as an early test of Trump's broader efforts to rein in the various federal agencies that were designed by Congress to operate independently. Supporters of those laws say they are necessary to curb political influence over agencies' decision making.
The issue is being watched closely by legal experts, some of whom say that striking down removal protections would give Trump more direct control over regulation of various areas including trade, energy, antitrust enforcement, finance, and consumer product safety.
A ruling in Trump's favor could also encourage him to fire Federal Reserve Chair Jerome Powell if they disagree on monetary policy.
The White House and lawyers for Wilcox and Harris did not respond to requests for comment.
Friday's arguments are likely to focus on the significance of a 1935 Supreme Court ruling known as Humphrey's Executor, which upheld removal protections for members of the Federal Trade Commission after then-President Franklin D. Roosevelt tried to fire one.
Harris and Wilcox say the ruling applies to their cases because the labor boards have a similar structure to the FTC.
Many conservative judges and lawyers have in recent years called the scope of Humphrey's Executor into question. That includes D.C. Circuit Judges Gregory Katsas and Justin Walker, Trump appointees who are on Friday's panel. Both judges in separate recent opinions said Humphrey's Executor merely created a narrow exception to the president's broad removal powers.
The D.C. Circuit panel also includes Circuit Judge Florence Pan, an appointee of Democratic former President Joe Biden.
If the Supreme Court ultimately takes up Friday's cases, it could use them to further narrow Humphrey's Executor or overrule it altogether, legal experts said.
The Trump administration has argued that unlike the trade commission, the NLRB and the merit board wield substantial executive power that places them outside of the exception created by the Supreme Court.
Removal restrictions have historically not had a significant effect on agencies' behavior because Republican and Democrat administrations have respected norms against removing officials from other parties, according to Tyler Lindley, a professor at Brigham Young University Law School.
"That bipartisan agreement and those norms are breaking down, meaning that statutory removal restrictions might be the only obstacle to preventing the president from removing agency leaders who do not support his agenda," said Lindley, who co-authored a forthcoming law review study on the issue.
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