The Limits of OSHA’s Reach: 5th Circuit Applies Loper Bright to Invalidate an OSHA Regulation

Two years after the Supreme Court overturned Chevron deference in Loper Bright Enterprises v. Raimondo, the Fifth Circuit has given employers an early example of how the new framework may reshape OSHA enforcement. In Exxon Mobil Corp. v. Occupational Safety and Health Review Commission, decided July 21, 2026, the Fifth Circuit held that Section 8 of the Occupational Safety and Health Act (OSH Act), 29 U.S.C. § 657(c)(2), does not authorize OSHA to require employers to record work-related mental illnesses. As a remedy, the Fifth Circuit set aside the citation and penalty and vacated OSHA’s recordkeeping regulation covering mental illnesses, 29 C.F.R. § 1904.5(b)(2)(ix). More broadly, the Fifth Circuit explained that Congress delegated only limited authority to OSHA via the OSH Act, allowing the agency to create rules governing physical work-related injuries and illnesses under Section 8 of the OSH Act—and not other topics such as mental illness.

The Secretary of Labor has since filed a petition for panel rehearing directed only to the remedy, arguing that Section 11(a) of the OSH Act, 29 U.S.C. § 660(a), authorizes a federal court of appeals reviewing a Commission order to affirm, modify, or set aside that order, but does not authorize the court to vacate the underlying regulation itself. Regardless of how the panel resolves that remedial question, Exxon Mobil is an important lesson in the art of creative challenges to OSHA citations—not just to the validity of the citation as issued, but more broadly to the validity of the underlying regulation itself under Loper Bright.

The Statutory Question

The case arose from OSHA’s injury and illness recordkeeping requirements. OSHA cited Exxon Mobil after the company assessed the issue and decided that it was not required to record three employees’ mental illnesses on its OSHA 300 logs. An Occupational Safety and Health Review Commission (OSHRC) administrative law judge (ALJ) agreed that two of the three employees at issue did not need to be included on the log because they did not satisfy the regulatory criteria. However, the ALJ ruled that the third employee met the criteria for recording the mental illness on the log and affirmed the “Other-than-Serious” citation item with its $691 penalty solely as to that employee. OSHRC did not grant review, so the ALJ’s decision became a final order.

On appeal to the Fifth Circuit, Exxon Mobil did not limit its challenge to whether OSHA had correctly interpreted its own regulation and applied it to the facts at hand. Instead, it challenged the statutory foundation for the cited regulation: whether Section 8 of the OSH Act, 29 U.S.C. § 657(c)(2), authorizes OSHA to require employers to maintain records of work-related mental illnesses in the first place. The Secretary of Labor argued that the statutory reference to “work-related deaths, injuries and illnesses” reaches mental illnesses, citing the statutory text, structure, legislative history, and its own guidance and interpretations.

OSHA’s framing and Exxon’s challenge brought Loper Bright squarely into play. Before Loper Bright, a court confronted with an ambiguous statute deferred to a reasonable agency interpretation (under Chevron). In Loper Bright, the Supreme Court rejected that approach and instructed courts to exercise independent judgment when determining whether an agency has acted within the authority delegated by Congress in a statute. Applying that framework, the Fifth Circuit focused on the way Congress paired “injuries and illnesses” in the statute and on the surrounding language—for example, excluding minor injuries involving only first aid (no medical treatment), loss of consciousness, restriction of work or motion, or job transfer. The Fifth Circuit then concluded that, while both readings were plausible, the “best reading of the statute is narrower,” referring to physical injuries and illnesses only. On that basis, the Fifth Circuit vacated both the lone remaining citation item issued against Exxon and the underlying regulation itself.

Loper Bright Does Not Mean Zero Agency Deference

The decision highlights an important boundary. Loper Bright addresses the judiciary’s approach to evaluating statutory authority behind agency actions—instructing that courts “must exercise their independent judgment in deciding whether an agency has acted within its statutory authority.” But Loper Bright does not overrule so-called Auer deference, which the Supreme Court most recently addressed in its 2019 decision in Kisor v. Wilkie. Under Auer as interpreted in Kisor, courts must exhaust the traditional tools of construction before finding a regulation genuinely ambiguous; after that, courts may defer to an agency’s reasonable interpretation (if additional requirements set forth in Kisor are met). The Auer/Kisor and Loper Bright distinction is significant in OSHA challenges because OSHA has a well-developed body of guidance for its regulations in letters of interpretation and other official enforcement memoranda. This is all the more true for employers who regularly encounter performance-oriented OSHA standards, instead of the clear and bright-line prescriptive standards that leave little room for ambiguity. Unless a court upends the statutory basis for a regulation, employers should continue to consider OSHA’s guidance under this framework.

What Employers Should Watch

The Exxon decision underscores the importance of distinguishing between questions of statutory authority and regulatory interpretation in enforcement actions. Importantly, Exxon also confirms that Loper Bright adds another arrow to the quiver of defense lawyers—and savvy employers may start their review of OSHA citations by questioning longstanding assumptions about the statutory basis for the regulations cited. Employers evaluating OSHA citations should consider both whether they actually met the requirements of the cited standard and whether the standard itself falls within Congress’s delegated authority under the OSH Act.

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