The Supreme Court last month struck down the Chevron doctrine, with far-reaching implications for consumer protections — as well as customer experience leaders.
The 40-year-old doctrine gave deference to federal agencies where Congress was ambiguous. The idea: that subject experts were better equipped than judges to interpret legislation and set policy, so long as the position appeared reasonable.
Consumer rights groups worry that the decision threatens federal regulations designed to protect consumers. CX leaders in all industries will have to constantly adapt, as federal rules may be overturned.
“We're concerned that it could undermine rules that the public interest expects will protect them,” Rachel Weintraub, executive director at Coalition for Sensible Safeguards, told CX Dive. “We're concerned that without deferring to the experts who are deeply knowledgeable on these issues ... that the protections that we expect and rely upon could be at risk.”
What the ruling entails
With the Chevron decision overturned, courts gained more leeway to shape policy.
“Chevron has proved to be fundamentally misguided,” Chief Justice John Roberts wrote for the majority in a 6-3 decision in Loper Bright Enterprises v. Raimondo. He was joined by the court’s five other conservative judges who believed the doctrine gave too much power to unelected government officials.
Now, when a business brings a case before a judge, each judge can use their own criteria and process to determine the meaning of ambiguous legislation.
“Instead of having a clear process to defer to agency expertise when a statute is ambiguous, the court could then use their own judgment,” Weintraub said. “They could rely on facts provided by the entity objecting to the rule, while not looking at the agency experts for their determination.”
The decision, along with another decision last week that extends the time frame to challenge regulations, changes the calculus for businesses deciding whether to challenge federal rules, experts said.
Businesses that find certain policies onerous can try to take cases to different states, believing there are more sympathetic judges in one jurisdiction over another and that they will have a better chance at overturning a rule.
“This means the courts are going to be flooded with cases that are going to try and challenge just about anything and everything that folks in the business world don't particularly like,” Judy Weader, principal analyst at Forrester, said.
A judge in one state could choose to overturn a regulation, while another might choose to defer agency expertise and keep it in place. The result could be a patchwork of federal regulations.
“You're going to find that it's increasingly harder for businesses to understand the footing that they have to be able to do things,” Weader said. “I think you're going to have very few businesses that are going to be really excited about it, unless they're planning on suing to make something go away.”
Consumer confusion could muddle CX metrics
Customers in every industry, from financial services to transportation, will be affected by this ruling, experts said.
“Customers won't really understand the full effect of it until it hits their pocketbook or their wallet,” Weader said. “And when it does, it's going to be a very, very nasty surprise.”
The Department of Transportation, for example, recently announced rules that forced airlines to offer passengers automatic cash refunds when the carriers cancel or significantly change their flights.
If such a rule is challenged and overturned, customers who believe they will be refunded will be hit with a rude surprise, Weader said. That frustration spells trouble for customer experience metrics.
“If customers are already unhappy, what does all of this potential confusion mean?” Weader said. “It could cause havoc on CX scores.”
But some industry leaders — particularly the heavily regulated areas like banking — say that consumers will benefit.
“This is an important win for accountability and predictability at a time when agencies are unleashing a tsunami of regulation — in many cases clearly exceeding their statutory authority while making it harder for banks to serve their customers,” American Bankers Association President Rob Nichols said in a prepared statement.
Despite the increased risk that regulations could be overturned, federal agencies will continue their work researching and writing policy to protect consumers, Weintraub said.
“Even though this decision is a blow to the administrative process, it does not impact the underlying missions of the agencies,” she said.
Stay educated, and keep communication clear
With the changing business environment, CX leaders will need to stay up to date on the latest changes and adapt accordingly.
Weader urges CX leaders to be crystal clear in their communications to customers about any changes, to express the value of providing a good customer experience to business leaders, and to bring other leadership on board.
CX leaders in heavily regulated industries, like health insurance, financial services or utilities, are going to have to spend a lot more time educating themselves on changing rules, what they mean for customers and how to minimize the disruption they will cause.
“Talk with your compliance folks more frequently, talk with your legal folks often so that you understand: What are the local issues that we need to be aware of? What are the things that are changing?” Weader said.
