The Office of Administrative Hearings (OAH) is an independent quasi-judicial agency that was established to provide a source of independent Administrative Law Judges (ALJ) to preside in administrative law contested cases. It was created to ensure that the functions of rulemaking, investigation, advocacy and adjudication are not combined in the administrative process. As a consequence of this policy, North Carolina operates under what is referred to as the "central panel" system of administrative adjudication. This simply means that the ten Administrative Law Judges, who are employed by OAH, work for the central panel rather than the state agency. North Carolina became the thirteenth jurisdiction to adopt a central panel system (1985).

Besides administrative hearings, there are two other major functions of OAH. The first deals with the procedure which governs rulemaking in North Carolina. Article 2A of the Administrative Procedure Act (Chapter 150B) provides for a uniform procedure for the adoption of rules, both permanent and temporary, and authorizes OAH to publish the North Carolina Register (Register) and the North Carolina Administrative Code (Code). Except for minor exemptions found in G.S. 150B-1(d), all State agencies are required to follow this uniform procedure for conducting public rulemaking hearings, for adopting proposed rules and for filing the adopted rules for codification. The public is notified of agency rulemaking hearings through a notice published in the North Carolina Register. This notice provides a means for interested parties to be present and debate the merits of a proposed rule before adoption by the agency. After the formal adoption, review by the Rules Review Commission and Joint Legislative Administrative Procedure Oversight Committee (unless a bill is enacted by the General Assembly specifically disapproving a proposed rule), the rule is then filed for codification in the North Carolina Administrative Code. All of the rules adopted by State agencies are published in the Administrative Code. Both the Register and the Code are available to subscribers.

The other major function of OAH is found under the provisions of Chapter 7A of the North Carolina General Statutes where in the Office of Administrative Hearings is designated as a 706 deferral agency of the Equal Employment Opportunity Commission. Pursuant to Chapter 7A, the Civil Rights Division of OAH is charged with the investigation of alleged acts of unlawful employment practice for all charges filed by State and local government employees covered under the State Personnel Act, Chapter 126 of the General Statutes. The Director of this Division is also assigned the duty to confer, conciliate or resolve the civil rights charges filed with OAH. In the event that these informal procedures do not produce a settlement for meritorious charges, OAH's Administrative Law Judges are empowered to grant full relief through a contested case hearing process.