Supreme Court has determined that states have no authority to
regulate conduct by the tribes unless specifically authorized
has specifically exempted tribes from several familiar employment
tribal court has primary jurisdiction over claims arising from
commercial transactions with the tribe, including employment.
recent growth of American-Indian casinos and tribal economic development
in Michigan has generated many employment opportunities for American Indians
and non-American Indians alike. The often misunderstood concepts of tribal
sovereignty and jurisdiction have left many experienced labor and employment
law practitioners wondering how state and federal laws apply to tribal
these scenarios would be elementary if the employer was other than a tribe,
consider the following:
• A woman tells
you that she has been sexually harassed by her supervisor at a Michigan
tribal casino. You should advise her to bring her claim to: A. MDCR;
B. EEOC; C. Federal Court; D. None of the above.
A man employed by a tribal casino complains that he was discharged for
his attempts to organize a union. You should advise him to: A. File a
claim with the NLRB; B. File with MERC; C. File a lawsuit in federal court;
D. None of the above.
• Both Mary
and Sally work for a Michigan tribe. Mary is employed by the casino
and Sally works for tribal operations. Both are injured in separate
work-related incidents. You should advise: A. Both employees to file
claims with the Michigan Workers’ Compensation Bureau; B. Both
employees to file claims in federal court; C. Both employees to seek
internal tribal remedies; D. Advise Mary to file a state workers’
compensation claim and recommend to Sally that she pursue internal tribal
If you answered ‘‘D.
None of the above,’’ to the first two questions, you are well
on your way to understanding the impact of Indian tribal sovereignty and
jurisdiction on labor and employment law. If you answered ‘‘D’’
to the third question, you are probably an expert already.
discussion of jurisdiction over American Indian tribes inevitably begins
with the tribal sovereignty. Historically, the Supreme Court considered
the tribes to be distinct nations occupying distinct territory over which
the laws of the states have no force.1
Although today the recognition of sovereignty is more limited, it is well
recognized that American Indian tribes are ‘‘unique aggregations
possessing attributes of sovereignty over both their members and their
Labor and Employment Laws Do Not Apply to American Indian Tribes
The Commerce Clause
of the United States Constitution grants Congress the exclusive power
to ‘‘regulate commerce’’ with American Indian
tribes. Accordingly, the Supreme Court has determined that states have
no authority to regulate conduct by the tribes unless specifically authorized
In Michigan, there
are two notable exceptions: the Michigan Employment Security Act, MCL
421.1, and the Workers’ Compensation Act, MCL 418.101. As part
of the negotiation of the gaming compacts between the state and the
tribes, the parties agreed that the state will have jurisdiction over
tribal casino employees under the limited scope of these two statutes.
The compacts can be found at http://www.michigan.gov/mgcb/0,1607,7-120-1380_1414_2182---,00.html.
For non-casino tribal employees, these laws do not apply unless the
tribe voluntarily submits to the state’s jurisdiction.
state courts do not have jurisdiction over statutory and common law employment
claims that arise on a reservation or trust land, including casinos.4
Further, before federal courts will exercise jurisdiction over state law,
internal tribal remedies must be exhausted.5
statutory and common law claims fall into several groups: those specifically
exempting or including American Indian tribes and those covering or excluding
American Indian tribes by implication.
has specifically exempted tribes from several familiar employment laws,
• Title VII
of the Civil Rights Act of 1964, 42 USC 2000e(1)
• Title I of
the Americans with Disabilities Act, 42 USC 12111(b)
The Workers Adjustment and Retraining and Notification Act, 20 CFR 639.3(a)(1)
the other hand, Congress can make a statute applicable to tribes through
the exercise of its plenary powers. Congress did so in the 1983 amendments
to the Social Security Act. As a result, tribes are now subject to both
Social Security and federal unemployment taxes.
to federal common law, two issues must be addressed before bringing a
claim. The first is whether the tribe or Congress has clearly waived the
tribe’s sovereign immunity.6
A tribe’s mere act of entering into a commercial transaction does
not necessarily waive its immunity as to claims arising from that transaction.7
Once a waiver of sovereign immunity has been established, jurisdiction
must be determined. Ordinarily, tribal court has primary jurisdiction
over claims arising from commercial transactions with the tribe, including
Accordingly, administrative and judicial remedies must typically
be exhausted before resorting to federal court.9
remaining federal employment laws must be examined on a case-by-case basis,
based on the waiver of sovereign immunity and tribal self-determination.
Under the commerce clause, only a tribe or Congress can waive tribal sovereignty.
At one time, a congressional waiver had to be ‘‘clearly manifest.’’10
Today, this is changing, as seen in the volumes of litigation following
Federal Power Commission v Tuscarora Indian Nation.11
The Tuscarora case established a two-part test for implied
waiver: (1) Is the statute one of general application, intended by Congress
to apply to all citizens; and (2) can the statute be applied to American
Indian tribes without undermining treaty rights or unduly interfering
with internal governance?
Tribes Not Covered
the Tuscarora test, the National Labor Relations Act (NLRA) does
not apply to employment by tribes. The National Labor Relations Board
(NLRB) has consistently held that tribes are units of government and,
as such, are exempt from the NLRA’s definition of employer.12
In recent years, the board has come to distinguish employment by entities
not directly controlled by tribal councils. For example, the board would
exert jurisdiction over a tribe’s joint venture with non-American-Indian
Similarly, the board has found the NLRA applicable to organizations created
by tribes but controlled by semi-autonomous boards.14
A helpful discussion of the NLRB decisions is found in Yukon-Kuskokwin
Health Corp v NLRB.15
The application of tribal ‘‘right to work’’ laws
to non-American-Indian enterprises operating on a reservation remains
unsettled. In NLRB v Navajo Nation,16
the NLRB was found to have jurisdiction over a business operating on land
leased from a tribe and shipping uranium ore in interstate commerce. Yet,
a tribe’s ‘‘right to work’’ law was found
to deprive the NLRB of jurisdiction over contractors doing work for a
tribe on reservation land.17
by Implication and/or Consent
tend to follow the notice requirements of COBRA and ERISA voluntarily.
In any event, at least one court has found coverage to be mandatory.18
of Tribes in Doubt
application of several other familiar laws remains uncertain due to disagreement
among the courts of appeal.
application of the Age Discrimination in Employment Act is unclear. The
Act was found to apply to the tribes in EEOC v Karuk Tribe Housing
However, tribes were exempted in EEOC v Fond du Lac Heavy Equipment
and in EEOC v Cherokee Nation.21
of the Occupational Safety and Health Act (OSHA) is similarly in doubt.
OSHA was found to apply to the tribes in USDOL v OSHA,22
and Reich v Mashantucket Sand & Gravel.23
However in Donovan v Navajo Nation,24
the court held that OSHA does not apply.
cases discuss application of the Fair Labor Standards Act (FLSA) to the
tribes. The Seventh Circuit has refused to apply the overtime provisions
to the FLSA to wardens employed by an inter-tribal commission charged
with enforcing tribal hunting and fishing regulations on treaty land.
The court declined to decide whether tribes are generally subject to the
FLSA. Rather, the court found that, even if the commission were subject
to the FLSA, the employees in question were subject to the same overtime
pay exemptions applicable to law enforcement officers employed by the
the Family and Medical Leave Act incorporates the FLSA definition of employer,
application of that Act remains similarly in doubt. It is not uncommon
for tribes to offer a similar benefit to their employees.
may want to become comfortable with internal tribal remedies. Michigan
tribes have adopted comprehensive personnel policies and procedures. Many
include internal dispute resolution mechanisms. Often, at least in the
first instance, the internal dispute procedures for employees will be
administrative rather than judicial. In any event, to the extent the tribe
has waived its sovereign immunity in employment matters, there may also
be a claim in tribal court based on tribal policy, tribal law, or tribal
Further, it may
be advisable to address the issue of tribal sovereignty and jurisdiction
in negotiating an employment contract with a tribe.
We hope that with
the foregoing concise summary in hand, labor and employment law practitioners
will be better equipped to analyze and respond to the unique jurisdictional
issues posed by the existence of sovereign American Indian nations within
the state of Michigan.
Worcester v Georgia, 31 US (6 Pet) 515, 559 (1832).
United States v Wheeler, 435 US 313, 323 (1978).
3. California v Cabazon Band
of Mission Indians, 480 US 202, 204–207 (1987).
Williams v Lee, 358 US 217, 220 (1959).
5. Iowa Mutual Ins Co v La
Plante, 480 US 9 (1987).
C & L Enterprises v Potawatomi Indian Tribe of Oklahoma,
532 US 411 (2002).
Kiowa Tribe of Oklahoma v Manuf Technologies, Inc, 523 US 751
Montana v US, 445 US 960 (1980).
National Farmers Union Ins Co v Crow Tribe, 471 US 845 (1985).
Elk v Wilkins, 112 US 94 (1994).
Fort Apache Timber Co, 226 NLRB 63 (1976).
13. Sac & Fox Industries,
Ltd, 307 NLRB 241 (1991).
NLRB v Chapa De Indian Health Program, Inc, 316 F3d 995 (CA
15. 234 F3d 714 (US App DC,
288 F2d 162 (US App DC, 1961).
17. NLRB v Pueblo of San
Juan, 276 F3d 1186 (CA 10, 2002).
See Colville Confederated Tribes v Somday, 96 F Supp 2d 1120
(ED WA, 2000).
19. 260 F3d 1071 (CA 9, 2001).
986 F2d 246 (CA 8, 1993).
21. 871 F2d 937 (CA 10, 1989).
935 F2d 182 (CA 9, 1991).
23. 95 F3d 174 (CA 2, 1996).
692 F2d 709 (CA 10, 1982).
Reich v Great Lakes Fish and Wildlife Comm’n, 4 F3d 490
Authors’ Note: Special thanks to Kathryn Tierney, attorney, Bay
Mills Indian Community, for her assistance with this article. For additional
information, contact the authors at email@example.com
On May 28, 2004,
after the type had been set for this article, the National Labor Relations
Board reversed its decision in Fort Apache Timber and held
that the NLRA is generally applicable to American Indian tribes and
enterprises. In two companion cases, San Manuel Indian Bingo and
Casino (No. 31-CA-23673 & No. 31-CA-23803) and Yukon Kuskwokwim
Health Corp, on remand (No. 19-CA-2663) rejected as fatally flawed
the fundamental premise of Fort Apache and the NLRB’s
other decisions involving American Indian tribes over the past 28 years.
It is now the position of the board that American Indian tribes and
enterprises are not units of government as that term is used in the
NLRA, requiring application of the Tuscorara test. Applying
Tuscorara, the board first found the NLRA to be a statute of
general application. Accordingly, the board held that it has jurisdiction
over American Indian tribes and their enterprises unless asserting jurisdiction
• touch exclusive
rights of self government in purely intramural matters; or
treaty rights; or
• be contrary
to the intent of Congress to exempt American Indian tribes.
board added a new element to the Tuscorara test. When the board
determines that it has jurisdiction under Tuscorara, it will
examine established federal policy to determine whether it should abstain.
It is this discretionary element that led the board to reach opposite
results in the two cases decided on May 28.
In San Manuel,
the board exerted jurisdiction over the tribal casino and ordered a
representation election. First, the board found that the operation of
a tribal casino was a commercial enterprise and, as such, did not involve
purely intramural matters. In a significant departure from its prior
cases, the board would interpret ‘‘purely intramural matters’’
very narrowly. The board would exempt from its jurisdiction only matters
related to tribal membership, inheritance rules, and domestic relations.
Next, the board found no impact on treaty rights, in that the record
made no reference to any treaties involving the San Manuel Tribe. Further,
the board noted that Congress expressed no intent to exempt American
Indian tribes from the broad application of the NLRA. Finally, the board
held that federal policy favored jurisdiction in this case, because
the casino is a commercial enterprise in and affecting inter-state commerce,
employing non-American Indians and catering to non-American-Indian customers.
Yukon Kuskwokwim Health Corp, on remand, the board reversed
its 1999 decision in this matter and declined to assert jurisdiction over
a health care consortium created by several tribes. The board found that,
despite the reservations expressed by the Court of Appeals for the D.C.
Circuit, it has jurisdiction over the enterprise. However, the board declined
to exercise that jurisdiction for reasons of federal policy. The board
recognized that the respondent was created under the Indian Health Care
Improvement Act and fulfills the federal government’s trust responsibility
to provide free health care to American Indians. Furthermore, the respondent
is the primary health care provider in its area, it serves almost exclusively
Alaskan Native patients, and it does not compete with non-American-Indian
health care providers.
Deron Marquez, chairman
of the San Manuel Band, told the press that the tribe is planning an
appeal. Several tribes, and the National Indian Gaming Association,
had filed amicus briefs with the labor board. The dispute may be ultimately
decided by the U.S. Supreme Court.