GGB is committed to providing updated news and analysis on our weekly news site,

Sovereign Showdown

Tribes going to war over federal labor law

Native American tribes are prepared to go to war in the upcoming congressional session over the growing intrusion of federal labor law into tribal sovereignty and self-governance.

But tribal attorneys and political consultants on Capitol Hill differ widely when it comes to predicting whether the tribes will be successful in their efforts.

Tribal governments lost their historical exemption from the National Labor Relations Act when the District of Columbia Circuit Court in a landmark 2007 ruling declared the tribal casino owned by the San Manuel Band of Serrano Mission Indians of San Bernardino County, California, was subject to an unfair labor practice ruling by the National Labor Relations Board.

The tribe had argued that the NLRB had no jurisdiction in the matter.

The breach of tribal sovereignty on labor matters widened in April 2009 with Solis v. Matheson, where the 9th Circuit Court of Appeals ruled a reservation cigarette business operated by the Puyallup Tribe of Washington State was subject to the Fair Labor Standards Act. The court said federal compliance agents could enter tribal lands and search records.

No Jurisdiction
Some labor attorneys predict federal labor law intrusion in tribal affairs will increase with the continued growth of the tribal casino industry and expanding economic development on and off tribal reservations, much of it fueled by non-Indian labor. Tribal government casinos are a $26 billion-a-year business with 284,000 workers, according to the National Indian Gaming Association, most of them non-Indian and at least some desiring the protection of federal law and employee unions.

The National Congress of American Indians believes tribes can legislatively recover their lost protection from federal labor laws. NCAI will attempt to get a congressional fix to the San Manuel ruling, restoring the historic tribal exemption to the National Labor Relations Act.

“That issue is still a concern for tribes,” NCAI attorney John Dossett says. “It’s something we’re working on.”

Paul Moorehead, who handles indigenous affairs for the Washington, D.C., law firm Drinker Biddle & Reath, LLP believes pro-business Republican midterm election gains in the U.S. House and Senate bode well for the tribes.

“If the polls are to be believed, there will be a Republican majority in the House and the GOP will pick up seats in the Senate,” Moorehead says. “And if history is any guide, the Republicans, at least some of them, are more receptive to tribal arguments when it comes to forced unionization.”

“They (GOP) are certainly not going to make it easier for unions to organize,” says attorney Greg Guedel in the Seattle office of Foster Pepper PLLC. “That’s one thing the unions have on their legislative agenda. The Republicans are not going to support that at all.”

Rep. John Kline (R-Minnesota), a ranking member of the Health, Employment Labor and Pension Subcommittee of the House Committee on Education and Labor, is tabbed as the man who will pursue a tribal exemption to the NLRA.

“I’m pretty sure he will,” Moorehead says. “I will predict legislation will be reintroduced in January and the committee will hold hearings and try to pass the bill.”

But Guedel is skeptical an NLRA exemption bill making it out of a House committee will get through a Democratic-controlled Senate.

“It’s certainly what the tribes would like to see happen,” Guedel says. “But I would be very surprised if such a bill makes it out of committee because the political environment is very contrary to that right now.”

Labor attorney Steve Wheeless in the Phoenix, Arizona, office of Steptoe & Johnson, LLP says the legislation will not get much support from Congress or President Barrack Obama, who won election with the backing of organized labor.

Obama pushed for passage of the Employee Free Choice Act legislation intended to enable unions to bypass secret ballot elections in organizing workers. What became known as the “card check” bill died a victim of political capital lost on health and finance reform and GOP gains in the House and Senate.

Obama may be pro-labor, Wheeless says, but he is not apt to limit NLRB jurisdiction on tribal matters.

“Congress will not take up this issue anytime soon,” Wheeless says. “The Obama Administration will only broaden NLRB jurisdiction, not narrow it. President Obama is philosophically opposed to limiting NLRB jurisdiction.”

Construction Partnerships
Indian governments have largely worked cooperatively with construction trade unions involved in the building boom surrounding the development of the tribal government casino and resort industry. Assistant Labor Secretary Jane Oates in April visited the Tulalip Tribes of Washington State and praised the Indian nation for its ability to work with construction trades building the tribe’s new resort.

“We hear nightmares about how some tribes are not able to negotiate with labor unions,” Oates says. “The Tulalip Tribes did an amazing job, and we are here to learn from them.”

Oates toured the Tulalip Tribal Employment Rights Office, which was established to guarantee preferential employment for tribal members and contracting rights on the reservation. The office also works to improve wages, and provides training and career and contracting opportunities.

“It’s unacceptable that unemployment in Indian Country is five times what it is among non-Natives,” Oates says.

Tulalip board member Glen Gobin told Oates that myths, stereotypes and misconceptions about the American Indian are dispelled by reservation construction projects.

“We know that our tribal members are our most valuable resource,” Tulalip Chairman Mel Sheldon says.

Union Full-Court Press
Wheeless believes changes in federal law are greasing the skids for unions to organize tribal workers at casinos and other government enterprises.

“I predict dramatic increases in union organizing in Indian Country in the next three years,” he says.

There has been some recent successful union organizing of tribal government casino employees, but for reasons that appear to be totally unrelated to federal labor laws.

The San Manuel Band of Mission Indians and Viejas Band of Kumeyaay Indians of San Diego County are both signatories to collective bargaining agreements with the Communication Workers of America. Both bands embraced CWA representation about six years ago, at a time they were being pressured by the Hotel Employees and Restaurant Employees International Union, which has since merged with textile workers to form UNITE HERE.

The hotel union, which represents Nevada casino workers, has long been a nemesis of California tribes, filing a lawsuit on behalf of the commercial gambling industry in the late 1990s to contest ballot initiatives to enable tribes the right to enter into tribal-state casino compacts.

UNITE HERE has since organized workers at a handful of California tribal government casinos. The union’s success was largely a result of organized labor’s clout with the state legislature. UNITE HERE provided the political influence some tribes needed to either obtain new gambling agreements with newly elected Governor Arnold Schwarzenegger or renegotiated tribal-state compacts allowing them additional slot machines. Some renegotiated compacts have “card check” clauses similar to the proposed EFCA legislation. Most have no-strike clauses.

HERE in the late 1980s and early 1990s used a corporate strategy of political, public relations and economic pressure to force Las Vegas casino companies into welcoming union organizers into Strip resorts.

The United Auto Workers recently organized 2,500 employees at Mashantucket Pequot’s Foxwoods Casino in Ledyard, Connecticut. But the no-strike agreement was drawn up under a tribal labor ordinance rather than federal law.

The union agreement was also moved along by the fact Foxwoods is in default on loans and needed a union agreement to set down a predictable scenario for future labor costs. The agreement with the UAW sets wage and benefit rates for two years, and eliminates the potential for labor unrest or further legal battles with the union or the federal government.

“Working together, we proved casino workers can successfully exercise their right to have a union under tribal law,” UAW Region 9A Director Bob Madore said in a statement. “Our settlement demonstrates what we have known all along: that tribal sovereignty and employee rights need not be inconsistent. We value the investment and jobs the Mashantucket Pequot Tribe has brought to Connecticut, and we look forward to promoting this exciting resort as a destination of choice for working families and union members across New England.”

Guedel calls the Pequot/UAW pact a “breakthrough event.”

“But there has not been a groundswell of new union organizing of tribal casino workers,” he says. “There are some ongoing organization activities. But I haven’t seen Foxwoods followed up by similar successes in other areas of the country.”

Guedel and others suggest that tribes develop labor ordinances and policy under tribal laws to discourage government intrusion into Indian affairs and protect issues of importance to self-governance, such as Indian preference in hiring practices.

“We advise our tribal clients of the critical importance of having solid, well-thought-out and comprehensive labor and employment ordinances, policies and procedures,” Guedel says. “Basically what the federal government is looking for when an agency like the Department of Labor starts poking around in the tribal context is, ‘Do we have a vacuum here? Are the tribes operating businesses as an outside entity would, but doing so without any kind of self-regulation?’ If so, the government feels more confident in stepping in and trying to assert jurisdiction.

“It doesn’t have to mirror federal policy,” Guedel says. “It doesn’t have to be exactly the same. It can be customized to meet their needs. But if you have nothing you’re vulnerable. The more you have and the more detailed it is, the more you’ll be likely to defend yourself based on your tribal sovereignty.”

Legislative Agenda
Moorehead says some tribes are establishing labor law on the reservation while pursuing a legislative fix to the San Manuel decision.

“Some progressive, classically liberal, business-savvy tribes have tried to placate employers with labor protections under tribal law, while at the same time fighting a rear-guard action, trying to prevent the big boys from coming on the reservation telling them how to run their shops,” he says.

The clash between tribes and the federal government was foreshadowed with the growth of the casino industry and growing, diversified economic development on and off tribal reservations. The federal government was not concerned with tribal labor issues when Indian economic development was restricted to smoke shops and indigenous Americans selling beads and blankets at the side of a desolate reservation road.

“That’s something that evolved over the last 10 or 15 years,” Guedel says. “Tribes have moved beyond the traditional smoke shops on the reservation run by three tribal members. Tribes here in the Northwest have casinos, Wal-Mart, Home Depot and all kinds of big-box retailers on and off their land. That evolution has begged the question, ‘Now you’ve got this big operation, what are the rules?’

“This whole area of law is evolving, week by week, because there are so many new scenarios tribes are operating under that they weren’t involved with before. A lot of tribal labor law issues are fact-specific because there are different forms of partnerships between tribal governments and non-Indian businesses. Each time somebody files a lawsuit or grievance it involves a whole new set of questions. There’s a whole lot in this area that is changing and very dynamic. It’s interesting. There are not a lot of hard-and-fast rules at this point.”

Wheeless is not optimistic that tribes will be able to avoid additional federal regulation of their government enterprises, particularly with the growth of the casino and resort industry and as tribal investments move off the reservation and involve businesses that employ non-Indian workers.

“Tribes currently don’t pull enough weight with either party on Capitol Hill to effectuate a sea change in the legal framework for these issues,” Wheeless says. “The bottom line is federal labor law intrusion onto tribal lands is a bitter, bitter pill to swallow, but it is the flip side of the Indian gaming revenue coin.

“The harsh reality is that tribes cannot expect to profit from marketing to and serving a largely non-tribal customer base, often employing many non-tribal employees, and at the same time, invoking tribal sovereignty to avoid federal labor laws. If tribes want to compete and operate in a national or regional non-tribal market, they must expect to play by the same rules as everyone else. That is a tough message, but one that tribal leaders must come to grips with.”

Dave Palermo is a former award-winning newspaper reporter and editor. He currently is a freelance writer and media consultant. He can be reached at [email protected]

Dave Palermo is an award-winning metropolitan newspaper reporter. He has written about American Indian governments for more than 20 years, working as an advocate for several tribes and tribal associations. He also has co-authored books on gambling and gambling law. He can be reached at [email protected].

    Recent Feature Articles

  • Back to Basics: 10 Trends for 2023

    The 10 Trends for 2023 do not start with the recovery from the pandemic

  • Doing the Math

    The creativity of game design goes hand in hand with what keeps players at the game—the program math

  • Everything to Everyone

    Bally’s Chairman Soo Kim aims for the top, but will technology be his foil?

  • Regulating the Regulators

    Should regulators of the multi-state, billion-dollar casino industry come from the outside?

  • Paying It Forward

    How payment technology has successfully met the challenges of today’s gaming industry