HOT TOPICS IN EMPLOYMENT LAW
Ed Clay Goodman, Partner Hobbs, Straus, Dean & Walker, LLP 806 S.W. Broadway, Suite 900 Portland, OR 97211 Ph: (503) 242-1745
[email protected] http://www.hsdwlaw.com
OVERVIEW General rules of applicability of federal employment laws General applicability and sovereign immunity Independent Contractor determination by US DOL Overlap of FMLA and Section 504 issues Drug Free Workplace and legalization of marijuana Benefits for same sex couples Tribal Labor Sovereignty Act (NLRA exemption) Additional employment statutes
General Applicability Most federal labor & employment laws are laws of general
application. There are various opinions regarding whether federal laws of
general application apply to Indian tribes among the various Federal Court of Appeals. The 10th, 8th, and D.C. circuits follow well established principles
of tribal sovereignty and self-governance, and require a showing of congressional pronouncement or clear legislative intent before it applies statutes of general applicability to Indian tribes. The 9th, 7th & 11th circuits have adopted an approach that
creates a presumption that when Congress passes a law of general applicability, it applies to Indian tribes. This approach is known as the “Tuscarora rule”; it is based on USSC dicta.
TUSCARORA RULE “[G]eneral acts of
Congress apply to Indians as well as to all others in the absence of a clear expression to the contrary.” – U.S. Supreme Court (1960).
Coeur d’Alene EXCEPTIONS EXCEPTIONS: The 9th, 7th & 11th circuits apply the
“Tuscarora rule” unless:
(1) the general law interferes with “exclusive rights of self-governance in purely intramural matters”;
(2) the law abrogates treaty rights; or
(3) there is proof “by legislative history or some other means that Congress intended the law not to apply to Indians on their reservations.” – Donovan v. Coeur d’Alene Tribal Farm (9th Cir. 1985).
FEDERAL LABOR & EMPLOYMENT LAWS
STATUES EXPRESSLY EXEMPTING INDIAN TRIBES
Title VII of the Civil Rights Act (“Title VII”) American With Disabilities Act (“ADA”) (but Section 504 applies to IHBG)
STATUTES OF GENERAL APPLICATION
Age Discrimination in Employment Act (“ADEA”) Family Medical Leave Act (“FMLA”) Section 1981 of the Civil Rights Act of 1966 (“Section 1981”) National Labor Relations Act (“NLRA”) Fair Labor Standards Act (“FLSA”) Employee Retirement Income Savings Act (“ERISA”) Occupation Health and Safety Act (“OHSA”) Federal Insurance Contributions Act (“FICA”) Federal Unemployment Tax Act (“FUTA”)
General Applicability and Sovereign Immunity Qualified Immunity
The 9th circuit has stated that “…tribal immunity extends to individual tribal officials acting in their representative capacity and within the scope of their authority.”
Board members & staff hold qualified sovereign immunity where their activities are w/in the scope of their office, are in good faith, and are not malicious or reckless.
The purpose of qualified immunity is so that officers and employees will not be unduly hampered, deterred, and intimidated in their discharge of their duties.
The 10th circuit has held that injunction is the only relief available in a suit against a tribal government official for exceeding his/her authority.
The 10th circuit also held that tribal official immunity fails where the tribal official is acting in accordance with a tribal law that itself violates federal law.
General Applicability and Sovereign Immunity Sovereign Immunity of TDHE It is well-established that Indian tribal housing authorities, as agencies of an Indian tribe, share the tribe’s sovereign immunity from suit. It is an open question, however, as to whether tribal housing authorities waive that immunity with “sue and be sued” clauses. The 9th Circuit has noted that whether a “sue and be sued” clause in a tribe’s enabling ordinance effectuates a waiver of tribal sovereign immunity remains a “live issue for determination.”
The 10th Circuit concluded that the sue and be sued provision of the corporate charter of a tribal tobacco company constituted an “unequivocal” waiver.
General Applicability and Sovereign Immunity Where a generally applicable statute is found to apply to Indian
tribes, it means that the provisions of the statute apply. The relevant federal agency has authority to enforce it against the
tribe or TDHE in federal court (no sovereign immunity as against suit by the United States) However, applicability of provisions does not mean that sovereign
immunity is waived to private enforcement actions. Chayoon v. Chao, Second Circuit. Held that FMLA applies to
Mashantucket Pequot Tribe – but such application does not waive Tribe’s immunity from suit by individual.
General Applicability and Sovereign Immunity Recent District Court case from Kansas runs counter to this
principle. Coppe v. Sac & Fox Casino HealthCare Plan, November 5, 2015
Individual sued Tribal plan for alleged ERISA violations. Tribal plan asserted sovereign immunity. Court found that ERISA expressly applied to Indian tribes
commercial activities, and that therefore Tribal casino plan’s immunity was waived.
Did not address the distinction set out in Chayoon v. Chao
between applicability and sovereign immunity. May be limited to ERISA, which expressly includes Tribes and sets
out a cause of action in federal court, but language is broad.
DOL Independent Contractor Interpretation 15-01 Administrator’s Interpretation 15-01 (July 15, 2015)
Application of Fair Labor Standards Act “suffer or permit to work” language Determines that many employers are misclassifying employees as “independent contractors” Tightening the definition Result is that DOL will examine classification of “independent contractors” more carefully FLSA’s wage and hour laws will be applied, unemployment insurance, payroll taxes, other employment-related costs and benefits
DOL Independent Contractor Interpretation 15-01 Administrator’s Interpretation 15-01 (July 15, 2015) “The FLSA’s definition of employ as ‘to suffer or permit to
work’ and the later-developed ‘economic realities’ test provide a broader scope of employment than the common law control test.” “FLSA defines ‘employ’ broadly as including ‘to suffer or
permit to work,’ 29 U.S.C. 203(g), which clearly covers more workers as employees, see U.S. v. Rosenwasser, 323 U.S. 360, 362-63 (1945).”
DOL Independent Contractor Interpretation 15-01 An “entity ‘suffers or permits’ an individual to work if, as a
matter of economic reality, the individual is dependent on the entity.” “The Supreme Court and Circuit Courts of Appeals have developed a multi-factor ‘economic realities’ test to determine whether a worker is an employee or an independent contractor under the FLSA.” “The economic realities of the worker’s relationship with the employer control, rather than any technical concepts used to characterize that relationship.”
DOL Independent Contractor Interpretation 15-01 Factors in “economic realities” test (no one factor is
controlling): (A) the extent to which the work performed is an integral part
of the employer’s business; (B) the worker’s opportunity for profit or loss depending on his or her managerial skill; (C) the extent of the relative investments of the employer and the worker; (D) whether the work performed requires special skills and initiative; (E) the permanency of the relationship; and (F) the degree of control exercised or retained by the employer
DOL Independent Contractor Interpretation 15-01 “In applying the economic realities factors, courts have
described independent contractors as those workers with economic independence who are operating a business of their own.” “On the other hand, workers who are economically
dependent on the employer, regardless of skill level, are employees covered by the FLSA.” “The economic realities of the relationship, and not the label
an employer gives it, are determinative.” An “agreement between an employer and a worker
designating or labeling the worker as an independent contractor is not indicative of the economic realities of the working relationship and is not relevant to the analysis of the worker’s status.”
FAMILY AND MEDICAL LEAVE ACT (“FMLA”) The FMLA allows employees to take as many as twelve weeks
of unpaid leave during a twelve-month period if the employee or immediate family member has a “serious health condition.” A “serious health condition” means “an illness, injury, impairment, or physical or mental condition that involves (A) inpatient care in a hospital, hospice, or residential medical care facility; or (B) continuing treatment by a health care provider.” “Employees” are eligible if they have worked for their employer
at least 12 months, at least 1,250 hours over the past 12 months, and work at a location where the company employs 50 or more employees within 75 miles. The FMLA permits employers to require employees to substitute
any accrued paid vacation leave for FMLA leave.
FMLA & INDIAN TRIBES Indian tribes are not expressly exempted from the
FMLA’s coverage.
2nd circuit has held that tribes are immune from suit
under the FMLA. 9th circuit has held that tribal courts should be allowed
to assess their jurisdiction in FMLA cases.
FMLA & SECTION 504 Overlap and additional burdens FMLA leave does not mean reasonable
accommodation has been satisfied You may have additional responsibilities to provide
reasonable accommodation even after FMLA leave is exhausted This may include variations in work schedule
Drug Free Workplace Act and Legalization of Marijuana NAHASDA requires applicability of Drug Free
Workplace Act to IHBG-funded programs Questions have been raised about marijuana for
programs located in states that have legalized marijuana for recreational or medical use Does DFWA still apply to marijuana in those states? Short answer: yes.
DRUG-FREE WORKPLACE ACT OF 1998 (DFWA) The DFWA requires federal contractors and
grant recipients to follow certain procedures and policies in order to certify, to the awarding agency, that they will provide a drug-free workplace.
DFWA & INDIAN TRIBES The DFWA applies to Indian tribes who receive
NAHASDA funds and requires that recipients: (1) publish & deliver a hard copy to employees stating that
the unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited in the workplace and that specific actions will be taken for violations of the policy, (2) notify HUD w/in 10 days of receiving actual notice of
an employee’s drug related conviction, and
(3) impose a sanction or require drug treatment before
any employee convicted of a drug statute violation.
DFWA & INDIAN TRIBES Tribes/TDHEs who fail to abide these provisions risk having
their NAHASDA grant suspended, terminated, or being debarred from future federal grant program participation. Many tribes/TDHEs randomly test their employees for drug use.
This is not, however, required by DFWA.
DFWA & INDIAN TRIBES Despite legalization of marijuana by the states, possession, use,
manufacture and distribution of marijuana is prohibited by federal law. Further, state law regarding marijuana is not applicable to Indian
tribes. Therefore, even if the state in which a tribe is located has
legalized marijuana, a tribe/TDHE can still prohibit marijuana use by employees, and can still include it in drug testing (where such testing is otherwise applicable).
DFWA & INDIAN TRIBES On the other hand, some tribes are considering legalizing, or
already have legalized, marijuana. This situation presents a more difficult question under DFWA.
HUD would likely determine that DFWA continues to apply to
marijuana use by employees, even if legalized by the tribe, and that it would be inconsistent with DFWA to allow use of marijuana in the workplace. However, since DFWA does not require drug testing, a tribe or
TDHE that does drug testing can remove marijuana as a controlled substance that employees are tested for.
Benefits for Same Sex Couples Many Tribes/TDHEs provide health insurance benefits to the
spouses and/or domestic partners of their employees. Questions have been raised about whether Tribal employers
can provide such insurance benefits to same sex partners (spouses or domestic partners), and whether they may deny these benefits to same sex partners. This issue has been complicated by Congressional action (the
Defense of Marriage Act) and subsequent Supreme Court decisions striking down sections of that Act.
Defense of Marriage Act (“DOMA”) DOMA was passed by Congress in 1996, and was signed into
law by President Bill Clinton. Section Two of DOMA provides that no state or Indian tribe is
required to give effect to same sex marriages performed under the laws of other jurisdictions. Section Three of DOMA defines marriage for federal purposes
as the union of one man and one woman.
Defense of Marriage Act (“DOMA”) Section Three of DOMA was struck down by the U.S. Supreme Court in
United States v. Windsor (2013). The Court held that the denial of federal marriage benefits to same sex couples was an unconstitutional deprivation of the equal liberty of persons protected by the Fifth Amendment. Section Two of DOMA was struck down by the U.S. Supreme Court as
to the states in Obergefell v. Hodges (2015). The Court held that states were required under the due process and equal protection clauses of the 14th Amendment to both recognize same sex marriages from other jurisdictions and to permit same sex marriages under their own jurisdictions. Based on these cases, and on other recent changes in federal and
state law, most non-tribal private and public sector employers who offer such benefits do not deny benefits to same sex couples.
Application to Tribal Employers Obergefell did not expressly overrule the applicability of Section Two of
DOMA to Indian tribes. Tribal employers may provide benefits to same sex partners and
spouses on the same terms and conditions as provided to opposite sex partners and spouses. Less clear is whether Tribal employers may deny same sex partners
and spouses benefits if offered to opposite sex spouse and partners. Indian Civil Rights Act (“ICRA”) equal protection claims could be
brought in Tribal Courts. There appears to be a trend to condition federal funding on
nondiscrimination based on sexual orientation.
HUD “Dear Tribal Leaders” letter January 28, 2015 regarding proposed rule
NATIONAL LABOR RELATIONS ACT (“NLRA”) The NLRA prohibits employers from
discriminating against employees who chose to unionize, or join labor organizations, to promote collective bargaining and mutual aid or protection. The NLRA is administered by the National
Labor Relations Board (NLRB).
NLRA & INDIAN TRIBES The NLRB had previously held that the NLRA does not apply to Indian
tribes. In 2004, however, the NLRB reversed its position and held that:
The NLRA may apply to both on and off reservation tribal enterprises.
The NLRB will determine its jurisdiction on a case-by-case basis by using the Tuscarora doctrine and the Coeur d’Alene exceptions.
Reservation businesses not wholly owned/controlled by a tribe are not exempt from the NLRA.
The NLRB can decline to exercise jurisdiction where: (1) the tribal health consortium is providing a “unique governmental function,” (2) the impact on interstate commerce is limited, and (3) the consortium does not compete with other hospitals in the NLRB’s jurisdiction.
NLRA & INDIAN TRIBES The D.C., 6th, & 9th circuits agree that the NLRA applies to
Indian tribes. The 9th circuit, however, recognizes that the Act may not apply to off reservation tribal activity operating under the Indian Self-Determination Education and Assistance Act (ISDEAA).
The 10th circuit has found the NLRA inapplicable to Indian tribes.
Tribal Labor Sovereignty Act Concerns the applicability of the NLRA to Indian
tribes and tribal enterprises Would expressly exempt tribes and tribal enterprises
from coverage of the NLRA S. 248 and HR 511 – both introduced and passed out
of Committee HR 511 passed in the House on November 17, 2015
and goes to the Senate next for consideration Even if it passes both houses, may be subject to veto
EMPLOYEE RETIREMENT INCOME SAVINGS ACT (“ERISA”) ERISA establishes standards for employee benefit and retirement
plans. ERISA applies to any employee benefit plan if it established or
maintained: (1) by any employer engaged in commerce or in any industry or activity affecting commerce; or (2) by any employee organization or organizations representing employees engaged in commerce or in any industry or activity affecting commerce; or (3) by both. ERISA does not apply to: (1) government plans, (2) church plans,
(3) plans outside the U.S., (4) excess plan that are unfunded, and (5) plans that are established solely for the purpose of complying with workman’s comp., unemployment comp., or insurance laws.
ERISA & INDIAN TRIBES In 2006, the term “government plan” was amended to include a
plan which is: established and maintained by an Indian tribal government, a subdivision of an Indian tribal government, or an agency or instrumentality of either (“ITG”). PPA’s Technical Explanation states that a “governmental plan”:
Includes a plan of an ITG, all of the participants of which are teachers in tribal schools, but Does not include a plan covering tribal employees who are employed by a hotel, casino, service station, convenience store, or marina operated by a tribal government.
ERISA & INDIAN TRIBES Prior to the amendment, the 7th & 9th circuits applied
ERISA to Indian tribes. After the amendments, the 10th circuit found that not
all plans established and maintained by tribes will fall under the governmental plan exemption because the amended provision makes a distinction between “essential governmental functions” and “commercial activities.”
ERISA Case Law Update Jurisdictional Issues Coppe v. The Sac & Fox Casino Healthcare Plan (March 2015)
Held that tribal courts do not have jurisdiction over ERISA actions brought under commercial plans.
Cited Nevada v. Hicks for the preposition that tribal courts are not courts of general jurisdiction, and without an explicit grant of jurisdiction over ERISA claims by Congress, tribal courts lack jurisdiction.
Life Ins. Co. of N. Am. v. Hudson Ins. Co. (April 2015)
Held that complete preemption under commercial ERISA plans is limited to claims brought by a beneficiary or participant to a plan, and is further limited to claims to recover benefits due, to enforce rights under the terms of the plan, or to clarify rights to future benefits under the terms of the plan.
The claim in this case was brought by one insurer against another for reimbursement of benefits paid. The court required exhaustion of tribal remedies.
ERISA Case Law Update Sovereign Immunity Vandever v. Osage Nation Enter., Inc. (March 2009)
Held that tribal sovereign immunity is waived for ERISA claims under commercial plans, even without a waiver by a tribe.
Although no tribal waiver had occurred, the court held that a Congressional waiver had abrogated tribal sovereign immunity for commercial ERISA cases based on the 2006 ERISA amendments by Congress together with court decisions finding Tribal commercial plans subject to ERISA.
Coppe v. The Sac & Fox Casino Healthcare Plan (November 2015)
Held that the Tribe had clearly waived its sovereign immunity in its commercial plan governed by ERISA by the language of its plan: “Plan member may file suit in a federal court.”
The court cited C&L Enterprises for the preposition that a tribe could waive sovereign immunity through choice-of-law and arbitration clauses.
OCCUPATIONAL HEALTH & SAFETY ACT (“OSHA”) OSHA establishes requirements for workplace safety and
health. It also establishes duties for “employers” and “employees.” Specifically:
“Employers”— (1) shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees, and (2) shall comply with occupational safety and health standards promulgated under this chapter.
“Employees”—shall comply with occupational safety and health standards and all rules, regulations, and orders issued pursuant to this chapter which are applicable to his own actions and conduct.
OSHA & INDIAN TRIBES OSHA does not expressly exempt Indian
tribes from its coverage. The 10th circuit has held that OSHA does not
apply to Indian tribes. The 2nd, 7th, & 9th circuits have held that
OSHA does apply to Indian tribes.
FEDERAL UNEMPLOYMENT TAX ACT (FUTA) The FUTA tax, which has only an employer portion, is
used to fund unemployment benefits. As of December 21, 2000, Indian tribes must either:
file and pay the full FUTA tax on their employees; or elect to participate in the State Unemployment system.
FUTA & INDIAN TRIBES General exception: services performed “in the employ of
tribes” are not subject to the FUTA tax, unless the tribal government elects not to participate in the state unemployment system. If an entity is wholly independent from the tribe, then it must pay FUTA; however if the entity is operated by or wholly owned by the tribe, then the entity has no liability for FUTA. The 9th circuit held that this exception applies only where tribe or its instrumentality was a common-law employer of worker performing services; exception did not apply where tribe merely was “statutory employer,” in essence, nothing more than paymaster.
INDIAN vs. TRIBAL HIRING PREFERENCE The ISDEAA contains an express authorization for
Indian tribes to apply a tribal-specific hiring preference vs. a general Indian hiring preference. NAHASDA regulations used to state that Indian tribes
must apply Indian preference in hiring and contracting. The 2008 amendments to NAHASDA state that tribal
employment laws (including regulations and tribal ordinances) adopted by a tribe, shall apply to a tribe receiving NAHASDA grant money.
