Tribes play defense as Casino War escalates

Table game dealers at one of the world’s largest casinos broke long-standing precedent on November 24th by voting to bring federally-regulated collective bargaining onto a tribal reservation. In what is believed to be the first National Labor Relations Board-supervised union election at a tribal casino, employees of Foxwoods Resort and Casino, owned by the Mashantucket Pequot Tribe, voted by a wide-margin to be represented by the United Auto Workers union.

The Tribe argued throughout the six-month union campaign that its tribal sovereignty prevents the National Labor Relations Board from asserting jurisdiction over the on-reservation casino. With the union’s success on November 24th, the Tribe will have to take its jurisdiction argument to the courts, an act that ultimately may lead to the U.S. Supreme Court.

Less than one year ago, tribal casinos were fairly insulated from union organizing efforts based on the widespread assumption that tribal sovereignty precluded applying the National Labor Relations Act to tribes. This assumption dissolved last February, when the U.S. Court of Appeals for the District of Columbia ruled that the Act applied to an on-reservation Indian casino operated by the San Manuel Band of Mission Indians.

In the San Manuel case, the tribe relied primarily on the long-held understanding that applying the National Labor Relations Act to its casino would violate federal Indian law by impinging upon its protected tribal sovereignty. The tribe buttressed this claim with evidence that revenues from the casino were used to fund tribal government programs and to provide for the general welfare of tribal members; the casino was operated pursuant to the federal Indian Gaming Regulatory Act; and the tribe already had exercised its sovereignty in this area by enacting a tribal labor ordinance to govern relations with casino employees. Several unusual facts were working against the tribe in this particular case, however, most notably that the tribe had either encouraged or allowed a union the tribe perceived to be more cooperative to communicate with casino employees while attempting to deny similar access to a competing union perceived to be more adversarial.

Against this somewhat anomalous background, the court held that while application of the National Labor Relations Act to employment at the casino might impinge on certain governmental activities, any impairment of tribal sovereignty in this context was negligible. The court stated that operation of a casino is not a traditional attribute of tribal self-government; in fact, the tribe’s governmental activities related to the casino were merely enacted to carry out a primarily commercial activity. Additionally, the vast majority of the casino’s employees and customers were not members of the tribe and lived off-reservation.

The court also held that the National Labor Relations Act applied because the tribe did not fall within the Act’s exception for employers who are "any State or political subdivision thereof."

Impact On Tribal Casinos And Recommendations

The full impact of the November 24th vote at Foxwoods remains to be seen, however, it is quite likely that unions, with an eye on the tribal gaming industry’s 670,000 employees and estimated annual revenues of $25.7 billion, will take the vote as a cue to expand their organizing efforts to tribal casinos nationwide. The UAW and other unions are already looking to organize more of Foxwoods’ 10,000 employees, and the NLRB has scheduled a Board election for December 20, 2007, at the Saginaw Chippewa Indian Tribe’s Soaring Eagle Casino & Resort where the Teamsters union is targeting housekeeping employees.

Without conceding that such laws apply, but simply to prepare to resist possible unionizing efforts until a definitive ruling is issued by the U.S. Supreme Court, tribal employers must become familiar with federal labor law, in particular, the National Labor Relations Act.

Tribal casinos can best defeat unionizing efforts by heading them off before they begin, rather than attempting to defend against an already active campaign. In many cases, tribal employers have the advantage of being able to provide wages and benefits as good as (and frequently better than) those available in the surrounding labor market. Becoming or remaining the "employer of choice" is the most effective defense against union organizing. Implementation of a fair and accessible grievance process, encouraging direct communication between management and employees, and giving employees opportunities to participate in workplace consensus-building and workplace decision-making also serve as effective deterrents to union organizing and often align with traditions of tribal sovereignty and decision-making.

Various other actions are recommended to control the employment environment prior to and during a unionizing campaign, including enacting tribal labor ordinances and workplace policies regarding non-solicitation, employee evaluations, and apparel; training supervisors to identify and respond to nascent union organizing efforts; and organizing employee information sessions to educate employees about the true facts and implications of working in a unionized environment. Due to the complicated nature of federal labor law, it is recommended that these initiatives be reviewed in detail with an experienced management-side labor law firm that also has Indian law expertise.

How Dorsey Can Help

Dorsey attorneys, in anticipation of union organizing efforts at tribal casinos, have been actively advising tribal business entities on labor and employment matters. Recently, Dorsey attorneys conducted a day-long training seminar on union avoidance and related issues for tribal employers in Central and Northern Minnesota (as well as Iowa, Wisconsin, Nebraska, and Michigan).


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