Sixth Circuit Panel Criticizes NLRB Jurisdiction Over Indian Tribes, But Affirms Exercise

When Congressional Subcommittee Chairman Phil Roe (R-TN) commenced a hearing last month on the Tribal Labor Sovereignty Act of 2015 (H.R. 511), he explained:

The subjective nature of the [NLRB]’s process for determining jurisdiction has also produced a mess of legal confusion. Years of litigation have produced inconsistent and misguided board decisions, compounding the uncertainty felt by Native American tribes and their businesses.

A July 1, 2015 decision by a panel of the Court of Appeals for the Sixth Circuit will do little to ease that uncertainty. In Soaring Eagle Casino and Resort v. National Labor Relations Board, Nos. 14-2405/2558 (6th Cir., July 1, 2015), the panel strongly questioned the recent jurisprudence in this area, but felt constrained by another panel’s decision weeks earlier in NLRB v. Little River Band of Ottawa Indians, No. 14-2239 (6th Cir., June 9, 2015) to uphold the Board’s assertion of jurisdiction.

As clearly and critically as it might put it, the Court stated:

[I]f writing on a clean slate, we would conclude that, keeping in mind “a proper respect both for tribal sovereignty itself and for the plenary authority of Congress in this area,” Santa Clara Pueblo, 436 U.S. at 60, the Tribe has an inherent sovereign right to control the terms of employment with nonmember employees at the Casino, a purely tribal enterprise located on trust land. The NLRA, a statute of general applicability containing no expression of congressional intent regarding tribes, should not apply to the Casino and should not render its no-solicitation policy void.

The Court reserved significant skepticism for one of the issues at the heart of the Board’s San Manuel holding and the recent Little River Band decision:

… [the] analytical dichotomy between commercial and more traditional governmental functions of Indian tribes. See Coeur d’Alene, 751 F.2d at 1116–17 (differentiating between “tribal self-government” and “commercial activity”); San Manuel, 475 F.3d at 1314–15. The Little River majority characterizes this distinction as one between “core” tribal concerns and those lying on the “periphery” of tribal sovereignty. 2015 WL 3556005, at *8. We believe this government-commercial or core-periphery distinction distorts the crucial overlap between tribal commercial development and government activity that is at the heart of the federal policy of self-determination. See Bay Mills, 134 S. Ct. at 2043 (Sotomayor, J., concurring) (“For tribal gaming operations cannot be understood as mere profit-making ventures that are wholly separate from the Tribes’ core governmental functions.”). Indeed, that distinction flies in the face of congressional pronouncements to the contrary in the IGRA.

Still, acknowledging it was not “writing on a clean slate,” the Court held it was “bound to conclude the NLRA applies to the Soaring Eagle Casino and Resort,” and to uphold the Board’s exercise of jurisdiction. The dispute among judges on separate Circuit Court panels, may provide opportunity for en banc review; and, the deepening split among Circuits could increase the chance of ultimate Supreme Court resolution.

In the meantime, it will be interesting to watch whether such express criticism of the fundamental reasoning expressed in the Board’s relatively recent complete reversal on the issue of jurisdiction over tribal government enterprises factors into the ongoing legislative debate over the Tribal Labor Sovereignty Act. The bill, the companion of which has been reported favorably by the Senate Committee on Indian Affairs, would add “any enterprise or institution owned and operated by an Indian tribe and located on its Indian lands” to the National Labor Relations Act’s list of exclusions.

More resources and commentary: