Thursday, May 13, 2010

Cracks in Tribal Sovereignty Dam: Federal Overtime Laws Apply to Labor.

A Payallup tribal member on trust land was cheating his employees out of rightful pay.

The 9th Circuit Court of Appeals recently held in Solis v. Matheson, No. 07-35633 that the overtime provisions of the federal Fair Labor Standards Act (FLSA) apply to a business owned by a tribal member and operating on trust land within the boundaries of a reservation

The court made two additional decisions that impact tribal sovereignty. First, it determined that because the FLSA applied to this business, the Secretary of Labor could enter onto the reservation to investigate FLSA claims and obtain wage and hour records. Second, the court concluded that if the business was ordered to pay overtime wages and associated penalties and failed to do so, the court could appoint a receiver to take over the finances of the business to ensure that payment was made.

This decision represents another move by U.S. courts to apply federal employment laws to tribal employers, notwithstanding tribal sovereignty. Tribal members who own or operate businesses should be aware that they may be subject to a growing body of federal employment laws under these decisions, and may want to seek advice on whether these laws apply to them and how to comply

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