It was with some dismay that I read press accounts ("Bill introduced to legalize tribal workers' compensation program," Indian Country Today (Vol. 23, Iss. 39) declaring that the "Staffing Solutions" program, offered by the Fort Independence Reservation as an alternative to the state workers' compensation program, is "illegal."
Just because some ill-informed state bureaucrat, such as the California State Insurance Commissioner, has made bold accusations that tribal workers' compensation programs are illegal does not mean that they are. The programs are legal and have been around, in the form of self-insurance pools with reinsurance or "gap" insurance features, in Indian country for quite some time. The state's accusations, however, create a false impediment to the viability of tribal workers' compensation programs by making it difficult or impossible for tribes to obtain the very coverage the Commissioner claims the absence of renders programs illegal. Pretty circuitous reasoning, if you ask me - kind of like Yossarians's Catch-22.
State officials also miss a very important point: the Fort Independence workers' compensation law does not have to mirror state law and, certainly, the state cannot enforce its law against the tribe, either as an employer or as a supplier of employees. A second very important point is that the tribe's workers' compensation law would provide coverage equal to or greater than the state workers' compensation system, and without the administrative and legal baggage which has brought the state system to its knees.
The truth is the tribal program is far superior to the state system and offers even better benefits to the work force more effectively, efficiently, and at a reduced cost. That is the real threat. The state does not want tribes to expose the ridiculously irresponsible conditions that have been placed upon the state's workers' compensation system by the insurance industry, labor unions and members of my own profession, personal injury and workers' compensation attorneys.
A tribal workers' compensation program also provides an economic vehicle to those tribes that, because of their isolated locations, will never have viable casino operations of any appreciable size. Tribes might even be able to contribute a "fair share" to the state workers' compensation system or to the State Insurance Commission's budget for administrative costs that may be associated with activities the state would perform in support of tribal workers' compensation programs. This would further benefit the state by the tribes contributing the resources for those costs.
It's time for the state of California to recognize the fact that tribal economic development will play a significant and permanent role in California's future. The state must explore alternative solutions with tribes as new economic partners to address the desperate condition of the state workers' compensation system.
Far from being "illegal," the tribes have a sovereign right to make their own laws. They don't have to pass the "mirror" test just because they have some effect within state borders. This is especially true when there is a financial, social and economic benefit gained by both the state and its citizens from tribal activity. We need to start working proactively towards solutions that will improve California's economy and create more jobs. We can only do this by working together.
Harold Monteau is a partner in Monteau & Peebles LLP, a national law firm specializing in federal Indian law, complex government negotiations, business transactions and governmental lobbying. Monteau has more than 30 years of experience in Indian affairs and tribal government with 16 of those years as a tribal attorney for various tribes. In addition, he served three years as chairman of the National Indian Gaming Commission.