STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

LAC COURTE OREILLES
OJIBWE SCHOOL, Employer

UNEMPLOYMENT INSURANCE CONTRIBUTION LIABILITY DECISION
Account No. 532226, Hearing No. S0300130HA


An administrative law judge (ALJ) for the Division of Unemployment Insurance of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own.

DECISION

The decision of the administrative law judge is affirmed. Accordingly, the appellant is liable for the payment of delinquent contributions as set forth in the appeal tribunal decision.

Dated and mailed November 9, 2005
laccoor . ssd : 105 : 8  ER 451

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner

MEMORANDUM OPINION

The employer argues that, for several reasons, it had justification for not timely filing an application with the Department of Workforce Development for reimbursement financing pursuant to Wis. Stat. § 108.152. The commission disagrees, and so has affirmed the appeal tribunal decision.

The employer argues that it never received the October 23, 2002 determination of employer status, the document that triggered a 30-day window in which the employer could elect reimbursement financing for the time period at issue. The employer did not establish non-receipt of that determination of coverage, however. The director and the employer's attorney argue that the initial determination was not sent to the director's attention; the evidence does not establish that the director requested that documents be sent directly to her, though, until sometime in the spring of 2003. Thus, the evidence establishes that the determination was sent to the employer's address of record with the department. The director testified that there were no instructions in her office during the time in question for her to get mail from the department. She testified that whichever secretary or receptionist had the time, would open the mail and distribute it. In addition, department records indicate that the director was not herself overly confident with mail routing at the employer's offices. In a May 20, 2003 conversation with department employee Linda Stewart, the director admitted that the initial determination had been "sitting around" the office. The director's own notes, Exhibit 5A, indicate that she told a department employee on March 15, 2003 that, due to the address on unemployment insurance correspondence, she was not receiving mail timely, or at all, "depending on who received and opened" the mail. Finally, none of the director's assertions are to the effect that the employer did not receive the determination. Instead, they are all that the director did not receive it. This evidence is manifestly too weak to overcome the presumption that properly addressed mail was received by the addressee.

The employer also points to the so-called "trust doctrine" between the United States (and its political subdivisions) and Indian tribes. This doctrine is as old as the country, the broad scope of which was stated by Justice Marshall in 1831: "[Indians] are in a state of pupilcy; their relation to the United States resembles that of a ward to his guardian. They look to our government for protection; rely upon its kindness and its power; appeal to it for relief of their wants . . ." Cherokee Nation v. Georgia, 30 U.S. (5 Pet.) 1, 17, 8 L.Ed. 25 (1831). This doctrine is again enunciated in the Final Report of the American Indian Policy Review Commission, established by Congress in 1975 to conduct a comprehensive review of the historical and legal developments underlying the Indians' unique relation to the United States:

The Federal trust responsibility emanates from the unique relationship between the United States and Indians in which the Federal Government undertook the obligation to insure the survival of Indian tribes. It has its genesis in international law, colonial and U.S. treaties, agreements, Federal statutes and Federal judicial decisions. It is a "duty of protection" which arose because of the "weakness and helplessness" of Indian tribes "so largely due to the course of dealings of the Federal Government with them and the treaties in which it has been promised * * *." Its broad purposes, as revealed by a thoughtful reading of the various legal sources, is to protect and enhance the people, the property and the self-government of Indian Tribes. (Footnotes omitted).

Vol. I, American Indian Policy Review Commission Final Report, p. 126 (submitted to Congress May 17, 1977) (cited in St. Paul Intertribal Housing Bd. v. Reynolds, 564 F.Supp. 1408, 1413-14 (D. Minn. 1983)). The district court in Reynolds also noted that it was well established that statutes passed for the benefit of Indians must be liberally construed in their favor. Reynolds, 564 F.Supp. at 1411-12 (citing Bryan v. Itasca County, 426 U.S. 373, 96 S. Ct. 2102, 48 L.Ed. 2d 710 (1976)).

Another way of phrasing the trust relationship is as that of a "fiduciary relationship." Joint Tribal Council of Passamaquoddy Tribe v. Morton, 528 F. 2d 370, 379 (1st Cir. 1975). This trust or fiduciary relationship does require specific legislation on the part of Congress, and such of course is present here with the federal FUTA amendment underlying the issue in the case. The employer argues, and it is not disputed, that this trust doctrine applies to the State. See Washington v. Washington State Commercial Passenger Fishing Vessel Association, 443 U.S. 658 (1979). It also is not disputed that application of the trust responsibility applies to administrative agencies and other governmental entities as well. Not even this doctrine, however, is so broad as to excuse the employer's failure in this case.

First and foremost, the law requires only that states offer reimbursement financing to Indian tribes "at such time as may be provided by state law." 26 U.S.C. 3309 (2005). That is exactly what the department did in the present case: it offered the employer the option of reimbursement financing at the time allowed by state law. Second, that the department admittedly gave the employer erroneous information prior to the time period at issue cannot justify the department and the commission in ignoring the laws pursuant to which the department gave the employer a valid opportunity for electing reimbursement financing. The misinformation in question was that, after the law changed pursuant to which Indian tribes now had the option of reimbursement financing, a department representative told the employer it would have to obtain 501(c)(3) status from the Internal Revenue Service. After the enactment of Wis. Stat. § 108.152, there was of course no such requirement. Prior to the enactment of that statute, however, the employer would have had to obtain 501(c)(3) status in order to elect reimbursement financing. This provision of erroneous information to the employer was harmless, however, because the employer had obtained 501(c)(3) status before the department issued its October 23, 2002 determination of coverage. The employer has argued that it believed no more was required of it after it submitted its 501(c)(3) documentation to the department. There is no evidence whatsoever in the record, however, to justify this belief on the employer's part. At no point was the employer ever told that its provision of its 501(c)(3) documentation would be all that was necessary for it to obtain reimbursement financing.

Nor can the employer claim ignorance of the documentation required for electing reimbursement financing, even granting that it apparently lost the reimbursement financing documentation sent to it with the October 23, 2002 determination of coverage. The record establishes at least five separate occasions in the previous decade, in which the department sent that same documentation to the employer, because the employer had been considering applying for reimbursement financing for that length of time.

It is not even the case, finally, that the reimbursement financing election statute has any kind of "good cause" provision excusing late filings of elections. The commission need not decide whether the trust doctrine warrants the reading into the statute of such a provision; even if it does, the employer has not come close to establishing good cause for its late filing. For these reasons, and for those stated in the appeal tribunal decision, the commission has affirmed that decision.

cc:
Attorney Kris Goodwill
Attorney Larry Leventhal
Jorge L. Fuentes



Appealed to Circuit Court.

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