Did you know there’s a loophole in employment law big enough to fit an entire casino?
That’s not an exaggeration. In one recent case, an employee said she was pushed out after giving birth. She sued under the Fair Labor Standards Act. The court never even reached the merits because her employer was legally immune from being sued at all.
TL;DR: A casino worker said she was pushed to quit after giving birth and sued under the Fair Labor Standards Act (FLSA). The Sixth Circuit affirmed dismissal, not because her allegations lacked merit, but because the casino is tribally owned and therefore immune from private suit unless it clearly waives immunity or Congress says otherwise. Everyone agreed the FLSA’s substantive requirements apply, but the fight was over whether she could sue.
🔗 Read the Sixth Circuit opinion
When “following the law” isn’t enough
The employee worked at a steakhouse inside a casino owned by the Hannahville Indian Community, a federally recognized tribe. She claimed her manager pressured her to resign rather than accommodate her postpartum needs.
She sued under the FLSA. But the case ended before it ever began. The casino explained that, as a tribal enterprise, it shares the sovereign immunity of the tribe that owns it. That means it cannot be sued in state or federal court unless the tribe expressly waives that immunity or Congress clearly takes it away.
The employee argued that the tribe had already waived its immunity because its constitution says the tribal council will not act in conflict with federal law. The Sixth Circuit was not convinced. The court said that kind of language is not a waiver. It is only a promise to follow the law, and a promise to follow the law is not the same as agreeing to be sued for breaking it.
The tribe’s own Sovereignty Code makes the standard even clearer. It requires any waiver of immunity to be made through a formal, written resolution of the Tribal Council. No such resolution existed here.
Because there was no clear waiver, and because Congress has not said that the FLSA overrides tribal immunity, the court said it had no jurisdiction to hear the case. The employee’s related state-law claims fell for the same reason.
(Procedurally: the district court dismissed without prejudice, and the Sixth Circuit affirmed.)
Why this matters for everyone else
Most employers are not sovereign governments, but this case is a fascinating reminder that not every “employer” plays by the same legal rules.
1. “Covered” does not always mean “can be sued.”
Federal workplace laws like the FLSA, Title VII, and the ADA may apply in theory, but employees cannot sue tribal governments or other sovereign entities without a clear waiver or congressional authorization.
So while your company may dream of diplomatic immunity some form of immunity, it still has to comply like everyone else.
2. Jurisdiction can make or break a case.
Knowing who the employer is, and which legal system governs it, can determine whether a claim ever gets heard.
Translation: unless your company has its own flag, national anthem, and seat at the United Nations, you are still bound by the FLSA.
3. Immunity does not mean impunity.
Tribal entities may be shielded from private lawsuits, but they still face potential agency enforcement, reputational harm, and morale problems if they ignore federal standards.
In other words, they can win the legal battle and still lose the HR war.
The bigger takeaway
Most employers are not sovereign governments. You do not get immunity, and you cannot count on legal loopholes to make claims disappear.
If you operate in the private sector, you must comply with the Fair Labor Standards Act, Title VII, the ADA, and the rest, because your employees can (and will) sue if you do not.
A few employers sit behind the shield of sovereign immunity. The rest of us follow the rules, and that is exactly how the system is supposed to work.