Martinez v. CITIES OF GOLD CASINO

Certiorari Denied, No. 31,757, July 15, 2009

IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO

Opinion Number: 2009-NMCA-087

Filing Date: April 24, 2009

Docket No. 28,762

DAVID MARTINEZ,

Worker-Appellant,

v.

CITIES OF GOLD CASINO,

POJOAQUE PUEBLO, and

FOOD INDUSTRIES SELF-INSURANCE FUND,

Employer/Insurer-Appellees.

APPEAL FROM THE WORKERS’ COMPENSATION ADMINISTRATION

Gregory Griego, Judge

Annie Laurie Coogan

Santa Fe, NM

for Appellant

Pueblo of Pojoaque Legal Department

Frank A. Demolli

Steffani A. Cochran

Santa Fe, NM

for Appellees

OPINION

VANZI, Judge.

1

{1} David Martinez (Worker) appeals from a compensation order granting only

partial relief. In the proceedings below, the Workers’ Compensation Judge (WCJ)

determined that Worker had been wrongfully terminated by his employer, the Cities

of Gold Casino (Casino), which does business as Pojoaque Gaming Inc. (PGI).

Worker claimed he was terminated in retaliation for having filed a workers’

compensation claim. Although the Workers’ Compensation Act (the Act) expressly

provides that the remedy for retaliatory discharge is mandatory rehiring, the WCJ

concluded that he lacked authority to award such relief in this case. A separate tribal

entity that had not waived its sovereign immunity was unwilling to reissue the

employment license Worker required to resume his former employment. On appeal,

Worker challenges this aspect of the compensation order as well as the adequacy of

the remedies and cost-sharing provisions established in NMSA 1978, Sections 52-1-

28.1, -28.2, and -54(F) (1990, as amended through 2003) of the Act. We reverse in

part, affirm in part, and remand for further proceedings.

I. BACKGROUND

A. Worker’s Initial Injury and Workers’ Compensation Claim

{2} On February 9, 2006, Worker filed a claim with the Workers’ Compensation

Administration (WCA) against PGI. In his claim, Worker alleged that he suffered an

“[o]ccupational injury,” to wit, a “tear of [the] ligaments” of his “left foot.” This

injury was allegedly sustained while “[m]oving . . . [a money] cart” during the course

of his duties as a “[m]anager—hard and soft count” at the “Cities of Gold Casino

Pojoaque Pueblo.”

{3} Named as defendants in Worker’s complaint were the “Cities of Gold Casino,

Pojoaque Pueblo and Food Industries, Industries [sic] Self-Insurance Company.”

Despite the fact that only these three entities were named by Worker in his complaint,

the complex nature of the manner in which the Cities of Gold Casino is owned and

operated by the Pojoaque Pueblo (Pueblo) ultimately led to the inclusion of additional

defendants during the WCA proceedings. A brief description of the relationships

among the various defendants follows.

B. The Defendants

{4} The Casino is a commercial business enterprise that is owned and operated by

PGI. PGI is an independent corporation owned by the Pueblo, a federally recognized

Indian tribal government. Pursuant to Pueblo Tribal Council Resolution 2006-134,

the Buffalo Thunder Development Authority (BTDA), a “political subdivision and

unincorporated instrumentality” of the Pueblo, obtained ownership of PGI on

2

December 8, 2006. In addition to being owned and operated by PGI, an entity owned

by BTDA, which is in turn a political subdivision of the Pueblo, the Casino and its

operations are heavily influenced by the decisions of yet another independent Pueblo

entity: the Pueblo of Pojoaque Gaming Commission (PPGC). PPGC is the sole

entity responsible for the issuance of gaming licenses that certain employees of the

Casino are required to possess pursuant to the gaming compact (Compact) entered

into by the Pueblo and the State of New Mexico. In addition to requiring the Pueblo

to issue certain Casino employees gaming licenses—which, as noted, the Pueblo does

through PPGC—the Compact also requires the Pueblo to provide workers’

compensation insurance to all employees working at the Casino “through

participation in programs offering benefits at least as favorable as those provided by

comparable state programs.” The Food Industries Self-Insurance Fund (FISIF) is the

workers’ compensation insurance carrier PGI contracted with to provide workers’

compensation insurance for the employees of the Casino. The Casino, PGI, the

Pueblo, BTDA, PPGC, and FISIF were all parties below and are referred to

collectively as “Defendants” when referencing the lower court case.

C. Proceedings Before the WCA Regarding Worker’s Injury Claim

{5} Once filed, the process of adjudicating Worker’s injury claim began with a

WCA mediation conference in which Worker, his attorney, and attorneys for

Defendants took part. At that time, the parties agreed that “the [WCA] does have

jurisdiction over this claim.” Aside from this single agreement, the parties were

unable to reach a resolution. Thereafter, Casino and FISIF submitted an answer to

Worker’s complaint. At that time, jurisdiction of the WCA was not contested. The

parties subsequently submitted a pretrial order approved by the WCJ, which

contained a stipulation that the “[j]urisdiction of [WCA] is not contested.” The

pretrial order listed Eileen Vialpando (Witness) as one of Worker’s potential

witnesses for trial. The WCJ heard Worker’s claim for medical and compensation

benefits and filed a memorandum opinion stating that Worker was entitled to such

benefits and directing the parties to file requested findings of fact and conclusions of

law.

{6} Eight days after the WCJ’s opinion was entered, on November 29, 2006, the

PPGC suspended the licenses that Worker and Witness required to perform their

employment duties. Employee and Witness were banned from the premises of the

Casino until further notice. On January 25, 2007, both Worker’s and Witness’s

licenses were permanently revoked by PPGC resulting in termination of their

employment with the Casino and the Pueblo.

{7} Meanwhile, the WCJ issued an order regarding attorney fees related to

worker’s injury claim. The WCJ found that Worker’s attorney was entitled to $6,500

3

plus gross receipts tax. This payment was to be paid equally by Worker and

Defendants.

{8} The WCJ later issued a compensation order memorializing his previous

memorandum opinion and including findings of fact and conclusions of law. The

WCJ found that the “[WCA] has jurisdiction over the parties” and that the accident

that led to Worker’s injury occurred in the course and scope of Worker’s employment

at the Casino. Based on these findings, the WCJ determined that Worker was entitled

to compensation in the amount of $38.50 per week for 115 weeks, for a total of

$4,427.50.

D. Worker’s Bad Faith/Retaliatory Discharge Claim

{9} On February 9, 2007, Worker and Witness submitted a joint complaint with

the WCA claiming that the Casino, the Pueblo, and FISIF had engaged in “Bad

Faith/Unfair Claims Processing” and “Retaliation” as a direct result of Worker having

filed his initial complaint with the WCA and Witness having participated in those

proceedings on Worker’s behalf. Worker and Witness further specified that their

November 29, 2006, suspensions and January 25, 2007, terminations were in

violation of Section 52-1-28.1, which prohibits unfair and bad faith claim-processing

practices, and Section 52-1-28.2, which prohibits retaliation against employees

seeking benefits. This new complaint was filed under the same WCA number as

Worker’s original complaint, and the matter proceeded accordingly.

{10} On April 13, 2007, Worker and Witness submitted an amended claim with the

WCA that was identical to their February 9, 2007, claim in all respects except that it

added PPGC as a defendant. Shortly thereafter, counsel from the Pojoaque Legal

Department submitted an “Entry of Special Appearance” requesting that “Employer”

be dismissed from the proceedings.

{11} The motion to dismiss advanced three arguments. The first was based on tribal

sovereign immunity. Defendants’ remaining arguments included the following:

Worker failed to exhaust his tribal remedies with respect to the revocation of his

license, and Worker failed to state a claim upon which relief could be granted in that

no cause of action existed for Worker to challenge PGI’s submission of materials to

PPGC relating to Worker’s suitability to engage in Class III gaming activities.

{12} Defendants then submitted a separate motion to dismiss all claims relating to

Witness. Defendants contended that because Section 52-1-28.1 penalizes employers

for improper claims filed only by injured workers and Section 52-1-28.2 prohibits

retaliatory discharge only against a worker seeking workers’ compensation benefits,

4

Witness was not entitled to relief under either provision. The WCJ granted the

motion and dismissed the claims raised by Witness on June 18, 2007.

{13} On June 4, 2007, the WCJ issued a ruling regarding PGI, PPGC, and FISIF’s

motion to dismiss for lack of subject matter jurisdiction. The WCJ first noted that

neither PGI, the Pueblo, nor FISIF had raised the issue of sovereign immunity prior

to the filing of the first motion to dismiss in April 2007. The WCJ remarked that

prior to the filing of that motion, PGI and FISIF had stipulated that “[j]urisdiction of

the [WCA] is not contested.” The WCJ also observed that neither PGI nor FISIF

raised sovereign immunity in their answer to Worker’s initial complaint. In light of

these facts, the WCJ concluded that “jurisdiction does exist at least as against [PGI].”

The WCJ then noted that PPGC was first added as a Defendant in the amended

complaint, after Worker’s original injury complaint had been adjudicated. Because

PPGC had not explicitly waived sovereign immunity, the WCJ held that PPGC was

entitled to raise that defense. Accordingly, the WCJ concluded that “the Motion to

Dismiss for Lack of Subject Matter Jurisdiction is denied as regards [PGI] but is

granted as regards [PPGC].”

{14} Defendants then submitted a motion requesting that the WCJ correct the

caption in the case. Counsel for Defendants argued that throughout the proceedings

the Worker’s employer had wrongly been identified as Pojoaque Pueblo and Cities

of Gold Casino. According to counsel for Defendants, PGI was the sole employer

during Worker’s employment at the Casino. Worker submitted a response,

expressing no objection to the addition of PGI as one of the named Defendants but

maintaining that the Casino, PPGC, and the Pueblo should all remain Defendants in

the case because, in his view, all of the named entities were his employer under the

Act.

{15} On August 14, 2007, in his findings of fact and conclusions of law, the WCJ

ruled that the employer in the case was PGI and that PGI had waived its sovereign

immunity by “its actions in voluntarily litigating in this case through a trial and entry

of a [c]ompensation [o]rder” and by “consenting to entry of the [p]re-[t]rial [o]rder

of October 12, 2006, which explicitly noted ‘[j]urisdiction of the [WCA] is not

contested.’” On the other hand, the WCJ concluded that because the Pueblo and

PPGC had not waived their sovereign immunity, claims against them were “barred.”

{16} The WCJ issued a memorandum opinion on February 29, 2008, in which the

WCJ restated that PPGC was never Worker’s employer and that PPGC was immune

from suit pursuant to its status as a tribal entity possessing sovereign immunity. With

respect to PGI, however, the WCJ again concluded that it had waived its sovereign

immunity by submitting to the jurisdiction of the WCA through participation in the

proceedings related to Worker’s injury claim. The WCJ further concluded that PGI

5

had provided material misinformation to PPGC that subsequently resulted in PPGC’s

terminating Worker’s license, which in turn led to the termination of Worker’s

employment with PGI. This chain of events, the WCJ concluded, directly resulted

from Worker’s having filed his initial claim with the WCA and constituted both bad

faith and retaliation by PGI. Accordingly, PGI’s actions were in violation of Section

52-1-28.1, and Worker was entitled to a 25 percent increase in his initial

compensation award. The WCJ further found that PGI, by retaliating against Worker,

acted in violation of Section 52-1-28.2 and, as such, the WCJ imposed a penalty

against PGI of $2,500 payable to the WCA pursuant to the remedy provisions in

Section 52-1-28.2(C) and (D). Finally, the WCJ concluded that despite the fact that

Section 52-1-28.2(B) explicitly requires employers who retaliate against employees

for seeking workers’ compensation benefits to rehire, the WCJ had no authority to

order PGI to do so. The WCJ explained that “[i]n order for [PGI] to rehire . . .

Worker, Worker must be appropriately licensed by [PPGC].” “The [WCA] cannot

require the [PPGC] to license Worker.” On April 1, 2008, the WCJ issued a

compensation order in which he restated the conclusions noted immediately above.

E. Attorney Fees

{17} After the WCJ issued his compensation order, Worker submitted proposed

findings of fact and conclusions of law with respect to attorney fees on the bad faith

and retaliation claims. Therein, Worker noted that he had previously been awarded

$6,500 in attorney fees as a result of the WCJ’s initial compensation order relating

to his workplace injury claim. Worker then pointed out that with respect to the bad

faith/retaliation claim alone, Worker had amassed $20,858.38 in attorney fees.

Accordingly, in addition to the $6,500 previously awarded, Worker requested an

award of $12,500 in attorney fees, for a total award equivalent to the maximum award

permitted under the Act of $19,000.1

{18} Worker then argued, assuming the WCJ was willing to grant his additional

attorney fees request, that the Act’s cap and its requirement of a 50-50 split of the fees

would be unjust and unconstitutional, pursuant to Mieras v. Dyncorp, 1996-NMCA-

095, 122 N.M. 401, 925 P.2d 518. The same day Worker submitted his attorney fees

request, the WCJ issued his order. The WCJ awarded Worker $12,500 as requested.

The WCJ took judicial notice of the chilling effect of miserly fees on representation

but found that the $12,500 award was reasonable and appropriate.

1

We note that Worker indicated that his additional fee request would result in a total

award of $19,500. Given that he had previously been awarded $6,500 and was requesting

an additional $12,500, Worker was requesting a total award of only $19,000. This

conclusion is consistent with the provisions set forth in NMSA 1978, 52-1-54(I) (2003),

which caps attorney fees at $19,000.

6

F. Worker’s Appeal

{19} Worker timely filed a notice of appeal with this Court. The notice referred

only to Worker; Witness was not mentioned. A docketing statement was filed with

this Court a month later. Within the docketing statement, Worker made several

arguments pertaining to the applicability of the WCA provisions to Witness.

II. DISCUSSION

{20} The parties contest five issues: (1) whether the provisions and remedies set

forth in Sections 52-1-28.1 and -28.2 are applicable to Witness, (2) whether the WCA

has subject matter jurisdiction to order Defendants to rehire Worker as required by

Section 52-1-28.2(B), (3) whether Worker’s failure to exhaust tribal remedies

precludes this Court from exercising its jurisdiction, (4) whether the remedies and

damages set forth in Sections 52-1-28.1 and -28.2(B) are adequate and constitutional,

and (5) whether the attorney fees cap provision in Section 52-1-54(I) is constitutional

in light of the provision requiring that the cost of any award be divided equally

between the employer and the employee.

A. Applicability of Provisions to Witness

{21} Although the applicability of Sections 52-1-28.1 and -28.2(B) to Witness is a

compelling question, we conclude that it is not properly before us. The procedural

rules governing appeals to this Court from the WCA are clear: “[a]ny party in

interest may, within thirty days of mailing of the final order of the workers’

compensation judge, file a notice of appeal with the court of appeals.” NMSA 1978,

§ 52-5-8(A) (1989). The WCJ dismissed Witness’s claims with prejudice on June 18,

2007. That order constituted a final order with respect to Witness’s claims. See Rule

1-054(B)(2) NMRA (“When multiple parties are involved, judgment may be entered

adjudicating all issues as to one or more, but fewer than all parties. Such judgment

shall be a final one unless the court, in its discretion, expressly provides otherwise

and a provision to that effect is contained in the judgment.”). Witness did not file a

notice of appeal within thirty days of that order. Although Worker’s notice of appeal

was timely filed, Witness was not named in the notice. “[T]ime and place

requirements for filing the notice of appeal are mandatory preconditions to the

exercise of appellate jurisdiction.” Williams v. Rio Rancho Pub. Schs., 2008-NMCA-

150, ¶ 15, 145 N.M. 214, 195 P.3d 879. We therefore decline to consider Witness’s

claims.

B. Whether the WCJ Has the Authority to Order Worker’s Employer to

Rehire Worker

7

1. Sovereign Immunity

{22} We review de novo the legal question of whether an Indian tribe, or an entity

under the tribe’s control, possesses sovereign immunity. See Gallegos v. Pueblo of

Tesuque, 2002-NMSC-012, ¶ 6, 132 N.M. 207, 46 P.3d 668. As previously noted,

there are several tribal-controlled entities involved in the ownership of the Casino.

As a federally recognized Indian tribe, the Pueblo undisputedly possesses sovereign

immunity. See Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58-59 (1978). PGI is

“a tribally chartered corporation” created by, but independent of, the Pueblo. PGI

was incorporated by the Pueblo under Section 17 of the Indian Reorganization Act

(IRA), 25 U.S.C. § 477 (1990). Corporations formed under Section 17 enjoy

sovereign immunity and may independently waive such protection. Sanchez v. Santa

Ana Golf Club, Inc., 2005-NMCA-003, ¶ 6, 136 N.M. 682, 104 P.3d 548 (filed 2004).

The PPGC and other gaming commissions like it are “strictly regulatory [entities that

conduct] oversight to ensure compliance with tribal, federal, and, if applicable, state

laws and regulations.” Kosiba v. Pueblo of San Juan, 2006-NMCA-057, ¶ 11, 139

N.M. 533, 135 P.3d 234 (internal quotation marks and citation omitted). As such, the

PPGC also possesses sovereign immunity, and that immunity may also be

independently waived. See id. Finally, BTDA is an unincorporated political

subdivision of the Pueblo and itself possesses sovereign immunity which it may

waive. See Ramey Constr. Co. v. Apache Tribe of Mescalaro Reservation, 673 F.2d

315, 320 (10th Cir. 1982) (holding that resort hotel complex was a sub-entity of the

tribe and thus entitled to sovereign immunity). Having discussed the various tribal

entities involved, we now address the implications of these findings with regard to

whether Worker is entitled to be rehired or, as the Defendants indicate, whether this

Court is precluded from enforcing the rehire provision of the Act because PPGC has

not waived its sovereign immunity.

{23} We begin by addressing Worker’s arguments that the WCJ did have authority

to require the Pueblo and the PPGC to rehire him. Worker first argues that this case

is analogous to Lucero v. City of Albuquerque, 2002-NMCA-034, ¶ 17,132 N.M. 1,

43 P.3d 352, wherein this Court rejected the city’s contention that a workers’

compensation judge lacked the authority to order the city to rehire a worker under

NMSA 1978, Section 52-1-50.1 (1990). That particular section of the Act requires

employers to rehire workers who have been injured as a consequence of their

employment if a position is available and if the injured worker is capable of fulfilling

the duties of that available position. Section 52-1-50.1(A). Worker analogizes the

present matter to Lucero because, like the City of Albuquerque in that case,

Defendants in the present matter contest the authority of the WCJ. We find Lucero

to be distinguishable.

8

{24} The issue in Lucero was whether a workers’ compensation judge had the

authority to enforce provisions of the Act where, due to lack of clarity in the Act

itself, the Act suggested that only the director of the WCA had the authority to

enforce the particular provisions at issue in that case and that the provisions could be

enforced only by way of a fine rather than by mandatory rehiring. 2002-NMCA-034,

¶¶ 18-20. Unlike Lucero, the issue in the present case is not who has the authority

to enforce a particular WCA provision or the means of enforcing that provision, but

whether the Act itself is applicable to the Pueblo or PPGC. Nowhere in Lucero did

the city of Albuquerque argue that the Act was inapplicable to it as an entity; it

merely disputed the manner in which the Act itself functioned.

{25} Worker’s second argument regarding the WCJ’s authority to order the Pueblo

and PPGC to rehire him is premised on Doe v. Santa Clara Pueblo, 2007-NMSC-

008, 141 N.M. 269, 154 P.3d 644. In Doe, our Supreme Court concluded, after a

lengthy and thoughtful discussion of the legislative history of the Indian Gaming

Regulatory Act (IGRA), that “state courts have jurisdiction over personal injury

actions filed against Pueblos arising from negligent acts alleged against casinos

owned and operated by the Pueblos and occurring on pueblo lands.” Id. ¶ 1. The

Court reached this conclusion by finding that “[n]othing in the language of IGRA

prohibits jurisdiction shifting.” Id. ¶ 13. The term “jurisdiction shifting,” the Court

explained, referred to the principle that, rather than “Congress allocating jurisdiction

between the tribes and states” in the IGRA, Congress thought it more appropriate to

permit the tribes and states themselves to negotiate jurisdictional questions given the

“diverse interests of tribes and states” with respect to gaming. Id. ¶¶ 31-33. Worker,

relying on this language, highlights that the Compact requires the Pueblo to possess

workers’ compensation insurance. Thus, Worker contends, in agreeing to carry

workers’ compensation insurance, the Pueblo, PPGC, and PGI have all agreed to

submit to the jurisdiction of the WCA to fully comply with the mandates of the

provisions set forth in the Act and have waived their sovereign immunity with respect

to the WCA’s enforcement of the Act. We find this argument unpersuasive.

{26} The compact language at the heart of Doe clearly delineated that with respect

to personal injury claims by visitors to the Santa Clara Pueblo gaming facilities, state

district courts had jurisdiction. Id. ¶ 8 (stating that “for the limited purpose of

personal injury actions involving visitor safety, the parties to the Compact agreed to

state court jurisdiction”). In contrast, the compact language at issue in this case

merely states that the Pueblo shall provide “to all employees of a gaming

establishment employment benefits, including, at a minimum . . . workers’

compensation insurance through participation in programs offering benefits at least

as favorable as those provided by comparable state programs.” Noticeably absent

from this language is any identification of where jurisdiction might lie when and if

a workers’ compensation claim is filed by an employee of PGI. Doe is thus

9

inapplicable. Ultimately, we understand Worker to contend that the Pueblo, PPGC,

and PGI have implicitly submitted themselves to the jurisdiction of the WCA by

virtue of having agreed to provide workers’ compensation insurance. This

proposition was previously addressed and rejected by this Court. See Sanchez,

2005-NMCA-003, ¶¶ 17-18 (“Plaintiff urges th[is] Court to hold that [the

d]efendant’s voluntary participation in New Mexico’s workers’ compensation

program serves as a waiver of immunity . . . [W]e conclude that waivers of sovereign

immunity cannot be created by implication through activities such as participation in

the state’s workers’ compensation program.”).

{27} Worker’s final argument seems simply an appeal to common sense:

[T]he Pueblo of Pojoaque can not [sic] assert sovereign immunity

and[/]or lack of subject matter jurisdiction with respect to some

provisions of the New Mexico Workers[’] Compensation Statute when

it both participated in extensive proceedings before the WCA and

purchased an insurance policy for workers[’] compensation benefits

filed at the WCA for its employees.

We disagree with the latter portion of Worker’s argument that the purchasing of a

workers’ compensation insurance policy implicitly requires a tribe or tribal entity to

surrender to state court jurisdiction. Our discussion of Sanchez and our conclusion

that voluntary participation in workers’ compensation does not act as a waiver of

sovereign immunity sufficiently disposes of this contention. However, there is merit

to Worker’s assertion that PGI, having submitted to the jurisdiction of the WCA and

complied with certain provisions of the WCA, cannot assert sovereign immunity with

respect to other portions of the Act.

{28} Throughout all of the proceedings, Defendants have consistently maintained

that the decision to suspend and revoke Worker’s gaming license was carried out by

PPGC and that PPGC had never, during the course of any proceedings with respect

to Worker, waived its sovereign immunity. We agree. The WCJ correctly found that

PPGC possesses sovereign immunity and never waived that immunity during the

proceedings before the WCA. However, we do not interpret this finding to conflict

with the conclusion that PGI has waived its sovereign immunity. As we noted above,

incorporated tribal entities are free to waive their immunity independent of the tribe

itself and the other tribal entities derived from that tribe. See Sanchez,

2005-NMCA-003, ¶ 6. Defendants explicitly note in their answer brief that

PGI Inc. chose [not to] raise the defense of sovereign immunity during

the initial WCA benefits hearing because the issue was

Worker/Appellant’s employment benefits. In contrast, the Pueblo of

10

Pojoaque and the PPGC raised sovereign immunity after the issue

became the regulatory and adjudicatory functions of the PPGC when

considering whether the Worker/Appellant’s conduct was suitable to

hold a Class III gaming license within the Pueblo of Pojoaque.

Having previously established that the immunity of tribal entities is possessed

independently by each entity, Defendant’s statement amply demonstrates that

although PPGC and the Pueblo are immune from suit in this matter, PGI waived its

sovereign immunity with respect to the adjudication of Worker’s claims.

Accordingly, although neither the WCA nor this Court may order PPGC to reissue

Worker his former employment license, we do not believe this precludes the WCJ

from ordering PGI to rehire Worker.

2. Rehire Provision

{29} Section 52-1-28.2(B) prohibits employers from engaging in retaliatory firings

and requires employers to rehire workers when they engage in such activity. The

language of that provision is as follows: “Any person who discharges a worker in

violation of Subsection A of this section shall rehire that worker pursuant to the

provisions of the Workers’ Compensation Act . . . and the New Mexico Occupational

Disease Disablement Law . . . provided the worker agrees to be rehired.” Id.

(emphasis added). The record reflects that the WCJ found that Worker was

discharged in violation of Section 52-1-28.2(A).

{30} As noted by our Supreme Court, by enacting Section 52-1-28.2(B), “the

[L]egislature expressly set out the clear mandate” that the act of retaliatory discharge

is a clear violation of public policy. Michaels v. Anglo Am. Auto Auctions, Inc., 117

N.M. 91, 92, 869 P.2d 279, 280 (1994). The remedy set forth by the Legislature for

a violation of this public policy is equally clear: mandatory rehiring. The language

in Section 52-1-28.2(B) specifically states that an employer who engages in

retaliatory discharge “shall rehire” that employee. The use of the word “shall”

imposes a mandatory, not discretionary, requirement. See NMSA 1978, § 12-2A-

4(A) (1997) (explaining that “‘[s]hall’ and ‘must’ express a duty, obligation,

requirement or condition precedent”). That the Legislature implemented a mandatory

remedy in this circumstance follows naturally from the fact that, as noted by the

Supreme Court of Hawaii, anti-retaliation provisions in workers’ compensation laws

are critical to the very solvency of workers’ compensation regimes.

The purpose of [the anti-retaliation] statute is to preserve the

integrity of the workers’ compensation law by protecting employees

from retaliatory discharges. If an employer could, with impunity,

coerce an employee into foregoing his rights, the employer would be

11

able to destroy the function of the law and circumvent an obligation

imposed upon him by the [L]egislature.

Puchert v. Agsalud, 677 P.2d 449, 457 (Haw. 1984).

{31} Given the mandatory language of Section 52-1-28.2(B), the seriousness of the

public policy at issue, and the conclusiveness of the finding by the WCJ that

Worker’s employment was terminated as a consequence of his filing a claim with the

WCA, this Court concludes that PGI must rehire Worker. As noted in our earlier

discussion of the principles of sovereign immunity, sovereign immunity does not

preclude this Court from issuing such an order to PGI. We are confident that Section

52-1-28.2(B) provides the WCJ with authority to require PGI to comply with such an

order because, as the Ohio court of appeals noted, “one may infer that the intent of

the [retaliatory discharge provision] is to return the employee to the same position as

he would have been had he not been discharged.” Mechling v. K-Mart Corp., 574

N.E.2d 557, 559 (Ohio Ct. App. 1989). As we previously stated, given the unique

facts presented in this matter, this requires PGI to provide Worker with a position of

employment that is substantially equivalent to the position he formerly held in terms

of pay and benefits. The WCJ concluded that he was prevented from ordering PGI

to rehire Worker, as is required under Section 52-1-28.2(B), because such an order

would require PPGC to reissue Worker a gaming license. On this record, we are in

no position to consider details such as this that might be involved in rehiring Worker.

We conclude only that, given PGI’s violation of Section 52-1-28.2(B), PGI must

rehire Worker in accordance with the mandatory provisions of that statute.

C. Exhaustion of Tribal Remedies

{32} The Pueblo and PPGC contend that given the “unique nature of licensing in

gaming,” this Court should adopt the exhaustion rule set forth in National Farmers

Union Insurance Cos. v. Crow Tribe of Indians, 471 U.S. 845 (1985). Having

already determined that the Pueblo and PPGC possess sovereign immunity which has

not been waived, we do not reach Defendants’ argument concerning exhaustion of

tribal remedies as it relates to gaming licenses.

D. Adequacy of The Bad Faith and Retaliatory Discharge Remedies

{33} Worker next argues that the damages available under the WCA for a worker

subjected to a retaliatory discharge and bad faith claim processing by an employer are

“grossly inadequate.” He asserts that this Court should interpret Section 52-1-28.2

to require Worker’s employer to pay Worker “all the lost wages the [Worker]

suffer[ed] as a result of the retaliatory discharge.” “Statutory interpretation is an issue

12

of law, which we review de novo.” State v. Duhon, 2005-NMCA-120, ¶ 10, 138

N.M. 466, 122 P.3d 50.

{34} In support of his argument, Worker relies heavily on Michaels, where our

Supreme Court instructed that the application of Section 52-1-28.2 should be liberally

construed and adopted the tort of retaliatory discharge as a remedy available

independent of the remedies provided under the Act, which are otherwise exclusive.

Michaels, 117 N.M. at 94, 869 P.2d at 282. Worker’s reliance on Michaels to support

his argument is misplaced. That case itself resulted in the expansion of available

remedies to a worker subjected to a retaliatory discharge by authorizing workers to

pursue a tort action for retaliatory discharge in the district courts. Id. The Court’s

recognition of the independent tort action was premised, in part, on the observation

that the harm caused by a retaliatory discharge includes much more than the mere loss

of employment.

A worker wrongfully discharged, even if eventually rehired, will incur

damages in the form of lost wages from the date of discharge to the

date of rehiring. If the issue is contested it could take up to a year or

more before he or she is reemployed. Additionally, if the employee

were to search for a new job, there would be the cost and

inconvenience of searching for a new job or moving costs. Awarding

civil damages not only vindicates the state’s interest in enforcing public

policy but also adequately redresses the harm to the individual

naturally flowing from the violation of public policy.

Id. at 93, 869 P.2d at 281. The above clearly demonstrates that Michaels provided

the remedies that Worker argues this Court should interpret Section 52-1-28.2 to

include by implication. Accordingly, we reject his request to interpret that section to

include remedies beyond those expressly provided in the Act.

E. Attorney Fee Cap

{35} Finally, Worker argues that the cap on attorney fees in Section 52-1-54(I) is

unconstitutional because Section 52-1-54(J) requires that these fees be borne both by

the worker and his employer equally. Worker asserts that “[i]t is immaterial whether

one uses the rational basis or intermediate scrutiny test[;] . . . no governmental interest

is served when a claimant who wins his case pays his attorney more money than he

wins and loses his job and the bad faith actor [e]mployer escapes virtually

unscathed.” We apply de novo review. See generally New Mexicans for Free Enter.

v. City of Santa Fe, 2006-NMCA-007, ¶ 45, 138 N.M. 785, 126 P.3d 1149 (“We

review constitutional challenges to a statute de novo.”).

13

{36} Worker acknowledges that our Supreme Court has previously addressed and

rejected challenges to the constitutionality of the fee limitations in Section 52-1-54(I).

See Wagner v. AGW Consultants, 2005-NMSC-016, ¶ 3, 137 N.M. 734, 114 P.3d

1050. Nevertheless, Worker requests that, rather than following the majority opinion

in Wagner, we instead adopt the dissenting opinion in which Justice Bosson argued

that the fee cap was unconstitutional even under intermediate level of scrutiny. Id.

¶ 36 (Bosson, J., concurring in part and dissenting in part). We have no authority to

do as Worker requests. See Alexander v. Delgado, 84 N.M. 717, 718, 507 P.2d 778,

779 (1973) (“[A] court lower in rank than the court which made the decision invoked

as a precedent cannot deviate therefrom and decide contrary to that precedent[.]”

(internal quotation marks and citation omitted)). While we acknowledge that

Worker’s challenge to both the fee splitting provision in Section 52-1-54(J) and the

attorney fees cap distinguishes his argument somewhat from that raised by the worker

in Wagner, we nonetheless conclude that the outcome in Wagner is controlling and

determinative. There, our Supreme Court observed that the worker had failed to

submit crucial evidence, including arguments that the fee cap provision

is an arbitrary and irrational means to achieve the [s]tate’s objectives.

For instance, there is no evidence in the record to suggest either what

percentage of claimants approach or reach the fee limitation at the

administrative level, or the typical amount of time expended by

attorneys either at the administrative level or on appeal . . . [or that the

amount specified in the fee cap provision] has been insufficient to

cover workers’ attorney fees at the administrative and appellate levels.

Wagner, 2005-NMSC-016, ¶ 28. Absent such evidence, the Wagner Court was

compelled to deny the constitutional challenge advanced in that case. Id. ¶¶ 29, 31.

Similarly, aside from his bare assertions that the fee splitting and fee cap provisions

render the attorney fees award provisions “unfair and unjust,” Worker has equally

failed to adequately explain how the fee splitting provision in connection with the

attorney fee cap is not rationally related to the purposes of the state’s objectives.

Accordingly, we reject Worker’s arguments.

III. CONCLUSION

{37} We hold that Section 52-1-28.2(B) provides the WCJ with authority to require

PGI to rehire Worker, and we reverse the WCJ’s findings to the extent they contradict

this conclusion. We affirm on the remainder of the issues presented on appeal.

{38} IT IS SO ORDERED.

___________________________________

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LINDA M. VANZI, Judge

WE CONCUR:

_________________________________

CYNTHIA A. FRY, Chief Judge

_________________________________

MICHAEL D. BUSTAMANTE, Judge

Topic Index for Martinez v. Cities of Gold Casino, No. 28,762

AE APPEAL AND ERROR

AE-RM Remand

EL EMPLOYMENT LAW

EL-TE Termination of Employment

GV GOVERNMENT

GV-SI Sovereign Immunity

IL INDIAN LAW

IL-GA Gaming

IL-TJ Tribal and State Authority and Jurisdiction

WC WORKERS COMPENSATION

WC-AF Attorney Fees

WC-RT Retaliation

WC-WG Workers’ Compensation, General

ST STATUTES

ST-IP Interpretation

15