The Chicago Regional Office of the National Labor Relations Board (“Region”) waved its magic wand over the Northwestern University (“Northwestern”) scholarship football players and turned them into “employees” following a series of headline-generating hearings. See Northwestern University v. College Athletes Players Ass’n, Case 13-RC-121359, 2014 NLRB Reg. Dir. Dec. LEXIS 46 (NLRB Reg. Dir. Dec. March 26, 2014). This decision is significant because “employees” under the National Labor Relations Act have the right to engage in protected concerted activities, including forming a union.
The Region’s 24-page decision (“Decision”) focuses heavily on the facts of the case, detailing the degree of control Northwestern exerts over the athletic and personal lives of the players, the use of performance-based scholarship money, and the revenue generated by the program. The legal analysis kicks off with the definition of “employee” which generally means “a person who performs services for another under a contract of hire, subject to the other’s control or right of control, and in return for payment.” The Region was persuaded on each of these points that scholarship players, in contrast to walk-ons, were “employees.”
First, the Region was persuaded that the use of tender offer letters, the use of scholarship money and other benefits, and the threat of losing that money due to poor performance create workers performing services for hire.
Second, the Region hyper-focused on the amount of control the school exerts over the players. The Decision depicts a team that controls every single detail of players’ lives. The Region was convinced of the school’s year-round control over athletes based on training camps, meetings, practice, film sessions, workouts, strict rules of conduct, and daily itineraries controlling all aspects of the players’ lives. The Region pointed to the school’s control over athletes’ personal lives including students’ obligations to ask permission before making living arrangements, applying for outside employment, driving personal vehicles, going off campus, and more. The Decision even includes stories about the key union supporter on the team, none other than quarterback and scholarship recipient Kain Colter. One tale involved an alleged incident where Colter wanted to enroll in a specific pre-med class and due to its conflict with practice, had to take the class in the summer; this delay put Colter behind academically and he was forced to abandon pre-med as a major.
Following this analysis, the Region distinguished this case from the 2004 Brown University case in which the National Labor Relations Board (“Board”) found graduate students were not employees. See Brown University, 342 N.L.R.B. 483 (2004). In that case, the graduate students were considered primarily students and spent most of their time on their academics and being students. The students’ teaching and research duties were core elements of their graduate requirements, as proven by the fact that academic faculty supervised the work. The pay was not pay for services, but was financial aid to attend the school. The Decision details all the reasons why football players are actually performing a specific job for pay, unrelated to academics.
So, is this case a big deal? Despite its media attention, the impact of this case is limited to only private schools with scholarship programs. The case has already been appealed to the five-member Board and could thereafter make its way into federal court. For now, private sector non-education employers should take heed of the lengths the Board will go to in order to make itself relevant, make headlines, and generate business. Private schools with scholarship programs should understand this case and the factors relied on by the Region to reach its decision, and if this ruling stands, restructure their programs to try to avoid this result.
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