Student athletes as employees?

• Author: Mans, Lori K.
• Position: Labor and Employment Law

The first American intercollegiate sporting event took place in 1852 when rowing teams from Yale and Harvard went head-to-head in Lake Winnipesaukee, New Hampshire. Since those humble beginnings, college sports teams in the U.S. have, in many instances, become the personas of the academic institutions they represent. As succinctly explained by James J. Duderstadt, the former president of the University of Michigan, "Nine of 10 people don't understand what you are saying when you talk about research universities. But you say 'Michigan' and they understand those striped helmets running under the banner." (1)

Since the inception of formal college athletics in the 19th century, student athletes have not been considered employees of the institutions for which they play. For example, the National Collegiate Athletics Association (NCAA), which was founded in 1905 for the purpose of regulating amateur college sports in the U.S., has long viewed college athletes as students, not employees. (2) Accordingly, at least with respect to their student athletes, universities have not had to concern themselves with compliance under the National Labor Relations Act or the myriad of U.S. employment laws. But this may change, along with the entire landscape of collegiate athletics.

The Northwestern University Representation Petition

On January 28, 2014, the then recently formed College Athletes Players Association filed a petition with the National Labor Relations Board (NLRB or the board) seeking recognition as the union representative for scholarship recipients playing on Northwestern University's football team. The petition was opposed by the university because the National Labor Relations Act (NLRA or the act) only applies to employees. (3) Thus, the issue in the case was whether football players receiving scholarships were considered employees for purposes of organizing under the act. Peter Sung Ohr, the regional director of the board's Chicago region, answered that question in the affirmative on March 26, 2014, holding that Northwestern University scholarship football players are indeed employees. An explanation of the facts of the case and the regional director's decision are summarized below.

The Northwestern University Football Program

In reaching his decision, the regional director devoted significant attention to the profitability of Northwestern's football program. The football team produces revenue for the university through ticket sales, television broadcast contracts, and the sale of football merchandise. (4) The football team generated total revenue of $235 million, along with expenses of $159 million, for the years 2003-2012. The football program generated $30.1 million in revenue and $21.7 million in expenses for the 2012-13 year. (5)

Northwestern University expends a great deal of effort recruiting its scholarship football players. Once a particular player has been identified as having the desired football skills and abilities, the university vets the recruit's high school transcript, standardized test scores, and other information to determine whether the recruit can be preapproved for admission to the school. If pre-approved, the recruit receives a formal tender offer from the school, which must be executed by the recruit to become effective. The tender sets forth the specific terms and conditions of the scholarship. For example, the tender explains that the scholarship may be canceled if the player renders himself ineligible to play football or if he withdraws from the football team for any reason. To be eligible to play on the team, the player must be enrolled as a full-time student; be making adequate progress toward obtaining a degree; and maintain a certain grade point average.

The Northwestern University football team consists of about 112 players. Of those, 85 players receive grant-in-aid scholarships that pay for the recipients' tuition, fees, books, room, and board. The total value of the grant-in-aid scholarships per player is about $61,000 per year or approximately $76,000 per year if a player also takes optional summer classes. Players can also receive additional student assistance funds for things like health insurance and other expenses. In the past, the NCAA restricted schools to offering only one-year scholarships to athletes. However, effective the 2012-13 academic year, the NCAA loosened its rules to allow four-year scholarships to players. Northwestern University immediately began offering four-year scholarships with an option of a fifth year if the player "redshirts" his freshmen year.

The football season begins with a month-long training camp beginning in August. During the training camp, the players typically begin their day at 6:30 a.m. and end at approximately 10:30 p.m. Their days during training camp are spent in various types of rehabilitation and athletic training activities, practice on the field, meetings, and participation in team meals. The players spend upward of 50 to 60 hours per week on football activities during the training camp.

Once the training camp is complete, the football season begins. The regular season is comprised of 12 games against other colleges and...