Judge: NCAA Student Athletes Are Not Employees
A federal court ruling comes on the heels of the
NLRB's decision to decline jurisdiction in a case brought by college athletes
seeking the right to organize and join labor unions.
This article was published in the February 29, 2016, issue
of the National Law Review | See follow-up article, "Reigniting the
Debate Over Student Athletes as Employees"
The month of March is synonymous with spring, new
beginnings, and St. Patrick’s Day. In the world of sports, it’s synonymous with
March Madness: the three-week period where student athletes from sixty-eight
different Universities across the nation compete to be crowned champion of the
National Collegiate Athletic Association’s (NCAA) basketball tournament. Last
year’s tournament brought the NCAA its highest
average viewership in 22 years and business is expected to carry on as usual
in a few weeks. Heading into its marquee event, the NCAA won a victory off the
court as a result of District Court Judge William T. Lawrence’s recent
dismissal of a lawsuit brought by former University of Pennsylvania
student athletes against the NCAA.
The three plaintiffs in the case were former members of
the women’s track and field team at the University of Pennsylvania (Penn).
Plaintiffs’ complaint alleged that during the time they participated on the Penn
team as student athletes, they were employees under the Fair Labor Standards Act
(FLSA). Plaintiffs based their argument on a 2010 Department of Labor (DOL)
fact sheet put out by the DOL to help determine whether interns are
employees within the Act. Plaintiffs argued that all of the factors which tend
to establish an unpaid internship on the fact sheet are glaringly absent in the
case of student athletes, and therefore, their athletic endeavors performed for
the financial benefit of their universities were done neither as interns, nor
student athletes, but as employees.
So why does the label matter?
The answer to that is simple. If plaintiffs were
employees under the FLSA, they were entitled to be paid at least the minimum
wage and compensated at the overtime rate for hours worked over forty in a
workweek. Moreover, if the court were to determine that the three lead
plaintiffs were employees, then so too were the thousands of other student
athletes across the nation from 2012 to the present whom the plaintiffs sought
to eventually include in their class action lawsuit. Take a second and calculate
the number of athletes in the last four years across the various different NCAA
sports multiplied by the unpaid straight-time and overtime wages and you can see
why the NCAA was breaking a sweat worse than
Dick Vitale before a Duke-North Carolina game.
Per Judge Lawrence, the “FLSA defines ‘employee’ in a
circular fashion, as ‘any individual employed by an employer.’ “Employ,’ in
turn, is defined by the Act as ‘to suffer or permit to work.’” Because the
FLSA’s definitions are of little to no help, Courts routinely examine the
“economic realities” of the relationship reviewing several different factors in
order to determine whether an individual is an employee under the Act.
Even though plaintiffs argued the factors listed on the intern fact sheet
established their standing as employees, Judge Lawrence explained “there is not
even one set of immutable factors that applies to all interns in all situations,
and there is certainly not one test that applies equally to interns and student
athletes.” Instead, the Court determined a flexible support considering the
totality of the circumstances should be used.
Unfortunately for plaintiffs, the circumstances
indicated that they were not employees. Judge Lawrence supported his “finding
that student athletes are not employees … [by] the fact that the existence of
thousands of unpaid college athletes on college campuses each years is not a
secret, and yet the Department of Labor has not taken any action to apply the FLSA to them.”
This decision marks another setback for current and
former student athletes’ attempts to gain recognition as employees. Six months
ago, the National Labor Relations Board (NLRB)
declined jurisdiction over a case brought by Northwestern football players
seeking the right to organize and join labor unions. Although the NLRB punted on
the substantive question, it effectively closed the door on the case as the
NLRB’s decision is not subject to appeal.
The case is Gillian Berger, et al. v. National
College Athletic Association, et al. in the United States District Court for
the Southern District of Indiana, Case No. 1:14-cv-1710-WTL-MJD.