Earlier this month, the General Counsel of the National Labor Relations Board issued a memorandum declaring that private college athletes should be considered “employees” under Section 2(3) of the National Labor Relations Act and are entitled to Section 8(a)(1)’s statutory protections. In making her determination, General Counsel Jennifer Abruzzo relied on the statutory and common law definitions of employee and looked to the Supreme Court’s recent rationale in NCAA v. Alston to support her conclusion. The implications of this memorandum are wide-ranging and will add even more tumult in a year that has already revolutionized college sports.

On September 29, 2021, the National Labor Relations Board’s (NLRB) General Counsel (GC), Jennifer Abruzzo, issued a memorandum reinstating GC 17-01—the 2017 memorandum discussing representation issues and the statutory rights of university faculty and students under the National Labor Relations Act (NLRA)—and declared that “student-athletes” 1 (hereinafter college-athletes) are employees that are entitled to statutory protections under Section 8(a) of the NLRA.

GC Abruzzo relied heavily on the expansive definition of the term “employee” used in both Boston Medical Center Corp. and Columbia University. According to the GC, the definition of “employee” in Section 2(3) of the NLRA is broad and expansive, including “any employee,” with only a few enumerated exceptions. University employees, football players, and students are not included in the NLRA’s list of exceptions.

The GC then turned to common law agency rules involving the employer-employee relationship to further support her conclusion that student-athletes are employees. Common law defines an employee as someone “who perform[s] services for another and [is] strongly indicative of employee status.” “Payment,” is also a strong indicator of whether a person is an employee. The GC then applied the common law definition to the actual experiences of college athletes. For example, the GC noted that college athletes (1) provide a service and generate millions of dollars for their universities, (2) receive substantial compensation in the form of tuition, fees, room and board, books, and stipends, (3) the NCAA controls the athletes’ terms and conditions of employment, such as setting limits on practice and competition time, scholarship eligibility, and limits on compensation, and (4) universities control almost every facet of the athletes’ daily lives.

In addition to looking to the plain language of Section 2(3) and common law, the GC relied upon both the majority opinion and Justice Kavanaugh’s concurrence in NCAA v. Alston (see our analysis of the Alston Opinion here) to support her conclusion. She noted that the Supreme Court justified its decision, in part, by looking to the profit-making aspect of college sports. And she pointed to Justice Kavanaugh’s concurrence, which noted that collective-bargaining may be an effective solution to the problem on whether to and how much to compensate players. Finally, the GC discussed the NCAA’s recent decision to allow college athletes to profit from their name, image, and likeness and noted athletes’ recent activism on social and political issues. In the GC’s eyes, college athletes are similar to professional athletes because they are both employed to play a sport and can simultaneously pursue external business ventures to grow their brands and generate income.

In some ways, the GC’s memorandum is nothing new: it reinstated a position taken in early 2017 (subsequently withdrawn in 2018) that college athletes receiving athletics scholarships are “employees” for purposes of the NLRA. However, the GC also ploughed new ground. The GC asserted a prosecutorial position that universities that misclassify athletes as “student athletes” rather than employees commit unfair labor practices under 8(a)(1) of the Act. The GC also suggested that the NCAA and/or athletics conferences may qualify as employers of student athletes at multiple institutions under the “joint employer” doctrine. That position is an apparent effort to address the stumbling block that caused the Board to decline jurisdiction over scholarship football players in the 2015 Northwestern University case on policy grounds: the Board’s jurisdiction extends only to private universities, not publics, so assertion of Board jurisdiction would be unmanageable and “not promote stability in labor relations.” See 362 NLRB No. 167.

Implications

GC Abruzzo makes it clear that in her prosecutorial role, she will attempt to expand the statutory term “employee” by issuing complaints and bringing unfair labor practice charges before the Board.

Her position will likely continue to ease the path for college athletes—and other students—to unionize and collectively bargain. It remains to be seen whether and to what extent classifying college athletes as “employees” under the NLRA would impact their classification as employees under other statutes and schemes, such as workers’ compensation and state and federal anti-discrimination laws. In particular, we will watch closely how the GC’s position impacts pending Fair Labor Standards Act litigation, including Johnson v. NCAA, where the court held recently that the plaintiffs had plausibly alleged that they were employees under the Fair Labor Standards Act (FLSA).

This development is one of several that alters the landscape with respect to college sports. Going forward, we recommend that colleges and universities closely follow developments in this area and, more specifically, contemplate their positions and responses to efforts by athletes and others to organize on campus. We invite college administrators interested in learning about this memorandum’s ramifications as well as other collegiate sports legal issues to contact our sports and employment law teams.