A National Labor Relations Board Regional Director issued a potentially monumental decision on March 26, when he granted certain Northwestern University football players the right to unionize. These football players had formed a labor group called the “College Athletes Players Association” and sought to bargain collectively with Northwestern over their playing conditions.
This NLRB Regional Director stunned many when he ruled in the athletes’ favor, tentatively granting them the right to vote on whether to accept CAPA as their union representative. The Regional Director found that the athletes overcame their key legal hurdle by proving that they were “employees” rather than “students.” He reasoned that: (i) Northwestern football generated hundreds of millions of dollars for the University; (ii) Northwestern brought these athletes to campus primarily to play football, not to attend classes; (iii) Northwestern exercised substantial control over the athletes, including by setting strict schedules and holding them to detailed rules governing their conduct off the football field; and (iv) Northwestern gave the athletes major benefits, including tuition, room, board, football tickets, and living stipends.
This is a major first step for the athletes to potentially obtain union representation. Northwestern has already indicated it will appeal, and it could take years for the full NLRB and then appeals courts to resolve the issue. This decision could be vulnerable because it upsets the status quo; however, the decision has legal and factual support, and appeals courts generally defer to the NLRB on these types of representation issues. Altogether, while the athletes have not yet crossed the finish line, they have scored a key victory and potentially shifted the momentum against Northwestern. For now, here are four takeaways for employers and college sports fans from this decision:
1. If this decision stands on appeal, it could fundamentally change college sports and potentially eliminate the NCAA as it currently exists.
If the decision does stand, it could fundamentally change college sports. Most college athletes support the idea of unionizing, so unionization could catch on quickly at other private schools. If the athletes ultimately obtained union representation, they would gain leverage to bargain for new benefits and changes to their playing conditions, subject to the NCAA’s rules.
It is possible; however, that unionization could ultimately change or completely eliminate the current NCAA system. Union-represented athletes could push their schools to simply leave the NCAA, or the NCAA could substantially relax its rules in an attempt to compromise with the athletes and avoid overturning the current system. It is even possible that the unionized schools themselves could decide to leave the NCAA, in order to further enjoy the recruiting advantages that their unionized status could create. Ultimately, this potentially could create a situation where colleges effectively form two new leagues for major sports: a “Tier 1” league consisting of unionized schools and schools providing similar benefits, and a “Tier 2” league that more closely resembles today’s NCAA. Although this is all speculative right now, this decision will almost certainly change college sports in major ways if it survives appeal. There also would be other significant, but difficult-to-predict ramifications, such as how this impacts Title IX, and whether some less-popular college sports survive if schools must begin allocating more resources to major sports.
2. The NLRB will continue expanding union membership.
This case also has a major impact outside college sports, as it could further assist unions attempting to organize other historically non-union workforces. In holding for the athletes, the Regional Director applied at least two concepts that should help unions in other organizing efforts.
First, the Regional Director defined the concepts of “employee” and “compensation” very broadly, and reiterated that the NLRB is willing to eschew traditional norms that may preclude unionization. Most experts believed the athletes had little chance of prevailing here, because the tuition and living expenses they received did not constitute true “compensation.” This NLRB Regional Director disagreed, noting that the athletes received myriad non-monetary benefits, and relying heavily on the fact that Northwestern exercised strict control over the athletes. This reasoning could extend to other workforces in similar situations. For example, organizations that rely heavily on unpaid interns for indefinite periods of time should exercise caution. The decision is another reminder that federal law makes it difficult for employers to lawfully accept free labor, except in narrow circumstances.
Second, the NLRB’s new “micro-organizing” rules played a key role in the athletes’ victory. In 2011, the NLRB issued new rules that helped unions exclude from their organizing efforts employees likely to vote against them or otherwise reduce their chances of prevailing. Here, CAPA relied on this doctrine to organize only Northwestern’s scholarship football players, and exclude the “walk-on” players, who were far less likely to constitute employees and could have tainted the scholarship athletes’ bid. The NLRB Regional Director accepted CAPA’s position, providing a textbook example of how unions can utilize this doctrine to organize new workforces. Unions will take this as another lesson for how they can “get their foot in the door” at previously unorganized workforces.
3. Colleges with graduate students are somewhat safe, for now
Another surprising aspect of this decision is that the Regional Director declined to change the rules on graduate students or otherwise grant them organizing rights under federal labor law. As Northwestern opposed the athletes’ bid, it relied heavily on NLRB precedent excluding graduate students from organizing protections. Many experts believed that, if the NLRB held for the athletes, it would also overrule this authority and grant graduate students the right to unionize.
Surprisingly, the Regional Director declined to do so. Instead, he distinguished graduate students from scholarship college athletes, largely because graduate students’ ‘compensation’ requires them to perform academic-related tasks that further their own education (e.g., teaching undergrads), whereas athletes’ time playing sports does not necessarily have the same effect. So, for now, the NLRB’s rules will remain the same for graduate students, although they could change at any time.
4. Unions scored a major victory regardless of what happens.
Perhaps the key takeaway is that, no matter what happens on appeal, unions scored a major win here. Even if federal courts overturn this ruling, it will give unions a major shot in the arm from a morale and public relations perspective. As unions continue working to organize new groups of employees, they will point to Northwestern’s athletes as role models, and examples of individuals who purportedly reaped benefits by banding together and supporting labor unions. The legal proceedings surrounding this case will likely remain in the public eye for years, and as news outlets continue to cover it, they will be giving unions free publicity.
If the athletes do prevail on appeal, unions will receive a major financial benefit as well. Professional athletes’ unions bring in tens of millions in revenue each year, and a union representing major college athletes could recover a large fraction of that income. That union would then ‘reinvest’ this income by supporting other organizing efforts and new labor movements, just as the United Steelworkers of America did when it supported the athletes here, and just as the SEIU has done by supporting the recent “Black Friday” and “Fight for $15” movements.
Altogether, this decision shows that unions still play a major role in almost all sectors of the U.S. economy, and can organize non-union workforces surprisingly fast. At a time when many mistakenly believe unions are losing clout, this serves as another reminder that employers must continue taking them seriously.