SHOULD STUDENT-ATHLETES BE CLASSIFIED AS EMPLOYEES?

By Iciss Tillis

Walter Byers, the first Executive Director of the National Collegiate Athletic Association (NCAA), played a pivotal role in shaping the modern landscape of college sports in the United States. Under his leadership, the NCAA grew from a small organization with limited power into a massive governing body that regulated college sports across the nation. Although he was instrumental in shaping various aspects of college sports, from eligibility rules to the enforcement of regulations, however, among Byers’ most significant contributions was the invention of the term “student-athlete” - a term that has had far-reaching implications for college sports and the legal rights of the athletes involved.

The term “student-athlete” was coined by Byers in the 1950s. He created this term in response to a legal challenge involving the widow of a college football player, Ray Dennison, who had died from a head injury sustained during a game. Dennison’s widow sought workers’ compensation benefits, claiming that her husband had essentially been an employee of the college while playing football.

Byers sought to counter this argument by emphasizing that college athletes were primarily students, not employees. The term “student-athlete” was thus born as a means to emphasize the educational focus of college sports and to distance it from the world of professional athletics.

The invention of the term “student-athlete” has had significant legal implications for college sports. By classifying college athletes as primarily students, universities and the NCAA have been able to avoid treating them as employees. This distinction has allowed the NCAA to maintain its amateurism model, which prohibits athletes from being paid for their athletic performance.

Over the years, there have been numerous legal challenges to this amateurism model, with plaintiffs arguing that college athletes should be entitled to compensation for their contributions to the multi-billion-dollar industry that college sports has become. The term “studentathlete”, however, has been a critical tool for the NCAA in defending its position.

In response to the George Floyd protests and the global embrace of social justice reform, on September 29, 2021, National Labor Relations Board (NLRB) General Counsel Jennifer Abruzzo issued General Counsel Memorandum 21-08 (GC Memo 21-08) titled “Statutory Rights of Players at Academic Institutions (Student-Athletes) Under the National Labor Relations Act.” In GC Memo 21-08, Abruzzo sets forth her prosecutorial position that studentathletes are statutory employees under the National Labor Relations Act (NLRA).

Notably, GC Memo 21-08 proscribes the use of the term “student-athlete” and replaces same with “Players At Academic Institutions,” concluding that misclassifying such employees as mere “student-athletes” and leading them to believe that they do not have statutory protections is a violation of Section8(a)(1) of the Act.

GC Memo 21-08 also extends the rights and protections under Section 7 of the Act to college athletes and provides a gateway for them to organize collectively. Lastly, GC Memo 21-08 puts an end to the issue as to whether public institutions, which are outside the reach of NLRB jurisdiction, can be subject to prosecution for unfair labor practices. According to Abruzzo, because Players at Academic Institutions perform services for, and are subject to the control of the NCAA, their athletic conference, and their college or university, she “will consider pursuing a joint employer theory of liability” where appropriate.

In Northwestern University1, 362 NLRB 1350 (2015), Peter Sung Ohr, then NLRB General Counsel, found that the football players receiving grant-in-aid scholarships were employees under the NLRA and ordered an election covering that bargaining unit. On appeal, the NLRB Board declined to exercise jurisdiction over the Northwestern football players and dismissed the petition due to the likelihood that labor instability would result from exercising jurisdiction over Northwestern, a private university, given most NCAA member institutions are public colleges and universities over which the Board cannot assert jurisdiction. While the NLRB’s decision did not address the issue as to whether student-athletes are employees, it did indicate concern over whether college athletes would even be able to collectively bargain given, the services they provide do not fit within any current NLRB analytical framework. In further support of its decision to decline exercising jurisdiction over the action, the NLRB further noted that varying state laws would cause bargaining to look different at public colleges and universities as opposed to private, in furtherance of labor instability.

1 362 NLRB 1350, 1356 (2015).

On January 31, 2017, then NLRB General Counsel Richard Griffin issued General Counsel Memorandum 17-01 (GC Memo 17-01) titled “General Counsel’s Report on the Statutory Rights of University Faculty and Students in the Unfair Labor Practice Context.” In GC Memo 17-01, Griffin asserted his prosecutorial view that “scholarship football players at Northwestern and other Division I FBS private colleges and universities are employees under the NLRA because they perform services for their colleges and the NCAA, subject to their control, in return for compensation.” Griffin further provided that scholarship football players at private institutions had NLRA Section 7 rights and protections, namely “advocat[ing] for greater protections against concussive head trauma and unsafe practice methods, reform[ing] NCAA rules so that football players can share in the profit derived from their talents, or self-organiz[ing], regardless of whether the Board ultimately certifies the bargaining unit.” Griffin declined to opine on the employee status of other collegiate athletes and instead limited his decision to D1 FBS scholarship football players at private NCAA member institutions. GC Memo 17-01 was rescinded but later reinstated by Abruzzo’s GC Memo 21-08.

In its unanimous decision in NCAA v. Alston2, the Supreme Court recognized that “college sports is a profitmaking enterprise” and rejected the NCAA’s antitrust defense grounded in semantics of “amateurism” in college athletics. In that case, the Court held that NCAA-imposed caps on education-related benefits for college athletes violated federal antitrust laws.3 Although the Court’s holding in Alston was only focused on caps on educationrelated benefits, the decision had vast implications for the future of college athletics, including the employment status of athletes’ under the NLRA.

Specifically, Justice Brett Kavanaugh, in his concurring opinion, further argued that the NCAA’s remaining compensation rules also violate antitrust laws and questioned whether the NCAA and its member institutions “can continue to justify not paying student athletes a fair share” of the billion of dollars in revenue they generate on an annual basis.4 Moreover, he highlighted the fact that “the student-athletes who generate the revenues, many of whom are African American and from lower-income backgrounds, end up with little or nothing.”5 Justice Kavanaugh then suggested that collective bargaining could be a solution.

Impact of General Counsel Memorandum 21-08

GC Memo 21-08 reinstated the theory expounded in GC Memo 17-08 – that the scholarship football players in Northwestern University satisfy both the broad statutory definition of employee under Section 2(3) and the common-law agency test, which defines an employee as a person “who perform[s] services for another and [is] subject to the other’s control or right to control.” In addition, GC 21-08 clarifies that the expansive language of the NLRA, as well as the NLRB’s holdings in Boston Medical Center6 and Columbia University, 7 support the notion that players at academic institutions are employees. A gray area still remains, however, regarding the status of players at academic institutions who participate in sports that are not revenue generating.

As aforementioned, Abruzzo views all references to continued on page 17...

3 NCAA rules limiting certain education-related compensation that schools may offer athletes, include rules that limit scholarships for graduate or vocational school, payments for academic tutoring, or paid post-eligibility internships, violate antitrust law.

4 Alston, 141 S. Ct. at 2068 (2021)(Kavanaugh, J. Concurring) the term “student-athletes” as misclassification under Section 8(a)(1), as the term is “leading them to believe that they do not have statutory protections” under the Act. Accordingly, Abruzzo declares that the General Counsel’s Office will pursue an independent violation of Section 8(a) (1) where any institution misclassifies players at academic institutions as student-athletes, holding institutions strictly liable for any violations.

5 Id.

6 330 NLRB 152, 160 (1999). In Boston Medical Center, the NLRB interpreted the statutory language and policies of the NLRA to include Players at Academic Institutions as employees.

2 141 S. Ct. 2141 (2021).

7 Columbia University, 364 NLRB No. 90 (August 23, 2016). In Columbia University, the NLRB reaffirmed its position that student assistants in colleges and universities are employees under the Act.

The NLRB’s decision to retire the term studentathlete and reclassify same as employees marks a significant shift in the world of collegiate sports. While this change may lead to better protections and benefits for student athletes, it also has the potential to create numerous challenges for educational institutions and the amateur sports model. As the legal landscape evolves, schools and student athletes alike must navigate this new reality and work collaboratively to find a balance that benefits all parties involved.