Writers of Pro Football Prospectus 2008

27 Mar 2014

NLRB Rules In Favor of Northwestern Athletes

Is this the end of the murky "student-athlete" term? The real question is if this will hold up on appeal, but the NLRB believes that Northwestern athletes qualify as employees.

Posted by: Rivers McCown on 27 Mar 2014

29 comments, Last at 29 Mar 2014, 9:23pm by Will Allen

Comments

1
by tuluse :: Thu, 03/27/2014 - 11:21am

I'm mildly surprised and pleased by this ruling. Good on the athletes.

2
by MatMan :: Thu, 03/27/2014 - 11:52am

Yeah but let's honest here, the NLRB would probably find for unionizing the animals in the zoo.

3
by billsfan :: Thu, 03/27/2014 - 12:09pm

Interesting thing about this, to me, at least, is whether the NLRB would then have power to block the NCAA's attempts to sanction NW for anything related to the union's action, possibly even paying the players. This could get very ugly very quickly.

Also, good for the "students."

(I also like the Eagles)

4
by TomKelso :: Thu, 03/27/2014 - 2:14pm

The players had a rather clever point, as laid out by Colter on Mike and Mike this morning...

Golic went off on his usual spiel about how players are paid by their scholarships, which Colter acknowledged as the basis of their argument that they are already employees. Since this ruling applies only to relatively small number of what used to be called FBS schools that are private institutions (state employees having their unionization options set by the state they are in), it will be interesting to see what effect it has on recruiting.

Will "union schools" -- private institutions and state schools in generally bluer states -- have a recruiting advantage? It wouldn't take much for a canny recruiter to play it that way. Enough to push a, say, Maryland or Rutgers ahead of a Wisconsin or Nebraska? I can already hear the screaming down South if Vanderbilt starts getting better classes than Tennessee. Texas might implode if TCU actually starts out-hustling UT on a regular basis.

I would actually enjoy a lot of that if it happens.

5
by JonFrum :: Thu, 03/27/2014 - 2:58pm

Paying athletes to play football in college? I would never have dreamed of that idea. ;-)

6
by serutan :: Thu, 03/27/2014 - 3:38pm

It was pointed out on the Dan Patrick radio show that
there is a huge joker in this deck (ignoring appeal
outcomes, of course): Title 9.
______
Was wr

8
by ooter :: Fri, 03/28/2014 - 3:26am

How would Title IX be relevant?

9
by Alternator :: Fri, 03/28/2014 - 5:42am

I hereby offer a satisfactory settlement for Title IX:

Offer health insurance baseline to all players, and then any actual monetary compensation would be tied to the revenue generated by the team in question, using honest methods of counting sports income, such as counting booster donations brought in due to the sports teams.

I doubt many women's teams would actually get paid, but then, most non-football and non-basketball men's teams aren't going to get paid, either.

12
by BretU :: Fri, 03/28/2014 - 10:25am

Title IX only applies to educational opportunities. As the NLRB just ruled, football players are employees. I think legally this decision was wrong but if I'm Northwestern I run with it. Let football team unionize, equal opportunity no longer applies to football revenues. Dump all of women's sports and men's non-revenue sports. Collectively bargain to allow bonus stipends as part of player recruitment. Finally win the Big 10 for a couple of years because you get to "pay" incoming recruits to sign LOIs.

Of course with employment you fall into Title VII instead. If the football players really want to see a benefit to this, I highly recommend that they keeps their bargaining unit to be defined as football players only. Athletic department revenues are not high enough to support non-revenue sport leaches joining the bargaining unit.

13
by Will Allen :: Fri, 03/28/2014 - 10:36am

If Northwestern concedes that they are employees, then Northwestern's behavior under the collusive umbrella of the Big 10 and NCAA, is plainly violating antitrust law, just as they were when they, via the NCAA, attempted to form agreements with other schools which limited what was offered assistant coaches.

This action by the NLRB cannot be seen as apart from the pending antitrust lawsuits against the NCAA.

14
by BretU :: Fri, 03/28/2014 - 12:03pm

Nope. "Labor is not an article of commerce." Collective bargaining is exempt from antitrust laws under both the Clayton act and the Norris-La Guardia Act. Businesses can actually agree to anticompetitive agreements in the context of a collective bargaining agreement that if they tried to impose themselves would be per se violations of antitrust laws. If anything it completely insulate them from antitrust challenge.

15
by Will Allen :: Fri, 03/28/2014 - 1:06pm

The players for Northwestern have not yet actually formed a union, and they have not yet negotiated a CBA which permits the collusion. The reason why the NFLPA decertified twice was to be able to apply pressure, via antitrust law, on the NFL owners. It worked.

The players for Northwestern can, quite easily, simply decline to form a union, or decertify an existing union, and then sue on antitrust grounds, if Northwestern concedes that the players are employees.

16
by BretU :: Fri, 03/28/2014 - 2:48pm

The non-statutory antitrust exemption extends past the necessity of an active collective bargaining agreement and likely past the point of decertification. The last attempt in Brady v NFL did not focus on this, it instead convinced the court that a lockout is not a labor dispute. The 8th circuit of course reversed the trial courts finding that the lockout was not a labor dispute. Essentially, courts have been putting an end to using antitrust laws as a negotiating tactic in labor disputes. Northwestern does not need to concede anything, they just need to abide by the NLRB ruling. Ultimately it is in both the interests of the players in that it will allow them additional compensation and can be in the interests of Northwestern to gain a competitive edge in football recruiting. The NLRB ruling will create a host of problems for the players and probably for the school as well, but exposing Northwestern to antitrust liability is not one of them.

17
by Will Allen :: Fri, 03/28/2014 - 3:26pm

The reason why Reggie White became a free agent is because the non-statutory antitrust exemption ended when the NFLPA was decertified. Yes, the 8th circuit ruled as it did in Brady, but what the NCAA does much more closely resembles the old Rozelle Rule, which was not protected by exemption, way back in 1976, in Mackey, because it was not the result of an arms length labor negotiation.

This is all subject to the caveat, of course, that the entire body of antitrust and labor law jurisprudence is so intellectually incoherent and dishonest as to be wholly ridiculous. If he weren't dead, Curt Flood would be nodding his head vigorously in agreement.

18
by BretU :: Fri, 03/28/2014 - 4:29pm

Ok I think I now know what your point is. However, I don't think the NLRB decision does anything to make it more likely that Northwestern will have antitrust liability. Antitrust laws apply regardless of whether there is an employment relationship. Student athletes can already sue the NCAA or their school under antitrust laws as shown by te recent lawsuit initiated by Kessler from West Virginia and the University of Oklahoma case from years ago. I don't think it makes a lawsuit more viable because the NLRB allows players to form a union. That potential liability is hanging out there anyway.

19
by Will Allen :: Fri, 03/28/2014 - 5:36pm

Yeah, but the NCAA's, and its member schools', position on antitrust hinges upon a throwaway line in the U of OK decision, written by Stevens, which the NCAA dishonestly maintains gives them the power to treat athletes as some sort of special creatures which can have their compensation legally fixed by a cartel. Northwestern MUST fight this ruling by the NLRB, because to admit that these athletes have no such special designation, and are instead mere employees, means that the entire rationale for schools being able to legally enter into agreements, meant to limit what is offered for the next Johnny Football, to convince him to go to Northwestern, or Vanderbilt, or the University of Texas, is wholly baseless.

I wonder if the lawyers representing Northwestern's football players have had any communication with Kessler, even if through very informal back channels.

(edit) I'd also be shocked if the Big 10's bylaws, which, Northwestern has agreed to follow, doesn't include language which commits Northwestern to adhering to all NCAA regulations which pertain to what is offered an athlete. If Northwestern were to try to use their private school status, and the NLRB ruling, to offer stuff to athletes that the other Big 10 schools could not, there's a pretty good chance the other schools would sue Northwestern for breech of contract.

I think the cartel is going to be torn apart, and it is only a matter of how long it takes. The entire situation, of course, cries out for a legislative fix, which reconciles labor law, antitrust law, Title IX, and puts the athletes on a far more equitable footing with their coaches, athletic directors, and school presidents. What are the odds of the 537 hacks, who we elect to jobs on the Potomac, pulling that off?

20
by BretU :: Fri, 03/28/2014 - 8:10pm

I don't disagree in the slightest that the governing agreements between Northwestern and the Big 10 has language to that effect. But I can also tell you exactly who will win if the Big 10 sues Northwestern for breach of contract for bargaining with a unit deemed employees by the NLRB and if the players end up unionizing then federal law mandates that Northwestern bargain with the unit. I don't disagree that there are a ton of potential pitfalls for the players, the NCAA and Northwestern regardless of what corse of action they choose to think. I also agree that the current system is about to be torn apart. That said I think that the best course action is for Northwestern to run with it and get an early competitive advantage while the whole thing comes crashing down.

(Edit)
I also agree that this calls out for a legislative fix to address the conflicts created by the intersection of antitrust, labor, tax law, and civil rights. I am a bit more optimistic that when the whole thing falls apart Congress will step in and fix it. However, I think instead of balancing the interests and making a comprehensive fix, they will do the simplest thing and restore the previous status quo. Define student-athletes as not being employees, and no antitrust violation as long as revenue sports subsidize women sports through Title IX. Easier than coming up with new solution.

It has been pleasant discussing this with you on this btw.

21
by Will Allen :: Fri, 03/28/2014 - 8:29pm

If Congress, especially the Rand Paul wing of the Republican party, and the Congressional Black Baucus, sell out the athletes to the jackals in the NCAA and the major conferences, and their member schools, well, damn them to hell, even more than they already are.

22
by BretU :: Fri, 03/28/2014 - 10:19pm

I have a little more sympathy in that this is a difficult thing to balance. Want to compensate players? Probably means that this is taxable income, might even include the value of the scholarship like the IRS originally had it structured. This might actually put players in a worse position than they are currently considering the outrageous prices of tuition. Football programs make money but athletic departments overall do not. So goodbye women's collegiate athletics as we know it. What will this do to donations which generate double the revenues of the media deals, will donations drop if athletes get paid or if athletic scholarship donations are no longer tax deductible? University academics and professors will be afraid of anything that might result in lower funding for their programs. There is a lot of competing forces here and another thing is that Americans like college football regardless of labor/compensation issues and if the product on the field gets compromised constituents of congress will be demanding it be fixed and congress knows that the current system keeps their balls out of the fire.

23
by Will Allen :: Sat, 03/29/2014 - 2:39am

Oh, baloney. Any tax issue can be resolved via legislation. This is about middle-aged A-holes who like to pay themselves 7 figure annual incomes off the backs of young men who get colluded into accepting the equivalent of 100-200k, spread over 4-5 years.

28
by BretU :: Sat, 03/29/2014 - 6:52pm

The tax issue is probably one the easier to resolve, but that doesn't address a lot of the other problems I pointed out. The current system has football players subsidize the scholarships and expenses of thousands of women collegiate athletes. This process is celebrated and encouraged by legislators who might otherwise be sympathetic to the player's inadequate compensation. It will be very difficult for football players to get compensation they deserve without ending this subsidy. I think is very narrow and at the very least an incomplete viewpoint to see this simply as college coaches making a lot of money exploiting college football players.

29
by Will Allen :: Sat, 03/29/2014 - 9:23pm

Fine. Make it legal for the NCAA to fix head coaches' salaries, and ADs', at no higher than 500k a year, and assistant salaries no higher than 250k a year. Make these A-holes subject to the same limitations regarding outside income as the athletes. They can hand over their tax returns every year. If they find it too restrictive, tell'em there are 32 NFL teams they send a resume to.

24
by tuluse :: Sat, 03/29/2014 - 11:39am

Scholarships are already taxable income.

25
by BretU :: Sat, 03/29/2014 - 12:23pm

Athletic scholarships for degree candidate students are not taxable income. Different than the normal rule for scholarships as income.

26
by BretU :: Sat, 03/29/2014 - 12:24pm

Double post.

7
by ChrisS :: Thu, 03/27/2014 - 4:27pm

Unfortunately we will not know how this will end for quite some time. There are many layers of appeal that will be gone through before there is a final decision. I think Title 9 can be dealt with as long as the women are treated equitably, x% of each and every sports TV revenue goes to the direct benefit of the players. However, if the Women's Field Hockey team does not have a union how is the distribution of these benefits determined. What I am curious about is, if the employee designation sticks, can employment be divorced from enrollment.

10
by Mash Wilson :: Fri, 03/28/2014 - 9:49am

It can, and that's the elephant in the room.

11
by BretU :: Fri, 03/28/2014 - 10:22am

If that were enough to satisfy Title IX then it would have been done years ago. Schools that didn't want to fund women's sports would say that sports expenditures are tied to a % of the revenue generated by the sport. Obviously the DOJ would claim that is discriminatory.

27
by morganja :: Sat, 03/29/2014 - 6:45pm

Unfortunately, there is way too much money flowing to the corrupt state legislators and their associates for this to end up any different than it is now. Universities, especially their athletic programs, and the state DOT's are the primary vehicles for corruption and graft. No one is going to give that up.
For there to be change, it's going to require a political movement that threatens the status quo. That's not going to happen in the two party system. As long as the dominant party in each state shares the loot with the minority party, there is no incentive to rock the boat.
My prediction is that these hypocrites codify the status quo in new legislation and tell everyone to move on, nothing to see.