It's a big week for NCAA college players.
The National Labor Relations Board (NLRB) ruled that a group of Northwestern college football players, led by quarterback Kain Colter, are employees and have the right to form a union and bargain collectively. The NLRB is a U.S. government agency that deals with labor law.
This matters because as a bargaining unit, players as a group can now start to ask for more - a lot more. Think about how baseball was changed when the players unionized and fought for their rights.
So this decision will potentially have a major impact on college sports and force the NCAA to change how it does business. For decades, the NCAA has offered scholarships in exchange for athletic services. However, the NLRB says that falls short, and with this ruling, threatens to tear down the very foundation of the NCAA and its billion dollar business model.
Control Control Control
In concluding that players were entitled to employee status, NLRB director Peter Ohr focused on the level of control that Northwestern exercised over its student athletes. That level of control, he said, moved players from being primarily students to being athletes that have earned the right to unionize. If they were primarily students, they couldn't unionize.
In ruling that Northwestern players were athletes first (and students second), he relied on a bunch of factors to demonstrate control over the players that no longer made them primarily students (like others on campus) and effectively turned them into employees. Here are a few of these factors:
(a) The NCAA limits athletic activities to 20 hours per week during the season and 8 hours during the offseason. Despite that, Northwestern players dedicated 50 to 60 hours a week on football during training camp, and another 40 to 50 hours a week during the football season. While the workouts that would take players beyond the 20 hour cap were deemed "voluntary", players knew if they didn't show up there would be serious consequences. Some days players had to engage in football related activities from 5:45am to 10:30pm. Devoting so many hours a week to football was a massive consideration for the NLRB. The players basically had a second job: football.
(b) Players allege they were steered away from certain courses because they conflicted with football. Colter wanted to go to medical school but was discouraged from taking a pre-med course because it conflicted with his football schedule. He ultimately ended up transferring to psychology.
(c) Players have to abide by restrictive social media policies, and can't refuse a 'friend' request on Facebook from a coach. They have to let the coach know the type of car they drive. As well, players are subject to alcohol and drug policies, as well as anti-gambling and anti-hazing policies. A violation of these policies can result in serious sanctions, including suspensions and revocation of scholarships.
(d) If a player wants to get a job off campus, he needs permission. He's required to live on campus while a freshman and sophomore. He also can't do interviews without the coach's approval.
(e) The player can't profit off his own likeness and image; that's reserved for the university and the NCAA.
(f) A player is prohibited from swearing in public, and if a player "embarrasses" the team, he can be suspended for one game. A second offense can result in a 1 year suspension. Players who transfer to another school to play football must sit out a year before they can compete for the new school.
(g) During the regular season, the players must wear a suit to home games.
(h) Players are required to remain within a six-hour radius of campus prior to football games.
These are just some of the factors that Ohr relied on when he concluded that the university was exercising a level of control that converted the students into employees.
Also important was that Northwestern was providing compensation in the form of scholarships in return for services that had nothing to do with academics.
All The Benchmarks of an Employment Relationship
So when it all shakes out, Ohr believed that this case had all the standard benchmarks of an employer/employee relationship, including controlling the employee's schedule, the discretion to hire, fire or suspend the employee and evidence of compensation.
What Do the Players Want
They want to negotiate limits on practice time and medical benefits. That's their starting point. They will probably also ask for a stipend to reflect cost of attendance. Remember that scholarships cover a lot – living expenses, tuition, room and board and book fees – but not everything.
At some point, players may ask to be paid. The NCAA is big business. The media deal for NCAA football is a $7.3 billion/10 year deal, while the March Madness deal is valued at $10.8 billion over 14 years.
Northwestern generated $235 million in revenue between 2003 and 2012 off things like ticket sales, television contracts, merchandise sales and licensing agreements. In 2012-2013 alone, the program generated $30.1 million in revenue, while spending about $5 million on scholarships. The university also says that its expenses add up to about $22 million all in for the football program.
In theory, the players as employees could also be entitled to disability insurance, workers' compensation and maybe even a pension. They could also be taxed on non-scholarship income they receive.
Next Steps: Appeal Central
As for next steps, the players will hold a vote to form a union, while Northwestern appeals the decision to the next level at the NLRB. If Northwestern is unsuccessful on appeal, they will probably refuse to bargain with the students and take the matter to federal court.
So we could still be years away from a final decision. That being said, this was a potentially historic win for the players and a step closer toward sharing in the billion dollar pie that is the NCAA.