NLRB General Counsel Memo Announces Initiative to Treat College Athletes as Employees

October 7, 2021

On Sept. 29, 2021, the National Labor Relations Board (NLRB) general counsel issued General Counsel Memorandum GC 21-08, in which she announces that she believes certain college student-athletes are “employees” under the National Labor Relations Act (NLRA).

Memorandum GC 21-08 sets forth a new prosecutorial position that “certain Players at Academic Institutions” are employees under the NLRA; are entitled to exercise their Section 7 rights to self-organize, bargain collectively and engage in other concerted activities; and are protected under Section 8 from retaliation for and interference with exercising these rights. Under the GC’s new position, a private institution of higher education could violate the NLRA simply by leading student-athletes to believe they are not entitled to the NLRA’s protections. The memorandum directs the NLRB field offices to submit cases concerning the misclassification of “Players at Academic Institutions” to the NLRB’s Division of Advice for further direction on whether to issue a complaint.

The memorandum relies on the definition of employee in Section 2(3) of the NLRA as well as on the common-law agency doctrine for what constitutes an “employee” — a person “who perform[s] services for another and [is] subject to the other’s control or right of control.” According to the memorandum, scholarship football players at NCAA Division I Football Bowl Subdivision and other similarly situated players at private universities qualify as employees because:

  • The athletes play a sport (perform a service) that generates a large profit for the university and increases student applications and financial donations.
  • The athletes receive significant financial support in the form of tuition, fees, room, board, books and stipends covering additional expenses such as travel and childcare.
  • The NCAA controls many conditions of athletics (e.g., mandating maximum numbers of practice and competition hours, scholarship eligibility, limits on compensation and setting academic standards).
  • The schools control the means and manner of players’ work (e.g., enforcing minimum GPA requirements, penalizing players for infractions of sports-related rules, and maintaining detailed daily itineraries regarding the players’ activities and training).

The NLRB’s GC supports her new position with the U.S. Supreme Court’s recent decision in NCAA v. Alston; the NCAA’s updated name, image and likeness (NIL) rules; and student-athletes’ recent engagement in collective action on social justice issues. The memorandum relies heavily on Justice Brett Kavanaugh’s concurrence in Alston, questioning whether schools can “continue to justify not paying student-athletes a fair share” of their billions of dollars in revenue and suggesting that student-athletes “engage in collective bargaining.” Additionally, the NCAA suspended its NIL rules to allow student-athletes to profit from endorsements, autograph sales and public appearances. Finally, the memorandum asserts that student-athletes have been taking collective action on social justice issues, which directly concerns terms and conditions of employment and thus constitutes protected concerted activity.

Notably, the NLRB GC is responsible for the investigation and prosecution of unfair labor practices and for the general supervision of NLRB field offices in the processing of cases under the NLRA. She does not decide cases on the merits but decides which cases the NLRB field offices will prosecute.

This new policy raises several questions that will play out on college campuses. First, will the GC’s position lead to student-athletes being classified as employees under other federal labor and employment statutes such as the Fair Labor Standards Act (FLSA) or Title VII of the Civil Rights Act of 1964? Many of these statutes rely, at least in part, on the question of “the right to control” the worker in defining who is covered. Currently, these issues are being litigated in federal courts, but both the 7th and 9th U.S. Circuit Courts of Appeals have ruled that student-athletes are not employees of the NCAA or their athletic conferences for purposes of the FLSA.

Second, what schools and athletic conferences does this new policy cover? The NLRB’s jurisdiction covers only private employers, meaning that public schools would not be directly covered as employers. Some states include provisions in recently enacted NIL legislation that specifically prohibit college athletes from pay-for-play or specify that college athletes are not “employees.” Ultimately, however, these distinctions may not matter. The NLRB’s GC in a footnote explicitly warns that it may assert jurisdiction over the NCAA and an athletic conference, finding joint employer status with certain member institutions, including member institutions that are public schools.

As a result of the NLRB GC’s new interpretation, student-athletes likely will file unfair labor practice complaints that may take years to fully resolve. In the meantime, generally extending the status of “employee” to student-athletes may have other far-reaching consequences, including:

  • Affecting student-athletes’ eligibility for federal financial student aid.
  • Requiring international student-athletes on visas to confront complex issues raised by employment restrictions that may affect their status in the country.
  • Forcing schools to wrestle with Title IX obligations respecting the classification and treatment of female and male student-athletes as employees.

Academic institutions should prepare to address the vast ramifications of potential employment status on behalf of themselves and for their students.

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