NLRB General Counsel: College Athletes ARE Employees

Amidst several ongoing lawsuits where college athletes are asserting that they are employees of the universities they play at under the National Labor Relations Act, the National Labor Relations Board’s (“NLRB”) dropped a bombshell memorandum (Memorandum GC 21-08) on September 29, 2021 whereby it opined that college athletes ARE employees of their universities.[1] The memorandum was so groundbreaking that before I could even get this article drafted, Conduct Detrimental already had an article up covering it – "College Athletes are Employees," says NLRB, Potentially Clearing the Path for Unionization!

That being send, the implications of this memorandum are massive and wide-ranging, so I will cover a few additional areas that John Nucci did not address in his great article (which you should also read) and get into the weeds a little more.

Although footnotes are typically reserved for citations, clarifying information, and minor explanations, Jennifer A. Abruzzo, General Counsel for the NLRB used the first footnote of Memorandum GC 21-08 – Statutory Rights of Players at Academic Institutions (Student-Athletes) Under the National Labor Relations Act to take a shot across the bow at the National Collegiate Athletic Association (“NCAA”). Ms. Abruzzo refused to use the term “student-athletes” in her memorandum because of the NCAA’s history of using the term to further its narrative that college athletes are not employees entitled to protections provided for by the National Labor Relations Act (“NLRA”) and related laws.

Clearly, this memorandum is meant to stand in direct opposition to the NCAA’s stance on college athletes as employees generally and its strategy in recent lawsuits on this issue. While not binding, this memorandum will no doubt be used extensively by plaintiffs and the courts alike to push back on the NCAA’s employment arguments. Just as Alston struck a major blow on the NCAA’s amateurism argument as a sort of catch-all reason why college athletes should not be paid, it seems as though this memorandum may be a death knell for the student-athlete argument against employment.

Also of importance is the fact that Ms. Abruzzo made a point to explicitly reinstate Memorandum GC 17-01 – General Counsel’s Report on the Statutory Rights of University Faculty and Students in the Unfair Labor Practice Context to the extent it is consistent with the new memorandum. By doing so, Ms. Abruzzo has expanded the reach and depth of the most recent memorandum to also include the findings and opinions of the prior memorandum. Going forward, the two memoranda should be used in conjunction to further the argument that college athletes are employees.

Ms. Abruzzo noted specifically that the definition of “employee” is broadly defined and meant to capture the widest possible range of workers “subject only to a few, enumerated exceptions[,] . . . [which] do not include university employees, football players, or students.” One possible consequence of this decision is that the NCAA may now begin to lobby for the legislature to include college athletes under the exceptions to the definition of “employee” under Section 2(3) of the NLRA. Given the shifting tide of public opinion on college athlete compensation, the success of any such lobbying efforts is unlikely. But if the effort were to succeed, the NCAA would have a significant legal and legislative advantage comparable only to Major League Baseball’s anti-trust exemption.

Throughout the memorandum, Ms. Abruzzo references scholarship athletes as being entitled to protections as employees of their respective institutions. What does this mean for walk-ons and non-scholarship athletes? Could this lead to a situation where some athletes are employees while some of their teammates are not? In referencing common-law agency rules governing the employer-employee relationship to opine that college athletes are employees, the memorandum notes finding that a person performs services for another else subject to the control or right of control of another – this element is true of any athlete at a university, whether scholarship or not; however, the non-scholarship athletes are not compensated, which is a key element of the employer-employee relationship. A future issue to be determined in lawsuits against the NCAA might be this very point.

Finally, in another footnote, Ms. Abruzzo notes that there may be circumstances where a joint employer theory of liability is warranted since the NCAA and its conferences exercise certain control over college athletes, who also perform services for the NCAA and its conferences by playing sports, just as the athlete’s own institution does. This assertion guarantees that the NCAA will not be able to insulate itself by pushing NLRA responsibilities down to individual member institutions. As conference realignment is ramping up in college football, might this memorandum presage a further shift in how the NCAA, its conferences, and member institutions decide to structure their relationships?

This memorandum strikes a huge blow against the NCAA, but don’t expect it to stop fighting any time soon. As college athletes gain more privileges and protections, the NCAA will shift its strategy to limiting those privileges and protections, rather than outright prohibiting them (as has been the NCAA’s strategy in the past).

[1] The memorandum can be read in full on the National Labor Relations Board’s website: https://www.nlrb.gov/guidance/memos-research/general-counsel-memos.