The National Labor Relations Board (“NLRB” or “Board”) has ruled in a unanimous decision that it is dismissing the petition filed by the College Athlete Players Association for an election declaring Northwestern University football team members who receive grant-in-aid scholarships are “employees” within the meaning of the National Labor Relations Act (“Act”).  The Board explained that it had concluded that “asserting jurisdiction in this case would not promote stability in labor relations.”  The Board made clear however that it might well assert jurisdiction in a future case involving grant-in-aid scholarship players.

The Players Association’s Petition

It has been over a year (March 26, 2014) since the Regional Director of the Chicago Region of the NLRB found that football players at Northwestern University who receive grant-in-aid scholarships were “employees” within the meaning of the National Labor Relations Act (“Act”) and therefore could be represented by a union. Northwestern argued that these players were student athletes and were therefore not eligible to vote. The Regional Director directed an election which took place last year.  The ballots were impounded pending the outcome of an appeal to the Board.

In a surprising Decision (pdf), the five member panel of the Board unanimously held that it would not take jurisdiction over the case and dismissed the union’s Petition.  As a result, the ballots will be destroyed since the decision is not appealable.

The Board’s Decision Not To Assert Jurisdiction

The Board based its ruling on the unique nature of this case stating that  its decision is primarily premised on the nature of the sports league (the NCAA Division 1 Football Bowl Subdivision) and the substantial  control exercised by the league over the individual teams,   it would not promote  stability in labor relations to assert jurisdiction in this case.   The Board looked to its experience in professional sports, where it noted it had not directed elections on a single team basis but rather on a league wide basis. It also noted at length that Northwestern, a member of the Big Ten Conference, was the only private university in the conference, that the rest of the schools in the conference were public universities and therefore, that even if their football players were deemed to be employees, the other teams would be outside the Board’s statutory jurisdiction since they would be public employees.

Northwestern is a private university over which the Board has jurisdiction. Its football team is part of the NCAA which has about 125 schools.  Only 17 of those schools are private schools. Northwestern was also in the Big Ten Conference and was the only private school in that league. The other schools in the leagues are public institutions over which the Board has no jurisdiction. Because the NCAA and the Big Ten have the authority to enforce its rules over all of their members, the Board concluded that it would be difficult to create any degree of stability in labor relations or competition in the conference as constituted since it could not assert jurisdiction over Northwestern’s state school competitors.

In reaching its decision, the Board made it very clear that it’s the scope of its decision was limited—e.g. it only applied to grant-in-aid scholarship players; it was not deciding whether or not these players were employees or students; that it was only dealing with Northwestern which was in a unique conference with public and private universities; and that its decision “did not preclude a reconsideration of this issue in the future”. The Board was also influenced by the fact that Northwestern had made significant changes in the terms and conditions of these players and that the NCAA had been encouraged to make significant reforms which “may result in changes to the circumstance of scholarship players that influenced.”

What This Means

While the Board did not decide whether the scholarship players were students or employees, it did distinguish the main case relied on by Northwestern and the many other universities that submitted amicus briefs to argue that these players were student athletes and not employees,  In Brown University, 342 NLRB 483 (2004), the Board found that graduate student assistants were not employees.  In fact, many observers had expected that the Board would use the Northwestern University decision as an opportunity to reverse its holding in Brown University and return to the short-lived decision in New York University (pdf) and once again hold that graduate teaching assistants are employees for purposes of the Act. The Board, in a footnote, noted that “with the potential exception of students seeking undergraduate degrees in physical education—the football activities they engage in are unrelated to their course of study or educational programs.”  This may be an indication of the Board’s position on this issue if the right case comes before them to reverse Brown.

Given the enormous ramifications in so many areas, if the Board had allowed these players to unionize, both the leagues and Northwestern, as well as the innumerable private schools and other individuals that have been waiting for this decision, have already expressed great relief over this ruling by the Board.  However, since the Board went out of its way to emphasize the narrow scope of its decision, the issues in in the case are far from over.