NIL changing employee status of college athletes
Employee status is important for several tax reasons. It is also important for state and federal labor law purposes.
There is no single test that determines employee status. IRS uses 20 factors. Broadly speaking, employees are subject to the control of their employers.
My first employment was as a dishwasher at a restaurant open 24 hours per day. I bused tables, washed dishes and carried tubs of ice cream out of the walk-in freezer.
I also had to vacuum the carpets. The carpet rule – I had to wait until the section of the restaurant was empty before vacuuming.
I was told that I would work until 1 a.m. I always left at 2 a.m. or later. Why? Because I had to wait for talkative people to clear out each section of the restaurant so I could vacuum.
My employer set the vacuuming rules. That’s how employment works. My second job was as a janitor at a hospital.
I was given a list of things to do at 7 a.m. when I started work. The ER had to be done first, then the cafeteria.
The cafeteria had to be done by 9:30 a.m. for the morning break. The ER was usually slowest early in the day, so I started there.
These decisions were not mine to make. That is the nature of employment. That is an example of control.
The growth of name, image and likeness deals, known as NIL, for college athletes has emboldened these athletes to challenge their employee status.
Athletes have filed lawsuits against the NCAA and grievances with the National Labor Relations Board .
Employee status would grant athletes certain rights. This might include payment of a minimum wage.
Employee status would also raise the specter of burdens. Benefits now called scholarships would likely become taxable.
Football players at Northwestern University previously filed NLRB grievances. I wrote about that case when it was active.
Now it has become a tsunami. Last month, the NLRB had a hearing in Los Angeles. The hearing will drag on through February and may include testimony from coaches and athletic directors.
The big conferences and revenue sports seem the culprits in these grievances. The Los Angeles hearing had testimony from Brandon Outlaw, a former USC football player.
Outlaw said that his attendance was monitored at dining halls by a fingerprint scan. His class attendance was monitored, and he sometimes had to send pictures of himself in class.
He was regularly urine tested for hydration and checked almost daily for weight. Any interviews he might give had to be cleared first. He spent 60 hours per week on football activities.
Outlaw said he could not leave a team hotel without the rest of the team. If in a town where he had a friend, they could not meet for coffee.
If a spouse held you to those rules, you would surely point out to the marital counselor that you lived with a control freak.
Interestingly, the control/ employee thing is expanding beyond the big schools and the revenue sports.
In Johnson v. NCAA, Trey Johnson is the named plaintiff. Johnson is a former football player for Villanova, an FCS program.
Villanova is joined as defendant by 30 other schools. This includes its football rival Delaware and three Ivy League schools — Penn, Princeton and Cornell.
Without checking, write down the location of some other defendants: Rider, Sacred Heart and Bucknell.
The Dartmouth men’s basketball program is separately petitioning the NLRB. Dartmouth players get zero NIL money.
Dartmouth argues that the men’s basketball team loses money and must be subsidized by the school. Players also get nonathletic grants that stand if the player quits the team.
Players respond that the school actively fundraises from men’s basketball. They contend the added fundraising more than offsets the loss from the program.
Employee status will bring joys and sorrows to both players and schools. Who wins and loses depends on the issue.
Bob Dylan wrote the classic “The Times They Are a-Changin’.” The line “your sons and your daughters are beyond your command” may not apply to their athletic departments.
Who commands will determine just how much the college athletic scene is a-changin’. But the line has been drawn, the curse has been cast, the present now is soon to be past.