BUSINESS MATTERS

College-athlete unions rife with complexities

Provide labor in exchange for compensation and most reasonable folks would consider you to be an employee. Your organization doesn’t even have to turn a profit. Even workers in a non- or not-for-profit enterprise are classified as employees.

Provide labor for payment, you’re an employee.

It seems like an incredibly simple concept.

What about a University of Arkansas football player devoting in excess of 40 hours a week, including some time around the office that is just as “voluntary” (wink) as those weekends you’re putting in to impress the boss? He’s getting paid - a scholarship, a housing allowance, plus some meals and team gear - for labor.

While those aren’t wages in the traditional sense, a regional office of the National Labor Relations Board ruled this month in Chicago that football players at Northwestern University are, in fact, employees. Legally speaking, those athletes now have the option to form a union that can collectively bargain on their behalf.

Establishing a union within a clear-cut workplace is a complex and lengthy enough process. Trying it in an industry - college athletics - where the laborers have been classified as something other than employees for 60-plus years is, in the most succinct way labor expert and author Phil Dine can describe it, “a very complicated situation.”

Laws on the formation of unions are “labyrinthine and antiquated,” to borrow a phrase from Dine. Plus, many employers choose to put up a fight - both legally and otherwise - when workers begin exploring their options. In industries where the turnover rate is high, the process is further complicated because employers can fight by arguing the workers who voted for protection are no longer employed.

Since 1953, college athletes have been legally designated as something other than employees. That distinction has saved the NCAA and your favorite college team billions.

Billions.

Current and former college athletes are beginning to fight back. We’re not seeing it locally now, but the outcome of the Northwestern University union case and an ongoing class-action lawsuit seeking compensation for the continued use of athletes’ likenesses after they leave school could have profound effects on the industry that is college athletes.

Last year the NCAA, a not for-profit organization, and its member institutions, also not-for-profit organizations, generated revenue in excess of $14 billion.

Initial reaction here might be to shrug off this disparity between industry revenue and employee pay as “life in the real world.” Unless you’re the top executive at your workplace, you’re likely seeing a fraction of the annual revenue.

That’s just how it goes, right?

Unlike employees at College Athletics Inc., though, you have the option of seeking employment elsewhere. If there is a better deal to be had, a workplace better suited to meet your needs, then you go. If you’re in a union shop you have folks who can negotiate a better deal on your behalf.

Athletes, while they do have the choice not to get involved in college sports, are only granted compensation up to certain point. In fact, they go into debt for the “privilege” of working in this billion-dollar industry.

According to a study by the National College Players Association and the sports management department at Drexel University, the average full athletic scholarship left athletes with a shortfall of $3,285 in the 2011-12 school year.

Regardless of how little you’re getting paid in the context of your workplace, you’re not paying to work.

Unions are likely not a realistic remedy. As mentioned above, the process of unionizing is just too complicated and slow-moving for an “industry” that generates “new employees” every three to five years.

Even for someone as well versed in the labor movement as Dine, author of State of the Unions, the issue of college athletes and unions raises questions.

What about nonrevenue sports? Do athletes in the UA women’s basketball program that is projected to lose nearly $3 million this year deserve a cut like football players, who helped generate a projected $26.5 million in ticket sales alone. Would athletes become responsible for paying taxes on their scholarships if they are designated as “employees?”

Employees in supervisory roles are unable to vote on forming a union. Would this legally exclude, say, team captains or upperclassmen from a vote? Dine says it’s not likely, but it’s still a question worth posing.

Dine is hopeful the plight of college athletes and the recent developments at Northwestern will help lend some additional understanding of the labor movement and unions. Perhaps this will serve to educate and make the topic of collective bargaining less polarizing.

“These athletes are pretty popular and that some see turning to a union as the answer raises some awareness,” Dine said. “They’re trying to address unfair treatment by forming a union. I could see it changing the dynamics of how some view unions.”

More importantly - as Dine and I discussed - this hopefully changes the dynamics of how little compensation college athletes are getting for their labor.

If you have a tip, call Chris Bahn at (479) 365-2972 or email him at [email protected]

Business, Pages 69 on 04/20/2014

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