Regional Director of NLRB's Region 1 Office Upends College Sports by Declaring That Student Athletes Are Employees

On Monday, February 5, 2024, the Region 1 Regional Director of the National Labor Relations Board (“NLRB”) issued a Decision and Direction of Election that permits the Dartmouth College men’s basketball team to proceed forward with a union election. 

The National Labor Relations Act (“NLRA”) grants expansive rights to employees of most private sector employers, including the right to form or join a union, as well as the right to engage in protected, concerted activities to improve working conditions.  Historically, college athletes were not considered “employees”, and thus, were not protected by the NLRA.  But in September 2021, the General Counsel of the NLRB issued a memorandum that signaled an impending change, which has now arrived.  To determine whether an individual is an “employee”, the NLRB evaluates whether an individual (1) performs services that benefit another entity, (2) is subject to the entity’s control, and (3) receives some type of compensation or payment.  

In early 2023, college basketball players at Dartmouth College petitioned for an election before the NLRB’s Region 1 Office.  Their ability to pursue unionization turned on the key question: are these college athletes employees?  On Monday, the Regional Director answered with a resounding yes.  

Do the basketball players benefit Dartmouth?

These players are employees because they perform work which benefits Dartmouth.  Dartmouth argued that the players do not generate any revenue for Dartmouth, but the Regional Director emphasized that the basketball program “generates alumni engagement – and financial donations – as well as publicity which leads to student interest and applications.”   The Regional Director further pointed to Dartmouth’s general Athletic Department, noting that it had its own business office.  

Does Dartmouth control their work?

The players are also classed as employees because Dartmouth exercises “significant control over the basketball players’ work.”    Dartmouth determines “when the players will practice and play” or take part in “other team-related activities.”  

Are the players compensated?

Apparently.  While the players do not receive athletic scholarship, the Regional Director determined the players benefit from “early read” for admission before graduating high school, as well as equipment, apparel, tickets to games, lodging, and meals, all of which constitute compensation.   The players also receive “fringe benefits,” such as academic support, career development counseling, sports nutrition, and so on and so forth. 

So, what does this mean exactly for private colleges and universities? Watch out.  While this decision may be subject to appeal, for now, it may lead to further demands to bargain – whether or not the athletes receive a scholarship for play and whether or not the program is revenue generating.  This decision should be of particular concern for those private institutions located in Region 1, which serves: Connecticut, Massachusetts, Maine, New Hampshire, Rhode Island, and Vermont.  Colleges and universities should also take heed of Cemex Construction Materials Pacific, LLC, 372 NLRB No. 130 (“Cemex”), an NLRB decision from August 2023 which announced a new framework for determining when employers are required to bargain with unions without a representation election.  Under Cemex, an employer must either recognize and bargain with a union upon receipt of demand or promptly file an RM petition seeking an election. 

If you have further questions about the impact of this decision, do not hesitate to reach out to your labor counsel.