As with any legal ruling, the NLRB's Northwestern ruling will have unintended consequences. If this goes all the way to the Supreme Court, it's almost certain that the effect will become national in scope. And the questions raised by the ruling as it pertains to the future of big-time college athletics are going to be adequately dissected.
But what about the rest of the college sports landscape? How is this going to impact the 951 NCAA member schools who aren't members of the Football Bowl Subdivision?
1. What's the NCAA's purpose, anyway?
It's easy to forget, but the NCAA was formed back in the opening decade of the 20th century in order to prevent the government from banning college football altogether. It is a trade organization that has its roots in a pseudo-legal regulatory agency, one erected for the purpose of self-policing its membership rather than having the government step in and do the job for them.
One could argue with conviction that we might be better off if the response had been a federal regulatory agency unbeholden to the desires of the member institutions. But then we probably wouldn't have football on Saturdays and people would complain about the government messing everything up, because that's what people do.
Since then, the NCAA has become part police agency (without any actual power to fairly investigate violations), part mouthpiece, and part arbiter of competitive balance. Ultimately, while we may seethe at the first role and roll our eyes at the second, the third is actually the important one. None of the things people complain about in regard to the NCAA would even exist if it weren't for its mandate to encourage fair competition between institutions of like intention. Everything the NCAA has done that leads us to the current state of affairs has, at its root, been meant to prevent Big State University from simply building a professional team and running roughshod over its competition.
There is one exception to this, and it's key: the NCAA's role in preventing players from becoming considered employees. It's important to understand that this is primarily a relic from a time when its member institutions legitimately could not afford to pay for things like insurance and worker's compensation ... because they weren't raking in millions in annual revenue. When the NCAA inserted itself during the Cal Poly and University of Denver cases in the 1950s and '60s, it was acting to protect its members from an expense they simply couldn't afford, at a time when schools were dropping football left and right because it was too expensive.
For the big-time programs, that has long passed. But the NCAA continues to fight that battle, because it has to in order to ensure the survival of 90 percent of its membership.
2. This only applies to...
The ruling has severely limited applicability at present. But when you start the ball rolling, gravity takes over. The distinction between public and private institutions is a legal issue; states determine whether a class of people are considered employees or not at public institutions, so the NLRB doesn't have jurisdiction.
However, that's something that could be affected by a Supreme Court ruling, if it avers that college athletes are serving as employees. The Supreme Court could one day rule that employee status applies to all scholarship athletes at all private schools.
The impact on the lower classifications will vary. Division III could be untouched, since its lack of scholarships would mean no players are employees. Division II would be impacted, with the net effect likely being a tightening of its scholarship distribution; remember that in Division II, a football team can have 30 scholarship equivalencies, which are often spread out across the entire roster in the form of half-rides and quarter-rides. Should the ruling hold, you'd likely see those schools that continue to offer scholarships instead provide full rides for a fewer number of players. The same would apply to FCS, only on a larger scale with its higher scholarship limits.
But it's possible the distinction between scholarship and non-scholarship athlete might also be erased in the long run.
Division II's Northwest Missouri State and Lenoir-Rhyne. Marvin Gentry, USA Today
3. Hang on, there's no money there
One misconception is that this somehow only applies to the schools that make big money off sports.
In labor law, whether an employer is actually making money isn't particularly relevant. You still have to pay the people who work for you, and the definition of whether you're an employee doesn't take into account your employer's profit margin.
The only thing that matters is whether you're working for someone's benefit. If the employer is failing to take proper advantage of your labor, that's its problem. Now, the opinion does state that Northwestern's revenue is relevant, but what it's relevant to here is whether there's even something the union might be able to bargain for.
So yes, this might have an impact on lower divisions, although even if union organization reaches down that far the impact of actual union organization on those schools would very likely be minimal. When you're bargaining collectively, how much money the boss is making does have a relevant impact. But a ruling might still allow for players at those low-revenue schools to unionize (or, more likely by that point, join the existing union).
For example, McKendree University and the University of Indianapolis could be, in theory at least, impacted already. They are private institutions that offer scholarships for football, and they're located within the regional reach of the NLRB. To a lesser extent, all the other private Division II basketball programs in the region could be affected, as well as all the private mid-major Division I programs, such as Valparaiso. Although this ruling specifically applies only to Northwestern at present, if it's affirmed it would open the door to players at all of these schools petitioning.
They may or may not succeed, but once the cat's out of the bag, the test for how much revenue the employer sees may become less relevant than the fact that a precedent exists.
4. What about non-scholarship players?
Interns don't get paid, so obviously you can be an "employee" and not get paid. Right?
The thing is, the Department of Labor has been cracking down on the illegal use of unpaid interns to perform actual job functions. That it's been happening in such a widespread fashion for the last decade is because companies have been getting away with it, not because it's allowed.
There is a test for determining whether workers are considered employees for the purposes of forming a union. That test is what's referred to in the NLRB ruling, and the key phrase that could protect non-scholarship programs is the test for whether the worker is receiving compensation.
There is another test. It's the test used within the Fair Labor Standards Act to determine whether an employer can actually get away with not paying you, and it's a six-pronged question. It refers to "trainees," but it applies to any unpaid worker. You have to meet all six criteria in order to classify someone as a trainee (or a intern or a volunteer). Test No. 6 is that the "employer and the trainees understand that the trainees are not entitled to wages," which is nice ... but test No. 4 reads as follows:
The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded;
An athletic department, even a Division III one, is trying to earn money, even if it's just to recoup its own expenses. And one thing is undeniably true: they earn nothing but immediate advantage from their athletes. By this definition, every athletic department at every college in the country is employing employees, and in the absence of some sort of legislative relief, this is potentially going to be an issue even for non-scholarship programs.
It hasn't been before now, because the idea that even compensated student-athletes might be employees has always been shot down, never mind the uncompensated. Now, the tables have turned.
Sure, the Division III football players at the University of Chicago aren't eligible to join a union. They're not getting compensated, like Northwestern's are. But could the University of Chicago one day be found to be breaking the law by not compensating them? Will they have to start? Then the Maroons might be eligible to join your union too.
(You can still do volunteer work for a non-profit under this model, because the non-profit is not trying to benefit itself. If you volunteer to go build houses for Habitat for Humanity, the fruit of your labor is a charitable donation. But a college athletic department is not a charity.)
5. Come on, this is getting silly
It is. One could take the argument even further into the realm of the absurd and argue that high school athletes are employees. They're required to report to "work," after all. I think we can all agree that such a situation would be intolerable and stupid.
And I'm the first to admit that a court or mediator could look at all this and say, "Don't be ridiculous." Even then, if it came down to it, I would certainly expect some sort of legislative relief to protect those institutions who really are just playing around at sports as a meaningful adjunct to the educational experience. But there's a catch.
The very nature of that legislative relief, and any argument that claims non-scholarship players are not employees, would turn right around and nullify some of the arguments put forward by the players. If the Chicago Maroons are not employees of the University of Chicago, then you have to explain why they aren't without claiming that Chicago makes no money. Because that's irrelevant to the question of whether they're employees.
You also have to make that argument without claiming that Chicago "derives no immediate advantage from the activities" of the players, because even though that advantage is minuscule compared to Division I schools, it exists.
If you try to use those two arguments to claim Chicago's players aren't employees, you're actually attempting an argument that the Northwestern Wildcats aren't employees either. It doesn't matter whether your program is making millions or making nothing, and it doesn't matter whether you're being paid if under the law you're not allowed to do the work for free.
Work is work, workers are workers, and employees are employees.
These are questions that will have to be resolved, and they're going to have to apply to everyone. While the immediate risk to the lower divisions is non-existent, the long-term effects could be devastating unless steps are taken to legally clarify the difference between "athlete doing a job" and "student participating in extracurricular activities." The collegiate athletic experience for over a million athletes every decade is a large thing to risk in order to look out for the relative handful this ruling immediately benefits.