NLRB Ruling: Private School Athletes Can Unionize

[JMM28]

Potentially bad news for SLU.

http://espn.go.com/college-football/story/_/id/10677763/northwestern-wildcats-football-players-win-bid-unionize

This actually ties into the scholarships being year to year renewable and running off players. The NLRB cited the performance tied to the scholarship as one of the main factors along with hours "worked."

It will be interesting to see where this goes next.

[Dwayne's_World]

Northwestern needs to just drop all of the players' scholarships right now. Since they're "employees," they can pay for the education themselves and deal with all of the taxes that come with a paycheck. What a joke. Another example of unions overstepping their boundaries.

This could ruin college sports.

[OkieBilliken]

They can only legally get away with this at private institutions. This ruling board has no authority over govt run institutions. Can you imagine if SLU athletes unionized during Rev Larry's tenure? Our athletic department would be shut down that afternoon. College football is the death of everything good.

[MB73]

Not good, but something has to be done, a complete overhaul. The NCAA is incompetent, things are out of control.

There are SEC thug football players that cannot read, Kentucky hoops has a network for one and done stars - AAU & middle men - think anyone profits? Cam Newton's dad gets $ 180,000 but that's ok since Cam said he was unaware. There are sham classes for football and basketball players at high school freshmen academic level at many otherwise highly rated academic institutions. Etc.

We all know this and more but no one does anything about it, it just keeps getting worse. A joke.

I am not saying unions are the answer at all but at some point everything has to be restructured, maybe two competitive categories, 1) true scholarship student athletes and 2) players for hire (Ky, Bama, Florida State, et al) that do not even fake that they are students. Get it over with.

[sludevil]

Not good, but something has to be done, a complete overhaul. The NCAA is incompetent, things are out of control.

There are SEC thug football players that cannot read, Kentucky hoops has a network for one and done stars - AAU & middle men - think anyone profits? Cam Newton's dad gets $ 180,000 but that's ok since Cam said he was unaware. There are sham classes for football and basketball players at high school freshmen academic level at many otherwise highly rated academic institutions. Etc.

We all know this and more but no one does anything about it, it just keeps getting worse. A joke.

I am not saying unions are the answer at all but at some point everything has to be restructured, maybe two competitive categories, 1) true scholarship student athletes and 2) players for hire (Ky, Bama, Florida State, et al) that do not even fake that they are students. Get it over with.

Yup, the NCAA is awful. If this is a step towards the complete overhaul of college athletics, then it's a step worth taking.

[billikenfan05]

If the NBA/NFL change their rules against entering the league at a certain age would this improve the situation?

[slufan13]

If players want to be paid and treated like employees than they should be prepared to be fired/cut if they aren't doing well. Then they either have to find a new school or pay their way through school.

[billikenfan05]

Scholarships revoked, paid minimum wage pay your tuition when it's due.

[AlumniFan]

The very sad thing about this is that a very small percentage of athletes are in a position to benefit from this. The vast majority of student athletes play on teams that get little or no national recognition. The teams the play on are not huge cash cows. What I worry about is what if the entire scholarship system goes away? What happens to the kid who will never make money playing pro sports, but had the opportunity to got to school on an athletic scholarship? Now, that opportunity may be slipping away. That is very sad. I have been following this closely for years and the outcomes are highly variable. A lot of innocent kids just wanting to use their hard work and modest relative athletic ability to get a college education are going to get screwed because a small percentage of greedy kids and lawyers/agents want to get rich. Pathetic.

[JMM28]

The unintended consequences from the athletes side will be numerous. Reading the transcripts, Kain Coulter sounds like a petulant child.

In the end I don't think the players expected this ruling. It might be similar to when the dog catches the car. It might just fall by the wayside.

[Bizziken]

From what I understand, this is no big deal...it will get appealed and should be overturned, but who really knows.

I'm just spitballin here, but this would also apply to Division 2 and 3 athletics as well...I feel like (I'm honestly not sure) these institutions are better suited for STUDENT-athletes since it is a less commercialized environment. There are also some very top level institutions in Div 2 and 3: NYU, Carnegie Mellon, Wash U, MIT, Cal Tech, U of Chicago. College athletics (specifically Division I) has gotten out of control...something needs to be done to reel this in

[Deutschkind]

Interesting: http://www.sbnation.com/college-football/2014/1/28/5354718/college-football-players-union-pay-for-play

[slufanskip]

In principle I agree with every proposed rule change.

[slufan13]

Interesting: http://www.sbnation.com/college-football/2014/1/28/5354718/college-football-players-union-pay-for-play

I agree with all of that, but I think it's naive to think that getting paid for play isn't the end goal here.

The injury thing is what I most agree with. An athlete losing his or her scholarship to injury seems ridiculous to me.

If you want to pay the players, then make them pay taxes on that income. Make them pay for every meal, travel to road games, equipment, laundry, etc. Make them pay for their tuition too. If they don't have enough money, they can get student loans. No more relaxing admission standards to get star athletes into school either.

If the athlete sucks but he's getting paid then cut him or even trade him. If I suck at my job, I would expect to be fired or reprimanded in some way. If athletes want to be employees, then they should expect the same treatment.

Why stop at college? Look at a guy like Jabari Parker. People from all around the country come to watch his high school games. He brought in revenue for the school. Why not pay him too?

What happens if you start paying these big athletes? Even a small stipend could make schools go broke. They could cut other sports. Now the kid who just wants to play baseball or softball for 4 years and get a good degree is out of luck.

What about women's sports? God forbid you pay the men's basketball and football players, but not women's sports. That's a whole other problem.

A small stipend could be fine assuming the money came back from the NCAA.

The first thing I'd like to see is the NCAA relax the rule book a little bit. Oklahoma football players shouldn't be afraid of an NCAA violation because they ate more than their allotted portion and a graduation buffet. Majerus shouldn't get put on probation because he took Keith Van Horn to a diner at 2 in the morning after Van Horn's dad died. Maybe a player's family should be able to get financial help to fly out to their kid's games if they can't afford it. If an athlete hits a game winning 3 pointer at the buzzer, maybe some other students should be able to buy him a beer at the bar that night.

The NCAA is close to criminal in some ways, but paying athletes isn't the answer either. There are some kids who would live in their car to even pay for an education at Northwestern. Instead athletes with lesser grades get admitted to the school and those same kids aren't satisfied with a scholarship worth $40,000. 99% of them won't even play pro sports. Employers love a college athlete so they already have an advantage there. Not to mention not having hundreds of thousands of student loans to pay back. These kids can get a free education and then go out and get a job with a great degree and the money they make, they can keep rather than paying it back to the school or government.

[Old guy]

Lets set aside what is right and what is wrong for a second and just look at what happens when some kind of activity becomes much more expensive, particularly if it causes significant losses or has the potential to cause significant losses. The activity tends to be cut off, period. At one time SLU, Dayton, Georgetown all had football teams, do they now? This goes for academic activities as well, at some time Georgetown and Boston University had dental schools (Georgetown's was ranked #1 for a long time), do they have them now? The answer to the football and dental school questions is no, they were eliminated. Same thing happened to engineering at SLU, and the list for all I know goes on and on. Do we want Division 1 basketball to be eliminated from many, perhaps most, schools, do we want Division 1 football to be eliminated from many, perhaps most, schools. If the answer is no, then it is important that these programs do not become financial or legal burdens for the schools involved.

[brianstl]

I don't blame these kids for trying to organize to protect their interest one bit.

That said, it appears that a big part of the players argument is that the scholarship is actually compensation for services rendered instead of an award from the university for talent. I am not a lawyer, but if that argument is accepted could the IRS change how they view the tax situation on scholarships for athletes? Could the IRS decide that the athletic scholarships are not really awarded scholarships and instead are taxable income for the athlete? If that is the case then the players could lose a lot more than they could ever gain from this.

[Cowboy]

That said, it appears that a big part of the players argument is that the scholarship is actually compensation for services rendered instead of an award from the university for talent. I am not a lawyer, but if that argument is accepted could the IRS change how they view the tax situation on scholarships for athletes? Could the IRS decide that the athletic scholarships are not really awarded scholarships and instead are taxable income for the athlete? If that is the case then the players could lose a lot more than they could ever gain from this.

-BINGO, scholarships are in the tax code as being tax free for the recipient, this would appear to change that, so if you are on scholarship to SLU according to slu.edu undergrad tuition is $37,350, times 2 semesters that is $74,700 in taxable wages per year, now these kids are having to pay federal income tax, state tax in MO, social security and medicare (and so would SLU on the last two) on these wages, I wonder if they thought of that

[kshoe]

-BINGO, scholarships are in the tax code as being tax free for the recipient, this would appear to change that, so if you are on scholarship to SLU according to slu.edu undergrad tuition is $37,350, times 2 semesters that is $74,700 in taxable wages per year, now these kids are having to pay federal income tax, state tax in MO, social security and medicare (and so would SLU on the last two) on these wages, I wonder if they thought of that

I'm pretty sure the 37,500 is the yearly rate.

Nevertheless, what these kids want is for their "pay" to be materially higher than the cost of an education. If they get paid 150,000 and then get taxed that is better than a 37,500 scholarship.

[brianstl]

I'm pretty sure the 37,500 is the yearly rate.

Nevertheless, what these kids want is for their "pay" to be materially higher than the cost of an education. If they get paid 150,000 and then get taxed that is better than a 37,500 scholarship.

They aren't going to get paid $150,000. No minor league athletes make that much and for all the money that college football generates, it doesn't generate enough to cover that expense per player (especially at private schools). It doesn't generate enough for even half of that.

According to an an economist at the NLRB hearing yesterday Northwestern made $76 million in football profit over the most recent 10 year period. I know that sounds like a huge amount. That is $7.6 million a year. If you divide that by 85 it leaves you with around $89,000 available per player per year for total compensation expenses. When tax cost, FICA cost, the tax the player will have to play, etc get done whittling down the salary amount actually seen by the kids they will need to take out substantial student loans to attend Northwestern. Tuition plus room and board at Northwestern is $63,000 a year.

[kshoe]

They aren't going to get paid $150,000. No minor league athletes make that much and for all the money that college football generates, it doesn't generate enough to cover that expense per player (especially at private schools). It doesn't generate enough for even half of that.

According to an an economist at the NLRB hearing yesterday Northwestern made $76 million in football profit over the most recent 10 year period. I know that sounds like a huge amount. That is $7.6 million a year. If you divide that by 85 it leaves you with around $89,000 available per player per year for total compensation expenses. When tax cost, FICA cost, the tax the player will have to play, etc get done whittling down the salary amount actually seen by the kids they will need to take out substantial student loans to attend Northwestern. Tuition plus room and board at Northwestern is $63,000 a year.

If the football profit estimate assumes a "cost" of the students scholarship, then its $89k per player on top of the room and board. I find it highly unlikely that when testifying and thus wanting to make the profit as low as possible, they wouldn't have baked in the costs of providing room and board for their student athletes when determining how much profit was made.

I'm not one that is in favor of an open market for player pay, but I think we are barking up the wrong tree if people suggest that the athletes that play in big time college football and basketball will end up losing if the profits end up in their hands. The other athletes in non-revenue sports will most certainly end up losing. Coaches and ADs will end up losing. And the facilities arms race would slow down. But the actual athletes in the revenue generating sports will not lose.

[Bills By 40]

If the NBA/NFL change their rules against entering the league at a certain age would this improve the situation?

Definitely. Require an associate's degree before entering the pros and problem solved.

Interesting: http://www.sbnation.com/college-football/2014/1/28/5354718/college-football-players-union-pay-for-play

That was a great article. Assuming everything is true, that sounds like an alright idea. I'm for it.

[brianstl]

If the football profit estimate assumes a "cost" of the students scholarship, then its $89k per player on top of the room and board. I find it highly unlikely that when testifying and thus wanting to make the profit as low as possible, they wouldn't have baked in the costs of providing room and board for their student athletes when determining how much profit was made.

I'm not one that is in favor of an open market for player pay, but I think we are barking up the wrong tree if people suggest that the athletes that play in big time college football and basketball will end up losing if the profits end up in their hands. The other athletes in non-revenue sports will most certainly end up losing. Coaches and ADs will end up losing. And the facilities arms race would slow down. But the actual athletes in the revenue generating sports will not lose.

The economist was testifying as a witness for the athletes and not the school. Since he was called by the players, I assume that he is well aware that the scholarship cost is a bogus one and didn't use it on the expense side. I

[Cowboy]

I'm pretty sure the 37,500 is the yearly rate.

Nevertheless, what these kids want is for their "pay" to be materially higher than the cost of an education. If they get paid 150,000 and then get taxed that is better than a 37,500 scholarship.

-my bad

They aren't going to get paid $150,000. No minor league athletes make that much and for all the money that college football generates, it doesn't generate enough to cover that expense per player (especially at private schools). It doesn't generate enough for even half of that.

According to an an economist at the NLRB hearing yesterday Northwestern made $76 million in football profit over the most recent 10 year period. I know that sounds like a huge amount. That is $7.6 million a year. If you divide that by 85 it leaves you with around $89,000 available per player per year for total compensation expenses. When tax cost, FICA cost, the tax the player will have to play, etc get done whittling down the salary amount actually seen by the kids they will need to take out substantial student loans to attend Northwestern. Tuition plus room and board at Northwestern is $63,000 a year.

-I would love to see what is that $76mil figure and what is not

[DeSmetBilliken]

-BINGO, scholarships are in the tax code as being tax free for the recipient, this would appear to change that, so if you are on scholarship to SLU according to slu.edu undergrad tuition is $37,350, times 2 semesters that is $74,700 in taxable wages per year, now these kids are having to pay federal income tax, state tax in MO, social security and medicare (and so would SLU on the last two) on these wages, I wonder if they thought of that

It would be a game changer. One of the exceptions to scholarships being tax-free is if they are payments for teaching, research, or other services by the student required as a condition for receiving the scholarship.

Under the current model, sports can be viewed as an extracurricular activity, not services performed by the student. If participation in sports is deemed employment, they would obviously have to pay taxes on any wages received, but would also lose the tax-free nature of the scholarships they receive.

[Old guy]

The economist was testifying as a witness for the athletes and not the school. Since he was called by the players, I assume that he is well aware that the scholarship cost is a bogus one and didn't use it on the expense side. I

You obviously do not know the old saying about legal experts or expert testimony in general: "For every PhD (read economist) there is an equal and opposite PhD" There are generally no major problems finding experts to testify in front of a court, under oath, supporting both sides of an argument.