College Athletes Claim as Employees Boosted in NCAA Labor Case

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While their litigation remains a long way from victory, six current and former athletes from a handful of colleges—Villanova, Fordham, Sacred Heart, Cornell and Lafayette—received encouraging news Wednesday from Pennsylvania federal judge John Padova, who denied those schools’ motion to dismiss Ralph “Trey” Johnson et al. v. NCAA.

The case centers on the claim that college athletes are employees under both the Fair Labor Standards Act (FLSA) and state labor laws and are owed minimum wage. A motion to dismiss raised by fellow defendants NCAA and others has not yet been decided.

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Johnson v. NCAA draws on a different federal law than the one cited by Kain Colter and other Northwestern football players in their effort seven years ago to be declared employees. The players in Johnson invoke the FLSA, which governs minimum wage and overtime pay, whereas Kolter’s petition to the National Labor Relations Board relied on the National Labor Relations Act, which protects the right of employees to unionize.

The Johnson v. NCAA players—three women and three men—have petitioned Judge Padova to certify their case as a class action. The judge’s denial of the motion to dismiss will likely enable the players’ attorneys to gain access to emails and sworn testimony from school officials. Those materials could include interactions with NCAA officials and conferences.

Judge Padova’s 30-page order covered familiar ground but cast traditional points in a more contemporary light. The 86-year-old judge, who decades ago served in the U.S. Army and JAG Corps and who President George H.W. Bush nominated in 1991, left little doubt about his critical views on NCAA amateurism.

He explained that NCAA member schools have “agreed not to pay students to participate in intercollegiate varsity sports,” including through bylaws that forbid wages and gifts. The judge added that college athletes “can only receive payment based on athletic performance through the U.S. Olympic Committee’s Operation Gold program, which pays NCAA-eligible student athletes for winning medals.”

Judge Padova also detailed how college athletes “must schedule classes around their required NCAA athletic activities” and that many “have reported that participation in NCAA [Division I] sports have prevented them from taking classes that they wanted to take.” Likewise, he noted that athletic programs and coaches, much like employers and bosses, “exercise significant control over their student athletes” regarding how they spend their time and potential disciplinary matters.

The schools assert that players are enrolled as students, not employees. They also cite precedent from other cases where similar lawsuits were rejected. They draw attention to Berger v. NCAA, a 2016 case from the U.S. Court of Appeals for the Seventh Circuit, in which the court reasoned that college athletes are amateurs and thus can’t be employees.

The problem for the schools, Judge Padova stressed, is that there’s a more recent case from a higher court: NCAA v. Alston, which the college-athletes-are-amateurs-because-they-aren’t-paid argument. To that end, Judge Padova emphasized that the Supreme Court categorically “rejected” the argument that limits on student athlete compensation—albeit in the context of education-related benefits, not athletics—are necessary ingredients to either college sports or the longstanding principle of amateurism.

In that same light, Judge Padova highlighted the much-discussed concurring opinion in Alston by Justice Brett Kavanaugh, who blasted the NCAA as a cartel. Consider Padova’s commentary on Kavanaugh’s analysis:

As Justice Kavanaugh noted in his concurring opinion in Alston, the argument “that colleges may decline to pay student athletes because the defining feature of college sports . . . is that the student athletes are not paid. . . . is circular and unpersuasive.” Accordingly, we reject the [NCAA’s] argument that Plaintiffs are not employees entitled to minimum wages pursuant to the FLSA because there is a long-standing tradition of amateurism in NCAA interscholastic athletics that defines the economic reality of the relationship between Plaintiffs and [schools].

Judge Padova also rejected the colleges’ argument that they can’t be the players’ employers due to U.S. Department of Labor guidance. The schools point to the Labor Department’s “Field Operations Handbook,” which expresses “University or college students who participate in activities generally recognized as extracurricular are generally not considered to be employees within the meaning of the Act.”

Judge Padova wasn’t persuaded. For one, he observed that “an internal agency manual” is owed a lower level of deference than other sources of authority, such as a statute or a Supreme Court ruling. He also underscored an unresolved argument by the players concerning whether the manual ought to even apply to their situation. The players, the judge wrote, insist that the manual “does not apply to students who participate in NCAA sports because those sports, unlike the other extracurricular activities listed in that section, provide no educational benefits to students and are not conducted primarily for the benefit of the participants as part of the educational opportunities.”

While the players—and their legal team, led by attorney Paul McDonald—should be pleased by Judge Padova’s ruling, a denial of a motion to dismiss is not tantamount to victory. The judge would have only granted the motion if he concluded that, even if all the players’ factual allegations are true, they failed to establish a claim that the law can remedy. In other words, the judge hasn’t examined the merits of the case, only if the claims are plausible. The bar to defeat a motion to dismiss is much lower than what the players will need to clear to win a jury trial. Such a trial could be years away, too, and there are also appeals.

But times have changed, as has—more importantly—Supreme Court precedent. And Judge Padova, whose order on Wednesday also discussed the massive revenues generated by college athletics, might be a favorable jurist for the players.

So, for now, the law is one step closer to recognizing college athletes as employees.

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