The National Labor Relations Board (NLRB) General Counsel has issued a complaint against the University of Southern California (USC), the Pac-12 Conference and the NCAA claiming that certain USC student-athletes are employees under the National Labor Relations Act (NLRA), and that the conference and the NCAA, along with the university, can be held jointly responsible employers for the treatment of those students under the law. This NLRB litigation portends fundamental consequences for private college and university athletic programs.

Read More >> NLRB Asserts Employment Protections for Student-Athletes and Seeks to Hold the University of Southern California, Pac-12 Conference and NCAA Liable

The General Counsel for the National Labor Relations Board (NLRB or Board), who has authority for setting prosecutorial policy for the NLRB, issued a General Counsel Memorandum (GC Memo) today, reversing the prior Board General Counsel’s position and asserting the employee status of certain student athletes at private educational institutions. Board General Counsel Jennifer Abruzzo conveyed her enforcement position in a memorandum to the Board’s Regional Directors. Because non-unionized employees have rights under the federal labor law, the immediate impact will be that the NLRB’s enforcement arm will be processing complaints related to allegations of adverse treatment of certain student athletes for all variety of internal complaints against private institutions.

Read More >> NLRB General Counsel Abruzzo Issues Memo on Employee Status of Players at Academic Institutions

As colleges and universities in New York know, new Regulations were recently adopted, effective December 31, 2013, amending the state’s Minimum Wage Orders, including the Minimum Wage Order commonly applicable to not-for-profit higher education institutions. These amendments reflect the statutory increase in New York’s minimum wage to $8.00 per hour, which is already in effect, as well as future scheduled raises in the state minimum wage to $8.75 per hour as of December 31, 2014, and to $9.00 per hour as of December 31, 2015. The relevant provisions of the above-referenced Minimum Wage Order apply to colleges and universities deemed to be “nonprofitmaking institutions.” This term includes:  “any corporation, unincorporated association, community chest, fund or foundation organized and operated exclusively for religious, charitable or educational purposes, no part of the net earnings of which inures to the benefit of any private shareholder or individual.” While this Minimum Wage Order generally applies the new $8.00 per hour minimum rate, it also continues to provide that bona-fide students working “in or for” such “nonprofitmaking institutions,” e.g., not-for-profit colleges and universities, are exempt from the definition of “employee.”  In other words, these students are exempt from the increased state minimum wage. The term “student” is specifically defined in the applicable Minimum Wage Order as “an individual who is enrolled in and regularly attends during the daytime a course of instruction leading to a degree, certificate or diploma, offered at an institution of learning, or who is completing residence requirements for a degree.”  Further, under this definition, such an individual continues to be a “student” even when school is not in session, so long as she was a student during the preceding semester. However, higher education institutions should remember that the Fair Labor Standards Act (“FLSA”) does not contain a comparable exemption and, at the present time, federal law independently imposes a minimum wage of $7.25 per hour for non-exempt employees.   Thus, hourly student employees must still generally be paid at this federal minimum wage rate for all hours worked, and at time-and-a-half of their “regular rate” for all hours worked over 40 in a workweek. At the same time, not all student “work” at higher education institutions constitutes an employment relationship subject to the FLSA and its requirements, although this distinction is not always easy to make.  Additionally, certain full-time students may be paid sub-minimum wages under the FLSA, but higher education institutions must obtain prior approval from the federal Wage & Hour Division. The bottom line is that colleges and universities should carefully examine their minimum wage practices, and practices with students who provide services to ensure compliance with both state and federal law.