🏈 Northwestern's football players win NLRB ruling

[BAMANEWSBOT]

Read More Here from Sports Illustrated on players involved, implications for other private schools, how it may affect Alabama, etc...

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Northwestern plans to appeal National Labor Relations Board ruling from Chicago.

Read More Here from AL.com as they recap the story...

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Wednesday's labor ruling could pave the way for big changes. It's time for the NCAA to take notice.

Read More Here from SI on implications...

 

[psychojoe]

NLRB Rules for NW Players

The NLRB has issued a ruling this afternoon finding that the Northwestern players are athletes and that they can form a union. The ruling does not affect players at public universities, at least for now, as NLRB does not have jurisdiction over them.

It will be very interesting to see how this plays out and it has the potential to completely change the face of college athletics.

The ruling only applies to football players for now. I wonder if it will be extended to all scholarship athletes, or just those in revenue producing sports. On asks also, what about the significant number of programs who in spite of big $ fro television manage to end up in the red every year.

Stay tuned.

 

[planomateo]

Feels like I'm watching a really painfully slow motion train wreck. The train is called the NCAA (or college sports)...

 

[TheChief]

So as employees they must pay taxes on income (scholarships)? They will be entitled to workman's comp, I suppose. They'll also need to pay a portion of the cost for healthcare coverage that must now be provided per the Affordable Care Act. Watch those worms from the can that just opened.

 

[TheChief]

They'll have to conduct interviews for the scholarship positions, won't they? They'll also have to post job openings. This could get interesting.

 

[mhardiman]

This kind of crap could turn College Football into something very similar to the NFL; as much as it pains me to say this, but like the NFL I just may lose interest.

 

[psychojoe]

All kinds of ramifications. Is the value of the scholarship subject to income tax? FICA tax? Northwestern says its scholarship is worth 75k.

There is another action pending, a lawsuit filed by some athletes against the 5 power conferences and the NCAA for a share of the TV revenue produced by football and basketball. Absent congress granting the NCAA exemption from the anti trust laws, I expect the athletes will prevail. If that happens future college athletics will have no resemblance to what we have now.

 

[PhillyGirl]

NLRB Rules for NW Players

Basketball will be next.

This opens a can of worms re: which teams "are worth more" than others.

 

[It Takes Eleven]

All kinds of ramifications. Is the value of the scholarship subject to income tax? FICA tax? Northwestern says its scholarship is worth 75k.

There is another action pending, a lawsuit filed by some athletes against the 5 power conferences and the NCAA for a share of the TV revenue produced by football and basketball. Absent congress granting the NCAA exemption from the anti trust laws, I expect the athletes will prevail. If that happens future college athletics will have no resemblance to what we have now.

The scholarships, regardless of the ruling, are generally not taxable if it's a qualified (degree awarding) school and the student is making progress toward a degree. That would be the same for merit, athletic or need scholarships.

A slice of the pie for TV revenue would be the game changer.

RTR,

Tim

 

[TheChief]

The scholarships, regardless of the ruling, are generally not taxable if it's a qualified (degree awarding) school and the student is making progress toward a degree. That would be the same for merit, athletic or need scholarships.

A slice of the pie for TV revenue would be the game changer.

RTR,

Tim

Tim, not if the players are employees. Think again.

 

[TheChief]

If the players think they are entitled to profits, they are shareholders. What made them entitled to it? Employment. They were given unfair compensation, hence they will demand a share of profits. In fact, they were undercompensated. Their likenesses have been used and profit was made by that usage. They, therefore, became employees. All employees are subject to, as well as entitled to protection in regards to laws, employment mandates. Taxes would be a part of this. If the university broke even, think gave all profits to university subjected funds, the players have no recourse to receive a portion of said profits.

 

[TheChief]

Aren't we, as fans, entitled to some of the profits after offering our support and assistance in the advancement of the university's endeavors?

 

[ElephantStomp]

This is utter bullsh*t! I feel my interest in college football will diminish greatly.

You notice that at the schools where hockey is king and they make plenty of money off of the athletes, sports, etc aren't doing this?

 

[It Takes Eleven]

If the players think they are entitled to profits, they are shareholders. What made them entitled to it? Employment. They were given unfair compensation, hence they will demand a share of profits. In fact, they were undercompensated. Their likenesses have been used and profit was made by that usage. They, therefore, became employees. All employees are subject to, as well as entitled to protection in regards to laws, employment mandates. Taxes would be a part of this. If the university broke even, think gave all profits to university subjected funds, the players have no recourse to receive a portion of said profits.

They wouldn't be shareholders. That would indicate ownership. They were determined to be employees. As employees, they would be entitled to be paid for their work regardless of the magnitude (or lack, for that matter) of profitability of the employer. They are still kids on scholarship, though. The scholarships wouldn't be taxable under the circumstances I mentioned above. If a portion of their payments is contingent upon them performing some service (such as a student who get a scholarship but is also performing as a teaching or lab assistant, for example), then the portion representing compensation for that service would be taxable income.

Here's a potential scenario. Let's say a NW scholarship is indeed worth $75,000 and the football players reach an agreement to be provided a full scholarship plus $40,000 per year for "football services performed". As long as they are meeting the restrictions of the IRS to be enrolled in a qualifying school and seeking a degree, the value of the scholarship isn't taxable. The $40M is taxable.

RTR,

Tim

 

[TerryP]

Adding to what Tim said, as I understand the taxation...

You're allowed a standard deduction, and as long as you aren't a dependent, and exemption as well.

What the amount of the stipend is comes into play here...if it's less than the total of that deduction and exemption you aren't required to file. In 2013 I believe that total was 10K. Assuming it remains the same, as long as the stipend is less than 10K players wouldn't be required to file on the scholarship or the stipend.

 

[TerryP]

Just an idle thought here on differences in players mentality.

We all know guys like AJ spent hours in the film room looking to improve his game. What was his motivation to do so? Was it about the team, about his future dreams, about winning?

Colter, in the same position at Northwestern, says he spent 40+ hours a week in their football facility. I'd assume it was doing the same thing AJ was doing at Bama. That's not a stretch, right?

Yet, Colter says "it was a job" due to the number of hours.

If we were to get down to the crux of the matter, the motivating factor for guys like McCarron, Murray, Bortles, and other QB's who are at the elite level in collegiate play, how to they describe their time spent? Are they calling it "a job," or are they looking at the time spent as "self-help/personal improvement?"

 

[TerryP]

A different post because it's a different thought on this subject.

Alabama is a right to work state which means this ruling has to include the aspect of state labor laws. Those laws can prohibit, and at the very least limit, groups to become "bargaining units."

In the SEC, 13 of the 14 states are "right to work" states: Kentucky being the exception.

I've seen two figures this morning with one saying there's 22 right to work states, another saying 24. Here's a map I pulled from Wiki...consider it in terms of recruiting.

 

[TerryP]

Agree with Mandel here...it's worth a few minutes to read.

<blockquote class="twitter-tweet" lang="en"><p>Some of the most insightful comments I've seen on Twitter re: Northwestern union are from former Mizzou WR <a href="https://twitter.com/TJMoe28">@TJMoe28</a>. See timeline.</p>&mdash; Stewart Mandel (@slmandel) <a href="https://twitter.com/slmandel/statuses/448995142406782976">March 27, 2014</a></blockquote>
<script async src="//platform.twitter.com/widgets.js" charset="utf-8"></script>

 

[TerryP]

One of Moe's comments: Another good point- if being paid a salary, no need for scholarships anymore. Gov't gets involved with taxes and would cost everyone more $$

 

[planomateo]

Remember why this started - concussions/player safety, protecting scholarships, and just getting a seat at the table. This was never about money...but it will eventually turn into that.

That being said, the road to hell is paved with good intentions.

Ironically, the players think they have been used by the NCAA, I'd argue they were just used by the CAPA to get this pushed.