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NLRB: Lacrosse officials were employees, not independent contractors, of interscholastic athletic association

By Ronald Miller, J.D.

Lacrosse officials were employees of the Pennsylvania Interscholastic Athletic Association, Inc. or PIAA, ruled a divided three-member panel of the NLRB, in a 2-1 decision. The Board found that PIAA controlled the manner of work performed by officials; that the officials performed their work in the name of PIAA, and PIAA had wide-ranging rules governing officials’ conduct and evaluated their adherence to its policies. PIAA also set game schedules, thereby providing the place and time of work. Moreover, PIAA’s control over the officials’ compensation system outweighed considerations supporting independent contractor status, so that the method of payment factor also favored employee status. Thus, finding that the PIAA’s business was providing a system of fair play, and the officials were an integral part of that business, the Board concluded that the officials were employees. Chairman Miscimarra filed a separate dissenting opinion (Pennsylvania Interscholastic Athletic Association, Inc., July 11, 2017).

An NLRB regional director found that lacrosse officials were employees covered under Section 2(3) of the NLRA. Thereafter, the employer, the Pennsylvania Interscholastic Athletic Association, Inc. or PIAA, filed a timely request for review contending that the officials were independent contractors, excluded from coverage. The NLRB granted the request for review with respect to the independent contractor issue.

Registration of referees. The PIAA is a nonprofit corporation that promotes uniformity of standards in interscholastic athletic competitions of its member schools. Among other things, it provides member schools with access to its pool of “registered sports officials” to referee various sporting events. The union sought to represent a unit of approximately 140 officials who refereed lacrosse games within two PIAA districts.

The PIAA’s board of directors is empowered to determine the method of and qualifications for registration of officials; to determine their powers and duties; and to make and apply necessary policies, procedures, rules, and regulations for such officials. In order to become a registered official, an individual must meet certain PIAA requirements, pay a registration fee, pass a background check, and receive at least 75 percent on a PIAA-administered test for the particular sport. Once an applicant’s registration is approved, he or she must become affiliated with a PIAA local chapter within 15 days, or face suspension.

In order to remain a PIAA official, an individual must attend at least six chapter meetings during the course of the sport’s season, as well as the chapter’s annual “rules interpretation meeting.” Officials must pay annual dues. PIAA may suspend or remove any official who does not comply with its constitution and rules.

Game contracts and payment of fees. Officials are assigned to specific games. They may decline regular season assignments if they find the school’s proffered fee unacceptable, without being penalized. Once an official accepts an assignment, PIAA policy requires that the “host” school and the official sign a contract, whose form is provided by the PIAA. Although PIAA does not involve itself in negotiating the amount of fees, it has rules governing the process of payment. PIAA also plays a role in the enforcement of contracts. PIAA expressly disapproves of any attempt to negotiate fees collectively. Fees average about $70 per varsity game. Payments are made on a per game basis, and schools do not withhold money for taxes or Social Security. During the regular season, schools are encouraged to evaluate officials’ performance, using a PIAA evaluation form.

Common law agency principles. In FedEx Home Delivery, the Board reaffirmed its reliance on common law agency principles in assessing independent contractor status. Here, the Board found that PIAA has far-reaching control over the means and manner of the officials’ work through its comprehensive rules. Moreover, because the officials performed their functions in furtherance of PIAA’s core operations, and did so in PIAA’s name, not their own names, they were a critical part of the association’s operation.

Lacrosse officials have no direct supervision on the playing field, and their calls cannot be directly appealed. However, the Board concluded that this lack of direct supervision reflected the nature of officiating, rather than suggesting independent contractor status. The Board found that PIAA tightly controlled the work that the officials performed through mandatory adherence to rules, regulations, policies, and procedures. Next, the Board found that the officials’ particularized skills did not preclude them from being employees, since PIAA certified officials and required them to receive ongoing PIAA training. Further, since PIAA set game schedules, it provided the place and time of work.

However, the Board agreed with the regional director that the length of time for which an individual was employed was an inconclusive factor. Single game assignments were short-term, but officials had an expectation of continued employment so long as they paid their annual dues, and met PIAA’s performance standards. On the other hand, PIAA’s control over the officials’ compensation system outweighed considerations supporting independent contractor status, so that the method of payment factor favored employee status. Finally, the Board observed that there was nothing officials can do to increase their opportunity to contract for more jobs in a given time period.

Thus, weighing all of the incidents of the officials’ relationship with PIAA, the Board affirmed the regional director’s finding that the lacrosse officials were statutory employees. In so ruling, the Board agreed with the regional director’s application of FedEx Home Delivery, and her conclusion that Big East Conference was not controlling here.

Dissent. In a dissenting opinion, Chairman Miscimarra was convinced that the Board lacked jurisdiction because this case gave rise to substantial questions about whether PIAA was a “political subdivision” of the Commonwealth of Pennsylvania, or alternatively, that the Board should decline jurisdiction over state interscholastic sports governing bodies as a class pursuant to Section 14(c)(1) of the NLRA. In any event, he argued that PIAA’s petition should be granted because the lacrosse officials were independent contractors. Miscimarra argued that the evidence overwhelmingly indicated that the officials were independent contractors based on their authority to referee games free from any supervision or control, the distinct skills they possessed, the fact that they were paid on a per game basis, and their freedom to take other work.