Could Michigan be starting a new trend by excluding public university student-athletes from being "public employees"?

Michigan Governor Rick Snyder's signature on House Bill 6074, which is now law known as Public Act 414, is something I have been dying to discuss since the dawn of the new year. This is why: Michigan became the first state to exclude student-athletes at public universities from its definition of "public employee" and, therefore, does not grant the group the right to union representation or to collectively bargain.


Michigan State Representative Al Pscholka introduced this bill in mid-December to amend various sections of Michigan's Public Employee Relations Act (PERA), including section 1's definition of a "public employee." Currently, courtesy of Public Act 414, section 1(1)(e)(iii) PERA states that Michigan's meaning of "public employee" is subject to the following exception:

An individual serving as a graduate student research assistant or in an equivalent position, a student participating in intercollegiate athletics on behalf of a public university in this state, or any individual whose position does not have sufficient indicia of an employer-employee relationship using the 20-factor test announced by the internal revenue service of the United States department of treasury in revenue ruling 87-41, 1987-1 C.B. 296 is not a public employee entitled to representation or collective bargaining rights under this act.
— Public Act 414


This is Michigan's attempt at a proactive response to the numerous lawsuits filed related to student-athlete compensation that are pending in federal courts across the nation. Most notably, the plaintiff Northwestern University scholarship football players already won a favorable determination nearly one year ago when the National Labor Relations Board (NLRB) in Chicago found that they were "employees" within the National Labor Relations Act (NLRA) definition and, thus, have the right to union representation for collective bargaining. The board found that "[i]t cannot be said that the employer's scholarship players are 'primarily students,'" as Northwestern, the "employer," argued. The five-member NLRB in Washington is presently reviewing Northwestern's appeal of that heavy decision. By enacting this amendment, Michigan is hoping to prevent any similar legal actions by Michigan student-athletes that other states are struggling to control. As a side note, I find this striking considering how important organized labor has been to Michigan over history, although it does reflect shifting policy like the state's recently enacted right-to-work law.

On its face, Public Act 414 looks like a low-blow to student-athletes in a time where the discussion over compensation is riling up, but certain facts make Michigan's reaction not only legal but actually wise. I believe this move effectively places a "period" after answering the question of whether student-athletes at Michigan public universities are entitled to PERA's protections because they are not "employees" for the purposes of PERA in the negative.

The NLRB has statutory jurisdiction over private sector employers who engage in a minimal level of interstate commerce. So, Michigan public universities and their employees are not within the NLRA's scope while Michigan private universities are within its scope like the private Northwestern University. The public-private distinction is significant, and that distinction creates no direct conflict with federal law. Without an express exception in state statutory law distinct from anything going on with the NLRA, public universities are subject to attack by student-athletes and would likely lose the battle because they would have no armor to shield themselves from similarly structured arguments. Even though the NLRB decision would not directly govern a case where a public university is sued, it could be very persuasive authority. Because this amendment applies exclusively to public universities (i.e., it does not apply to private universities in Michigan or any universities outside of Michigan), it has the right amount of power to protect the state from potential lawsuits by student-athletes and is not terribly domineering.

Since the states operate public universities and likely want to protect themselves from cases analogous to the Northwestern football suit, will other states follow along? For instance, one North Carolina public workers union allows scholarship student-athletes at public universities individual membership as state employees, but the state has been silent so far. In contrast to Michigan's approach, a few days ago, Connecticut lawmakers introduced House Bill 6783 as a study that could expressly allow student-athletes to join a union. I believe this approach is shaky and would create multiple issues such as which student-athlete groups have permission to join (e.g., only the "money-making teams" or endorsement earners) and what benefits they could receive.

If other states do, maybe we would begin to see a divide between public and private universities within divisions due to jurisdictional differences like we have already seen with the NCAA's Power 5 partially detached from the other conferences. If other states do, it could implicitly support the NCAA's argument against treating student-athletes as "employees" and focusing on college's educational purpose. Maybe the NCAA could react in return to stabilize not only how it defines "student-athletes" and their place within the multi-jurisdictional intercollegiate market but also how we as a society view student-athletes, how state and federal law views student-athletes, and how student-athletes view themselves.