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Friday, January 31, 2014

Reason For Outrage On Sunday: Unpaid Super Bowl "Volunteers" Are Illegal

The NFL will have an estimated 13,500 "volunteers" working at the Super Bowl. The NFL just announced that 1500 of these "volunteers" will now be paid. The rest will have to sign waivers agreeing not to sue, not to participate in a class action suit, and to arbitrate if they do sue.

Since when is the NFL a not-for-profit agency? Am I missing something? There's no such thing as an unpaid volunteer working for a for-profit company. Period. Ask Major League Baseball, which is now defending against a class action suit for all the "volunteers" it had working  without pay at for profit events. The NFL, which makes about $10 billion a year, can afford to pay minimum wage to its workers.

Imagine Goldman Sachs or Burger King soliciting volunteers to come work for them. We'd be outraged. So why is there little outcry when one of the most profitable for-profit enterprises solicits thousands of people to work for free?

Here's what the Department of Labor has to say about when volunteers may work without pay:

The Fair Labor Standards Act (FLSA) defines employment very broadly, i.e., "to suffer or permit to work." However, the Supreme Court has made it clear that the FLSA was not intended "to stamp all persons as employees who without any express or implied compensation agreement might work for their own advantage on the premises of another." In administering the FLSA, the Department of Labor follows this judicial guidance in the case of individuals serving as unpaid volunteers in various community services. Individuals who volunteer or donate their services, usually on a part-time basis, for public service, religious or humanitarian objectives, not as employees and without contemplation of pay, are not considered employees of the religious, charitable or similar non-profit organizations that receive their service.

For example, members of civic organizations may help out in a sheltered workshop; men's or women's organizations may send members or students into hospitals or nursing homes to provide certain personal services for the sick or elderly; parents may assist in a school library or cafeteria as a public duty to maintain effective services for their children or they may volunteer to drive a school bus to carry a football team or school band on a trip. Similarly, an individual may volunteer to perform such tasks as driving vehicles or folding bandages for the Red Cross, working with disabled children or disadvantaged youth, helping in youth programs as camp counselors, scoutmasters, den mothers, providing child care assistance for needy working mothers, soliciting contributions or participating in benefit programs for such organizations and volunteering other services needed to carry out their charitable, educational, or religious programs.

Under the FLSA, employees may not volunteer services to for-profit private sector employers. On the other hand, in the vast majority of circumstances, individuals can volunteer services to public sector employers. When Congress amended the FLSA in 1985, it made clear that people are allowed to volunteer their services to public agencies and their community with but one exception - public sector employers may not allow their employees to volunteer, without compensation, additional time to do the same work for which they are employed. There is no prohibition on anyone employed in the private sector from volunteering in any capacity or line of work in the public sector.
The Department of Labor also discusses the issue of a shortage of workers (which I can't believe there would be anywhere in this economy:

If your business has a shortage of workers and is looking to “volunteers” to help out, be aware that the Fair Labor Standards Act (FLSA) has stringent requirements with respect to the use of volunteers.  In general, covered, nonexempt workers working for private, for-profit employers have to be paid at least the minimum wage and cannot volunteer their services.  Check with DOL for the rules governing the circumstances where volunteering in the public and private, non-profit sectors may be allowed.
For-profit companies can't ask staff to volunteer to work at for-profit activities. The Department of Labor advises:

Just like other individuals, staff of facilities that provide employment and services to workers with disabilities may volunteer to perform certain tasks for their employers without creating an employment relationship under the FLSA. However, under the FLSA, employees may not normally volunteer services to for-profit employers. 

Employees of a work center or hospital cannot volunteer to perform the same services they are normally employed and paid to perform. For example, a secretary cannot volunteer to respond to correspondence generated by a special fund-raising drive.

Individuals, including staff members, who “volunteer” to help a work center or hospital meet production deadlines required by contract or subcontract work orders are not considered volunteers under the FLSA and an employment relationship exists when they are engaged in such activities.
 If a for-profit employer mandates employees to work on charitable activities, then the employees must be paid. DOL explains it this way:

[W]hen an employer directs an employee to volunteer, that time is compensable.  The regulations state:

Time spent in work for public or charitable purposes at the employer's request, or under his direction or control, or while the employee is required to be on the premises, is working time.  However, time spent voluntarily in such activities outside of the employee's normal working hours is not hours worked.
29 C.F.R. § 785.44 .... 

Therefore, we caution that volunteer activities “must be truly voluntary and any coercion or pressure, whether direct or indirect by the [employer] to participate in this program outside of [] duty hours would negate the voluntary nature of the program.”  WH Opinion Letter January 29, 1999....  [E]mployers may encourage their employees to volunteer their services for public or charitable purposes outside of normal working hours without incurring an obligation to treat that time as hours worked so long as participation is optional and non-participation will not adversely affect working conditions or employment prospects.
Several courts have upheld agreements where employees agreed to waive their right to bring class actions and to arbitrate Fair Labor Standards Act claims. However, an employee can't agree to waive their right to be paid. It will remain to be seen whether a court will uphold any part of these releases the "volunteers" are signing for the Super Bowl.

In an economy where a huge part of the population is unemployed, it's a darned shame that a for-profit organization like the NFL is taking advantage of members of the community and simultaneously avoiding a golden opportunity to provide much-needed work to thousands of people.

They're breaking the law. Be outraged.


  1. This comment has been removed by the author.

  2. Believe it or not, but the NFL *is* a not-for-profit organization. The IRS considers them a nonprofit trade organization. Crazy, huh?

  3. I fail at links apparently, but here's a few recent news stories on it. It has slowly become a bigger news story the last few days, which is probably why the NFL made this move in the first place. This is a peace offering to try to keep people from looking closer into this and potentially taking action.


    1. Thanks for these links. I'm gobsmacked. Now I'm really outraged.

    2. Coming in late to the conversation. I'm a huge NFL fan. That said, I've been irate for YEARS at the non-profit status. I don't know the exact number but last I heard it was a $5B USD year business. Also, the NFL owns all of the marketing stuff. ALL of it. For example, if I buy a Russell Wilson NFL jersey for $130 - Russell doesn't receive any money from it.

  4. The NFL's 990... http://www.guidestar.org/FinDocuments/2012/131/922/2012-131922622-0907a8cd-9O.pdf
    It's hard for me to say it's ok that they're using volunteers when the commissioner took a $22 million bonus in 2012 when the 990 claims they had a $77 million deficit.
    The big question is SHOULD the NFL be a nonprofit.

  5. Wow. I'm really shocked at their nonprofit status. It shows how much I know about sports. I'm willing to bet that a lawsuit challenging the unpaid workers could also challenge this status. This is a huge industry with huge profits. Nonprofits aren't excluded from FLSA, so the question will be whether the services being performed are typically associated with volunteer work or whether they are displacing people who would normally be paid.

  6. There's a thin branch supporting a possibility of a volunteer non-employee (for FLSA), even in a for-profit business. "An individual who, 'without promise or expectation of compensation, but solely for his personal purpose or pleasure, worked in activities carried on by other persons either for their pleasure or profit,' is outside the sweep of the Act. Walling v. Portland Terminal Co." says the US Supremes in Tony & Susan Alamo v. Sect. of Labor at http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=471&invol=290 Super Bowl volunteers could be "outside ... the Act."


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