"March Madness" Concerns for Employers

"March Madness" Concerns for Employers

March 14, 2011

The National Collegiate Athletic Association (NCAA) Tournament Selection Committee announced the sixty-eight (68) teams that will participate in the 2011 NCAA Men’s Division I Basketball Championship Tournament.  The Tournament will start with play-in games on Tuesday, March 15, 2011 and conclude with the Championship Game on Monday, April 4, 2011 in Houston, Texas.  Over the next three weeks, the United States economy will lose an estimated $1.8 Billion in productivity as employees watch early round games; participate in office pools, and discussing the outcomes with co-workers.

The impact of “March Madness” is wide spread.  Challenger, Gray & Christmas estimate that 58.3 million people are expected to participate in an office pools.  The same organization forecasts that ttotal online viewership of games by workers during working hours could reach at least 8.4 million employees.  Many employers have abandoned all attempts to prohibit office pools and allow them to take place in the name of “morale”.  While participation in a joint experience such as the NCAA Division I Men’s Basketball Tournament may have the effect of bringing employees together, there are still several legal implications that employers should consider:

  1. Office pools for money are technically illegal gambling and may constitute a felony in New York.  An employer that permits an office pool to take place on its premises may be found to be advancing gambling activity, which could also be prosecuted as a crime.  However, as long as the pool is operated on a fair and reasonable basis, it is extremely unlikely that law enforcement officials will take interest in your office pool.  Basic suggestions for keeping an office pool reasonable are that the organizer not take a cut, all of the money brought in from the pool should be distributed to participants, all participants should be at least eighteen (18) years old, every participant should be on equal terms, a special web-site should not be created to solicit participation and collect money, and the number of participants and the costs should be contained to a reasonable level (e.g. less than $500).
  2. Allowing employees to encourage and solicit participation in office pools can open the door for other workplace solicitation such as union organization.  Employers that do not have a no solicitation policy in effect should consider adopting one; however, once an employer adopts such a policy, it must enforce it consistently, even if it means prohibiting the sale of Boy Scout popcorn, Girl Scout cookies, Little League candy bars, NCAA Tournament Pools, and SuperBowl Squares.  If an employer elects not to prohibit such solicitations in the workplace, it leaves itself open to workplace solicitation by labor unions.
  3. Many employers have rules or policies that limit the use of employer equipment to work related activities.  Allowing the use of employer equipment and systems to run the NCAA Pool, such as copy machines, computers, e-mail, and the internet, in violation of office policies limiting the use of these items to business related activities, may weaken the employer’s ability to enforce those policies in the future.
  4. There is a statistically significant difference in gender participation in “March Madness” Pools: Approximately 24% of male employees in surveys have indicated that they are likely to participate in an office pool, compared to just 11% of female employees.  An employer that sanctions an activity that is clearly preferential to male employees increases the risks of a sex discrimination charge.  While the existence of an office pool alone may not be the basis for a charge, it may be additional evidence of alleged gender preference.