Are CHL hockey players amateur student athletes, independent contractors or employees?

November 17, 2014

Uncategorized

By Kimberly Jensen – Thompson Rivers University 2L JD Student

In a recent class action lawsuit, players claim $180 million for back pay due to being underpaid when compared to the minimum wage. Vacation pay, overtime, and punitive damages have also been claimed. The 16-20 year old players sign contracts with teams and are paid between $35.00 per week and $125.00 per week.

The Canadian Hockey League (CHL) claims its players are ‘amateur student athletes’, although their contracts say they enter into the team agreement as ‘independent contractors’ and the class action claims they are employees. So, what are they?

The consensus from legal commentators is that the issue will be whether players are independent contractors or employees. The website for BC Ministry of Jobs, Tourism and Skills Training and Responsible for Labor sets out the test for whether a person is an employee or an independent contractor –

“In order to be an independent contractor, a person performing services has to be in business for himself. Designating a person as an independent contractor does not decide the issue.”

In the standard player contract, players sign on as independent contractors, however as stated above, ‘designating a person as an independent contractor does not decide the issue’, so the contractual label for players may not be as relevant as it seems.

The Court has made it clear that the test is very contextual, and not all factors apply in all situations. The central question is: “Whether the person engaged in doing the actions did so as a person in business on his own account. In making this determination, the level of control will always be a factor.”

Control includes factors such as: Does the person take independent financial risk? Does the person have opportunity for profit? Is the person hired given instruction, supervised, controlled, or subject to discipline? Was the person told what to do, how to do it, and when to do it? Is the person under the direction and control of another regarding the time, place and way in which the work is done? Did the person have to do the work, or could that person give the work to someone else?

Application of these factors to the CHL debate indicates that the players are employees. Players do not take financial risk (high control by the league); the players do not have chance for profit above and beyond their wage (high control by the league); the players are given instruction and supervised, although this factor doesn’t really fit because of the inherent nature of instruction required in coaching sport (neutral). The players are told what to do and when to do it, however this is also part of being coached in a sport, so is neutral. The players are not under the control of someone else with regard to time, place, and form of work (high degree of control by the league) and the players could not subcontract their work out to another (high degree of control by the league)

The greater the degree of control by the entity paying the person, the greater the likelihood the person will be deemed an employee. In the application of some factors that illustrate the degree of control, it does seem that the league has a high degree of control over their players. Without further analyzing the case law to see what analogies can be drawn to landmark cases, it is impossible to say whether the degree of control found here is high enough. It does seem like the court will need to weigh in carefully on this case.

There are factors that make application of the employee or independent contractor test complicated. For example, players have different contracts depending on their age and whether they live in their hometown or not. Perhaps this case will add another category of worker to the special designations recognized in the BC Employment Standards Act. The Act already allows for slightly different rules for specific classes of workers such as domestic workers and farm labor contractors. The different rules take into account specific situations that are inherent to the employment due to the nature of the work and employment relationship.

A specific class makes sense for this case as well because there is some merit to requiring the players to be paid minimum wage. There is money to be made from operating a CHL team and it doesn’t seem fair that players give up so much of their time for so little compensation. The hope of one day playing in the NHL doesn’t come true for many players, and the scholarships that are available also seem to be elusive for many players so although there is a claim that the CHL provides benefits above and beyond the small financial reward, these benefits appear to be uncertain. A specific class of worker such as ‘semi-professional athlete’ might be able to protect the players while maintaining the financial viability of the CHL enterprise.

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