Are UFC fighters employees or contractors? Why the distinction matters – and could mean millions

Discussion in 'UFC Discussion' started by FedorGOAT, Aug 13, 2017.

  1. FedorGOAT Jones>Fedor

    FedorGOAT
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    This is a great read. Nice piece from MMAjunkie.

    Here is the full article copied for anyone interested.

    Bellator President Scott Coker heard the complaints from his new signees.


    Fighters who came over as free agents after their UFC contracts expired had very similar gripes, many of them about the UFC’s “athlete outfitting policy” under an exclusive apparel deal with Reebok. What Coker couldn’t understand was how it was even legal.


    “Listen, they’re independent contractors,” Coker said in June. “How they’re forced to wear a uniform, to this day, still baffles me. It should be against the labor laws or something.”

    It’s not just the mandatory Reebok fight kits, either. UFC fighters are also forced to participate in an anti-doping program administered by USADA, which requires them to disclose their whereabouts at all times and make themselves available for surprise drug tests.

    That’s what rankled former UFC bantamweight champion T.J. Dillashaw, who discussed the matter on a Team Alpha Male podcast last year. With so many restrictions and requirements, Dillashaw wondered, how could fighters still be classified as independent contractors?

    “They treat us like employees, but they don’t give us benefits like employees,” Dillashaw said. “It’s kind of crazy when you think about it. We have to tell them where we’re at at all times so USADA can show up and drug test us, but we don’t get health benefits. It’s kind of crazy that we are controlled. Any time you have to tell work where you’re at and what you’re doing, that’s considered an employee, not a contractor.”

    It often seems like an ancillary issue, and one many UFC fighters ignore completely. The state of fighter pay, or the effects that the Reebok deal has had on the sponsor market for individual fighters, these seem to rate higher on the fighters’ lists of grievances.

    But as the UFC has placed more restrictions on its fighters, the case for keeping them classified as independent contractors has weakened, according to some observers both in and outside the MMA industry. And if the employment classification of UFC fighters was ever successfully challenged, it could mean major change for the industry leader.

    “One consequence for the UFC is if they’re misclassifying employees as independent contractors, then they owe the IRS a lot of money,” said Justin Swartz, an attorney with the firm Outten & Golden, one of the nation’s largest law firms to focus solely on employment law.

    Swartz has worked on similar cases involving the misclassification of exotic dancers in New York, where some clubs were eventually forced to pay millions of dollars in settlements after years of misclassifying employees as independent contractors.

    “Dancers at strip clubs, they have schedules, they have rules to follow, and they have no business at all without the club,” Swartz said. “In some ways it’s the same with fighters. The fighters rely on the UFC in order to do their business, and they have a dress code, they have a lot of rules. But if they’re getting paid as independent contractors, then they’re paying their own employment tax, and they may be entitled to a refund.”

    It’s not just a question of taxes, either. As independent contractors, fighters enjoy fewer protections than they would as employees. Their right to form a union isn’t protected. If they’re fired, they can’t seek unemployment benefits. An injury on the job doesn’t entitle them to workers’ compensation.

    By keeping fighters as independent contractors while heaping more and more restrictions on them, the UFC has managed to have the best of both worlds, according to Gary Ibarra, a manager who has represented fighters such as Cung Le and Ben Rothwell. (UFC representatives declined to comment for this story.)

    “(The UFC wants) the benefits of having employees, stuff like forcing the guys to wear uniforms, basically, which is an earmark of an employee,” Ibarra said. “But also when certain things happen that would be negatives, then, no, the UFC can say, ‘Hey, they’re independent contractors.’ That’s because, since the UFC has kind of gone unchecked, no one has forced them to adhere to one side or another.”

    Which is not to say that a legal challenge couldn’t be forthcoming.

    Recent years have seen several such challenges from workers who were long classified as independent contractors. NFL cheerleaders have successfully sued over their employment classification, and states like California have even enacted new laws to categorize them as employees. FedEx drivers have also brought successful cases, and drivers for ride-sharing companies like Uber and Lyft have also challenged their employment classification.

    Such a challenge for UFC fighters could come in several forms, according to Swartz, who said his firm has used different avenues to contest employment status.

    “Hiring a lawyer to help you seek overtime pay is one way to go about it,” Swartz said. “Another is to file a complaint with the Department of Labor, or with the IRS over employment taxes.”

    Fighters could also seek unemployment benefits after being cut from the UFC, or file a worker’s compensation claim, or seek protections to form a union. Attempts to take actions that their status as independent contractors forbids could be enough to force a decision, Swartz said, but the result and the process could vary depending on which body is asked to issue a ruling.

    “The National Labor Relations Board, their test is a little different from the IRS test, which is a little bit different than the Department of Labor test,” Swartz said. “But most of these tests, what they come down to is control and freedom. The way to look at it is, how much does the organization control these folks, and how much freedom do they have to run their own business? You need to look at the totality of the circumstances. Ask yourself, is this person in business for themselves, or do they rely on someone else whose rules they have to follow?”

    Ask UFC fighters, and they’ll tell you that they have no shortage of rules to follow outside the cage – and a variety of penalties waiting if they run afoul of those rules. Whether that makes them more than just independent contractors remains to be seen, but if that designation is ever successfully challenged it could have a domino effect that’s felt throughout the MMA world.

    link : http://mmajunkie.com/2017/08/ufc-fighters-employees-or-independent-contractors
     
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  2. Leone510 White Belt

    Leone510
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    Hmmm they have to sign a fight agreement before each fight and they have no work until assigned a fight so it sounds like a "contract"or to me
     
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  3. hot carl Silver Belt

    hot carl
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    Wholly wall of text batman.

    I've always thought they were employees for a variety of reasons.

    Ufc controls the vast majority of the factual matrix that is considered when an analysis of contractor vs employee is made.

    Exclusivity to UFC, control of when and where the work takes place, supplies uniforms and prohibits straying from the uniform policy, and a number of other factors, including limiting what fighters can and can't do on their own time (usada, fight week, etc) and the fact that the UFC can fire (terminate contract) the fighter at their discretion.

    In some cases, ufc has also provided the necessary things to do the work. Kelvin had a nutritionist that the UFC provided, some fighters have access to UFC training facilities, and so on.

    Many employees sign employment contracts, so the presence of a contract isn't always determinative.

    Compare a UFC fighter to a macdonalds employee and there is a great deal of overlap.

    Manager sets schedule
    Both provide uniforms that has to be worn
    Both like have non-compete/no moonlighting for competitor rule.

    That all being said, without seeing a number of UFC fighter contracts, it's tough to say what else might be in there.
     
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  4. TriangleMonkey Brown Belt

    TriangleMonkey
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    I bet the fine lines in a UFC contract hold them liable for a lot of that.

    Prob not the best contract to sign in combat sports, but its the premier league and fighters that seek that ultimate recognition must suffer.
     
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  5. Irishwhiskey119 MMArmy.com Owner

    Irishwhiskey119
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    Who cares?

    We get great fights. Stop trying to ruin the sport.
     
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  6. Aegon Spengler Silver Belt

    Aegon Spengler
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    They are almost certainly employees based on the exclusivity clause.

    If they can't contract elsewhere they are employees
     
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  7. Trojanlegal Orange Belt

    Trojanlegal
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    Ben has an agenda, as to most MMA media, regarding the UFC. I am a sports lawyer and find it odd Ben neglected to interview lawyers with a different perspective. Although the "fighters as an employee" argument is very valid and could be successful before a federal agency or court, the UFC has excellent legal arguments to demonstrate its fighters are independent contractors. It is not a clear cut case but Ben makes it seem that way. When I get some time, I will post some of them.
     
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  8. FedorGOAT Jones>Fedor

    FedorGOAT
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    Those fighters are human being, putting their bodies on the line for our entertainment. If we wouldn't care about their well being then who would.
     
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  9. Cooliox Gold Belt

    Cooliox
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    Modern day slave contracts,


    "take it or leave it"
     
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  10. vandymeer13 White Belt

    vandymeer13
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    Whatever gets rid of the fucking reebok uniforms
     
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  11. warriorscomeout Silver Belt

    warriorscomeout
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    A WWE wrestler is even more fucked than an UFC fighter. They belong to the WWE. They are not even employees, they're slaves to company. Everything they do including how they dress, speak, post online and who they sleep with is dictated by the company.

    An UFC fighter has to wear Reebok on fight night. Piss in a cup. Fight twice a year.

    A WWE dude wears exactly what they tell him to. Piss in a cup. Fight four times a week.

    Still McMahon has been able to keep them classed as contractors.
     
    #11
    Last edited: Aug 13, 2017
  12. ralphus1 bzzt gleep bop

    ralphus1
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    I've always wondered how in the eyes of the law they could sign an exclusive contract that prevents them from fighting elsewhere, yet still be considered independent contractors.
     
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  13. BenRichards Brown Belt

    BenRichards
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    If the conditions and treatment of their contractors/employees improves then the quality of the employees and product would most likely improve. We complain about the lack of depth and quality fighters in the bigger weight classes, don't we? Perhaps if they improve the quality of their employment maybe better athletes would consider making mma/UFC a career
     
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  14. Irishwhiskey119 MMArmy.com Owner

    Irishwhiskey119
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    Bullshit.

    The more you over analyze it the more it'll become a sport for pussies with headgear and instant stoppages. The sport is fantastic right now so just shut your trap and enjoy it.
     
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  15. Irishwhiskey119 MMArmy.com Owner

    Irishwhiskey119
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    They wouldn't piss on your burning bodies.

    They don't care about you and they are treated fine. They make money and have the freedom to do what every they want with their lives.
     
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  16. VulcanNervPinch Silver Belt

    VulcanNervPinch
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    In before a bunch of teenagers who are experts in labor law and know more than Scott Coker does about employment rush to defend the UFC.



    Well, before most of them, anyway.
     
    #16
  17. DaGenius Silver Belt

    DaGenius
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    Ufc has been killing fighters for years. Only sport where NFL and college players can look on and laugh at how "poorly you're treated with no leverage"

    And before y'all say it I know most fans don't care and I am in the minority
     
    #17
  18. Gambit MMA Orange Belt

    Gambit MMA
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    good article. all i know is that whole reebok deal was a big mistake and its a complete disaster. not sure what the hell they were thinking. you're already not paying them shit and then u tell them ur taking away the sponsors they have and they can only wear ugly ass reebok gear. id be suprised if their merch sales are doing well. those fighter kits are goddamn ugly
     
    #18
  19. egk Silver Belt

    egk
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    I've been saying for years on here that the UFC wants it's cake and to eat it too. They want total control over the fighters like they're employees. At the same time, when it comes to things like self-employment tax and health insurance, they're suddenly self-employed contractors.
     
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