The second thing you need to realize about yesterday’s NLRB ruling

… is that it’s a ginormous wake up call for the NCAA.  Andy Staples summarizes that nicely when he writes,

Ohr ordered an election during which Northwestern players will vote by secret ballot to decide whether they wish to unionize. They may choose not to do that, which would help the NCAA and the schools maintain the business model they’ve built and fiercely protected. Northwestern could win its forthcoming appeal to the NLRB, which also would help. This case probably won’t get resolved before it reaches the Supreme Court or Congress, so nothing drastic will happen immediately.

The O’Bannon case is slated to start this summer, and any judgment there will be appealed to the hilt. It won’t be resolved for years, but it also could smash the business model for major college athletics to pieces. Earlier this month, sports labor specialist Jeffrey Kessler announced he would form a class of athletes to sue the NCAA and the ACC, Big Ten, Big 12, Pac-12 and SEC on antitrust grounds. Kessler isn’t seeking specific damages. He simply wants to blow up the system and start over with a free-market one.

One or all of these challenges will ultimately succeed because the people in charge of college sports didn’t heed the old saw about what happens to pigs and what happens to hogs. The conference commissioners, athletic directors, coaches, and NCAA officials have had a great run of about 15 years in which their revenues have soared while their labor costs remained mostly flat. A lot of that money went into their pockets. And bless the $4 million football coach or the $1 million athletic director. They were only being good capitalists. It’s great that Ohio State athletic director Gene Smith negotiated a contract on the open market that pays him a $940,484 base salary and includes bonuses such as the $18,447.94 he’ll receive because Buckeyes wrestler Logan Steiber won the NCAA title in the 141-pound class this past weekend. It kind of stinks that Steiber doesn’t get a penny extra even though he threw some significant scratch in his AD’s pocket.

If Smith makes $150,000 a year and gets no bonus, no one holds him up as an example. The difference is the money, and not many of these folks have turned it down. But if they believed they could be millionaire CEOs without dealing with some of the same labor issues other millionaire CEOs deal with, they were kidding themselves.

The irony of using Gene Smith as a poster boy is that Gene Smith recognizes the current state of affairs is untenable.

Ohio State AD Gene Smith calls the approval of the extra money a ‘formality,’ despite failed efforts in the past, because the power conferences will likely have voting prowess to push through such issues.

None of this will stave off the Ed O’Bannon lawsuit, which could put the NCAA on trial in June over athletes’ inability to monetize their image and likeness. Notable attorney Jeffrey Kessler has joined the fray, filing an antitrust suit against the NCAA attacking what many consider an an antiquated ‘amateurism’ model.

But Smith wonders whether the recent governance push – which should amplify the players’ voice in the process and enhance health-safety benefits – could have helped curb the lawsuits if done earlier.

“Had new governance structure been in place four years ago, I don’t think these lawsuits would have emerged because we would have addressed a lot of these concerns,” Smith told CBSSports.com last week (yes, before this).

Since the NCAA never wanted players capitalizing on market value, maybe at least some level of litigation was inevitable.

But to Smith’s larger point, being proactive with players’ needs would have urged more dialogue and common ground.

Now it’s almost too late.

Like with player health care: Smith thinks, once governance is done, broader discussions will surface about better health benefits after players’ eligibility is up. This is issue No. 1 for the Northwestern players in their fight to unionize.

Letting students in “allows us to move to the 21^st century,” Smith said. The power conferences don’t want weighted voting to increase scholarship limits or change academic criteria — they want to use financial wealth to “more support the student-athletes we have,” he said.

“I’m anxious to pull some of our student-athletes in a room and say, OK, this new governance structure is in place, we’re going to start talking about potential student legislation for student-athlete benefits, guys, tell me, what do you need that you’re missing?” Smith said.

The judge in the O’Bannon case has encouraged settlement talks for both sides, which Smith thinks is a great idea. “I just think it needs to be done,” he says.

What does it say when the guy who negotiated himself a bonus based on an individual player’s accomplishment is being more realistic than the NCAA’s chief legal counsel?

As Staples’ notes, commercially speaking, the world around the NCAA has changed.  The NCAA stubbornly refuses to recognize that.

Back in the 1950s, when former NCAA director Walter Byers coined the term “student-athlete” in order to help schools dodge worker’s compensation claims, there was little money in the system. Lawyers could have attacked but would have found only a few drops of blood in the stone. In his 1997 book Unsportsmanlike Conduct, Byers described a case in Colorado in which the state supreme court overturned a death benefit awarded to the widow of Fort Lewis A&M player Ray Dennison, who died of a head injury suffered playing football. Unlike today’s players, whose tuition, room and board are covered by their schools, Dennison was given a job to cover his room and board. “…the Supreme Court reversed the Industrial Commission’s award of death benefits to the widow because, it said, there was no evidence of a contract for hire or that his employment by the university would have changed had he quit football,” Byers wrote. “Particularly significant was the court’s argument that the college received no benefit from Dennison’s activities, ‘since the college was not in the football business and received no benefit from this field of recreation.'”

That was probably true of that school in the 1950s or a Division III school now. But at the top of the college sports food chain, schools are very much in the business of football and men’s basketball. Only a fool would argue that Texas A&M received no benefit from the exploits of Johnny Manziel. In fact, the schools of the Big Ten and the Pac-12 are so deep in the business of football and men’s basketball that they partner in (Big Ten) or run (Pac-12) their own cable television networks. In August, the schools of SEC — in partnership with ESPN — will join them when their own network launches. School presidents and athletic directors chose to turn college sports into a multibillion-dollar business. In fact, they sued the NCAA for the right to do it. This made some coaches, ADs and conference commissioners quite rich, and they pocketed a lot of that money before some enterprising attorneys began hinting to the labor force that it should ask for a bigger slice of the pie. Those attorneys didn’t do this out of the goodness of their hearts, of course. The ones who will ultimately win this game are the lawyers.

The world has changed, indeed.  The NCAA – okay, its big school membership – wants to have its commercial cake and eat its amateurism standard, too.  The problem is, sooner or later, the courts aren’t going to let it continue to do that.  So if you’re Donald Remy, do you advise trying to cut a deal now and manage the situation, or do you continue to claim disappointment, let things potentially fall completely out of control and then turn to Congress (as Jim Delany mentioned doing last month) to salvage things?

The answer seems pretty obvious to me.  But, then again, I’m not Mark Emmert.

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UPDATE:  To put things another way,

People have asked why the NLRB thinks athletes should be employees, and that’s a fundamental misunderstanding of the process. The NLRB isn’t sating football players should be treated like employees. They’re saying that football players ARE employees. The NCAA has been hiding for years behind the theory that because these kids are “student-athletes” (a term the NCAA made up to avoid liability), the normal rules don’t apply. Yesterday’s ruling was a pretty clear indication that those arguments are crap. You have an industry that makes huge amounts of money. You have a labor force that is highly skilled, drawn from a very narrow pool, and that spends more than a full time job worth of time on the job. The company’s income is largely based on the performance of the workers. They are under the complete (and damn-near dictatorial) control of their supervisors. And they are compensated to the tune of $50,000 to $75,000. And you ask people to believe they aren’t employees because you created a useful fiction that lets everyone sleep better at night? Shove it, sir. Shove it hard. When you see the facts on paper, it’s impossible to reach any other conclusion without adding some external consideration; “but think of what it will do to the game?”

We tend to let a lot of things slide because we love sports so much. We like physical sports, so law enforcement doesn’t get involved when a player come up behind a guy from behind, knock him out cold, and whack him in the neck with five foot long wooden stick in front of 6,000 witnesses. We enjoy the NCAA football video games, so we played along with the amusing theory that Michigan’s quarterback just happened to be #16 for a few years. We even try to talk ourselves into the idea that maybe football isn’t as dangerous as it’s being made out to be. But with yesterday’s ruling, at least we can say that the legal system can still see through Mark Emmert’s steaming fiction.