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Posted: March 22, 2011

Beware March Madness

It can be problematic for employers

Todd Fredrickson

Employers are usually leery of employees spending company time on issues that aren't directly related to the job. This is especially true of activities that may open the employer to liability issues. Many employers are in a quandary at this time of year with the approach of "March Madness," the annual college hoops bonanza that sees millions of people filling out brackets and obsessing over matchups -while employees use company resources to enter online office pools, blog about the top seeds and watch live streaming games.

To add to the intrigue, the issue of "gambling" at work was in the news a few months ago when financial powerhouse, Fidelity Investments, fired several workers for taking part in a fantasy football league. While a Federal Appeals court ruled that fantasy football does not constitute gambling, employees should be aware that Fidelity was well within its rights to dismiss the employees for using company resources and time to participate in an activity that was not work-related.

Here are some factors for employers to consider now that the annual college basketball bonanza is upon us once again:

• Lost productivity is the primary consequence of any workplace gambling situation - and this is exacerbated by the huge buzz around "March Madness." If you notice that an employee or employees are spending an inordinate amount of time filling out brackets or obsessing about the tournament, request that they do so outside of work hours.

• Allowing betting can open business owners and managers up to unexpected legal problems since office pools are almost always illegal, no matter how small the amount involved.

• Employers should decide what exactly their policy is on pools/gambling - and make this known to all employees. If an employer allows staff to participate in a pool, the company cannot take any of the funds from the pool. And the pool must be strictly voluntary.

• Owners & managers should not set up pools themselves to avoid disgruntled employees complaining that the boss is forcing them to do something illegal.

• While Colorado has not seen many legal problems around "March Madness," be aware that employers have been embroiled in lawsuits in other states.

• Remember that someone setting up a pool and collecting money is tantamount to soliciting at work - employers who have a non-solicitation policy should be aware of this. By permitting employees to solicit at work, even one time, you risk liability later if you try to enforce a non-solicitation policy; for example when the union representative wants to solicit your employees.

• Many people are unaware of the prevalence of gambling addictions in the general populace. Workplace gambling can exacerbate such problems for employees with gambling addictions.

• Bear in mind that Vault.com, the online recruiting company in New York, published a survey estimating that about 37 million of the nation's 140 million workers have participated in NCAA. pools. And "March Madness" is estimated to cost employers $1.7 billion in lost productivity.
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Todd Fredrickson is managing partner of the Denver office of Fisher & Phillips LLP, representing employers across the country in labor, employment, civil rights, employee benefits and immigration matters. He can be reached at 303-218-3660 or tfredrickson@laborlawyers.com

Todd Fredrickson is managing partner of the Denver office of Fisher & Phillips LLP, representing employers across the country in labor, employment, civil rights, employee benefits and immigration matters. He can be reached at 303-218-3660 or tfredrickson@laborlawyers.com

Enjoy this article? Sign up to get ColoradoBiz Exclusives. The opinions expressed in this article are solely that of the author and do not represent ColoradoBiz magazine. Comments on articles will be removed if they include personal attacks.

Readers Respond

This time of year a lot of people comment about the lost productivity and cost to employers that March Madness causes. What's never mentioned, nor calculated, is the value of bringing everyone together in a fun group activity such as a voluntary office pool. Does the camaraderie that's form while bantering back and forth about a basketball game not contribute to greater productivity throughout the year? And doesn't having a little bit of fun at work improve worker morale? By Nathan Jansch on 2011 03 22

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