March Madness: Could Friendly Wagers Among Employees Put Your Organization At Risk?

Date   Mar 19, 2015
The American Gaming Association estimates that Americans will wager $9 billion on the NCAA tournament, more than double the estimated $3.9 billion bet on the Super Bowl, bringing March Madness to a whole new level.

Executive Summary: The American Gaming Association estimates that Americans will wager $9 billion on the NCAA tournament, more than double the estimated $3.9 billion bet on the Super Bowl, bringing March Madness to a whole new level. Of that amount, only about $2 billion will be bet legally. See Estimated 40 million to fill out brackets, Many of the illegal wagers will be made through the ubiquitous office pool. March Madness, Super Bowl, and Fantasy Football pools have become so ingrained in the American workplace that most view them as harmless. In fact, while arguing in support of legislation that would amend Pennsylvania's small games of chance law to include small monetized pools conducted by individuals, Pennsylvania state senator Lisa Boscola pointed out these pools are so common one was even being circulated on the Senate floor at that time. See Pa. legislators battle state police over Super Bowl betting pools, Boscola introduced the legislation after state police seized funds collected for Super Bowl pools by two volunteer fire departments and a social club in Pennsylvania, claiming the pools violated the federal Professional and Amateur Sports Protection Act (PASP).

While a police raid over an office betting pool is unlikely, the situation highlights one of the potential risks employers may face when they permit office sports pools. Other risks range from loss of productivity to discrimination and disability issues. Newly allowed online gambling can also create headaches for employers and IT departments. Before turning a blind eye or participating in the pool, here are a few risks with which employers should become familiar.

  • Illegal Moves – Gambling at work is illegal in many states and resides in a legal gray area in others. Further, with more employers operating in multiple states and more employees working remotely, office betting pools may span state lines and may violate federal law.
  • Blowing the Whistle – Because gambling is illegal, employers should also watch out for employees who "blow the whistle" on activities such as an employer's betting pool and then claim retaliation.
  • Impact on Productivity – Although there is no legal liability, employees watching ball games during work hours can reduce productivity and potentially impact your bottom line. Further, just a few employees streaming games on work computers can significantly slow your network, impacting other employees.
  • Employee Morale – While some managers believe office pools are good for employee morale, be aware that some employees may object to them. An employee who objects to gambling on religious grounds may bring a hostile work environment claim if co-workers – or worse, supervisors – harass or ridicule the employee for not participating in the pool.
  • Disability – While the Americans with Disabilities Act (ADA) specifically exempts gambling addiction from its coverage, an employee with gambling problems may suffer from other medical conditions, such as depression or mental illness, which may be covered by the ADA or state law. Compulsive gamblers may have other problems at work, such as borrowing money from co-workers, being distracted from work, and attendance problems.

Online Gambling: An All-Season Pastime

Three states, New Jersey, Delaware, and Nevada, have approved online gambling, while several others are considering measures that would legalize or expand online gambling in some form. Online gambling permits individuals to gamble from anywhere, even their smart phones. Employees may attempt to gamble on work time or from their employers' computers. The shift to online gambling is likely to create issues for employers, who may have turned a blind eye to Super Bowl pools or NCAA brackets, but must now decide how to address gambling year round.

The Best Defense is a Good Offense

If employers decide to take a chance on employee betting, they should institute clear policies. The policy should:

  • state that gambling is illegal;
  • describe acceptable and prohibited behaviors;
  • state that employees can be disciplined for violating the policy; and
  • identify all work areas where betting is prohibited, including offices, cafeterias, and parking lots.

Employers should also include a mechanism for employee complaints and be prepared to handle them in the same way as any other complaints. Enforcement of the policy is key. Employers face a greater chance of liability when they have a policy but do not enforce it fairly.

Employers' Bottom Line:

Employers should be wary of turning a blind eye to workplace gambling, including bracket pools. Depending on state laws, employers who choose to allow gambling at work should institute policies defining acceptable and unacceptable behavior and should discipline violators. The Employment Law360 article, Know Your Risks Before You Make Your Bracket,, (subscription required) written by the author of this Alert, Salvador Simao, provides a more detailed discussion of the risks of office betting pools.

Additionally, FordHarrison has prepared a survey of state social gambling laws, which is available on the Knowledge Center page of our web site. If you have any questions about the survey or the issues addressed in this Alert, please contact Salvador Simao,, or the FordHarrison attorney with whom you usually work.