Nike and the Power 5 College Player’s Safety: Watch Out for the Locomotive

On October 4, 2014, Washington State quarterback Conor Haliday passed for more yards in a game (734) than any other quarterback in NCAA history. During his career, he had NCAA records for the most passing completions (59) and attempts (89) in one game. But in late October 2014, 290-lb Southern Cal All-American Leonard Williams fell across Haliday’s leg, causing compound fractures so severe that Haliday’s promising career was over.


This wasn’t Haliday’s only injury: two years earlier, he was speared in the chest by a Utah lineman; causing a 9-centimeter liver laceration – the kind of injury most commonly seen only after a gunshot wound or car accident — and spent four days in intensive care.

His injuries occurred while playing in uniforms and shoes bearing the Nike logo. The NCAA’s ‘amateurism’ system has long been fueled by a number of Big Lies, but one of the biggest is that such player display of Nike (or other) logos is ‘Not-Promotion’. This deception, which inures to Nike’s substantial benefit, since its ‘promoter’-players require none of the employment-related benefits which Nike must pay to its other 5,300 U.S. employees, is exposed by Nike’s own promotion-contract with universities, which states that such logo-display is the “essence of the agreement” and a “bargained-for material benefit.”

Overseas Contract Partners —  Domestic Contract Partners 

Nike no longer makes shoes or apparel; instead, it enters into contracts to purchase them from overseas “contract factory partners.” Nike enters into a second set of contracts, to buy promotional services here in the U.S. Some are contracts to create and buy TV or online advertising. Some are big-dollar endorsement contracts with ‘professional’ sports celebrities. And some are entered into with their U.S ‘contract factory partner,’ Power 5 universities, to purchase promotion services performed by student-players.

Some two decades ago, public pressure to eliminate exploitative working conditions and pay in Nike overseas factories triggered Nike to make sustainability-based improvements aimed toward ‘greener’ production methods, more stakeholder engagement, data-based decision-making, and new worker-protection benchmarks. And in 2015, Nike committed to a campaign for continuous improvements, described in its 100-page “Sustainability Policy,” and a four-page “Code of Conduct.”

This Nike campaign for greater environmental and human sustainability will come, Nike asserts, from its commitment to one basic tactic: disruption. “Evolving and disrupting change” will “transform beyond the foundation of compliance,” and “piloting new approaches, supporting transformational causes [and] collaborating to create systemic change,” will help generate “new compensation and benefit models,” and improvements in the “health and well-being” of the laborers who work in overseas factories. Compliance with its 2015 Nike Code of Conduct, according to Nike, “is non-negotiable.”

Nike’s Non-Existent Commitment to ‘Health and Well-Being” of Its Player-Promoters

This Nike commitment might be ‘non-negotiable,’ overseas but, as regards the protection of athletes who perform promotion at Nike’s U.S. ‘promotion factories’ (the universities), it is non-existent. Nike may, as it claims, have “worked alongside others for over 20 years” to improve labor standards in its overseas ‘contract factories,” but it has done no work to similarly improve benefits and protections for the college players who promote for Nike.

In fact, because of what I call the players’ Big Insurance Hole, college players who promote here for Nike need new protections and benefits just as much, if not more than, workers in Nike’s overseas factories. This Hole is created by an unconscionable shortcoming in the “benefit model” applied to today’s Power 5 player-promoter: the schools’ refusal to pay for what I call “Full-Tail” player health and disability insurance. Full-Tail covers the entire risk of injury to which players are exposed, by insuring all reasonably-related medical and disability costs connected to that injury. It is hardly unique; in fact, Full-Tail auto coverage means that the insurance carrier for the driver who plows you down in the pedestrian cross-walk must pay for all medical, rehab and other costs which are causally related to the injury.

This Big Insurance Hole throws the vast majority of Power 5 Revenue players into an absurd “Bring-Your-Own” [BYO] insurance back alley: the player’s own coverage is primary, and the school’s ‘fills-in’ the gaps. (And if the school provides primary coverage, it usually lasts only one year post-injury or, at most, one year post-graduation.) As a result the player is commonly left, like Washington State’s Conor Haliday, with no health or disability coverage after that one-year post-injury period.

NCAA Devil-May-Care Attitude re: the Player-Promoter’s Big Insurance Hole

The NCAA’s devil-may-care attitude about this Big Insurance Hole is illustrated in this 2015 exchange between NCAA VP Oliver Luck, and an audience member at Texas A&M:

Questioner: What would you say to a player like Connor Haliday who was . . . a record-setting passer and . . . was a ‘for-sure’ draft pick . . . forced into retirement after going undrafted in the NFL draft? What do you say to a player like him, it’s just too bad?

Luck: No, I would say to him that its a shame that he broke his leg, you know injuries are a part of sport, they’re impossible to completely avoid. But I would encourage him to make sure he has his degree and has a plan for his life . . . and to take out of his athletic career those values that will help him . . in the future. . . . That’s why its so important for us to focus young men and women on education, that’s what going to make a difference in their lives.”

Luck most likely procures his own personal homeowners, auto, disability and health insurance (some or all of the costs of which may be paid by his employer) and, in his former role as West Virginia athletics director, Luck (along with actuaries and other experts he likely consulted), oversaw the pricing and arrangement of millions of dollars of property, casualty, health, workers’ compensation, disability and other business-loss insurances, all meant to cover risks attendant to the operation of that athletic department. And many of the WVU employees injured – physically or financially – as a result of the risks covered by those insurances were likely told that their injury or loss was “a part of” the athletic department’s business, and that “it was a shame” that the loss was suffered. But none, most likely, were ever also told that no insurance – or only Tiny-Tail — coverage had been retained by WVU to insure their loss — and that, as a result, they should “make sure [they have] a degree and a plan for life.”

The player touted by the NCAA and school as both student and athlete is, for insurance purposes, treated as only a student – even though he encounters repetitive high-stakes risk. “Injuries,” Oliver Luck asserts, are “a part of sport,” but the de facto impact of his response, and the Big Insurance Hole, is that “injuries are a part of sport, but insurance is not.” This is long-outdated 19th-century risk management, the kind evident in the warning commonly posted back then at railroad crossings: ‘Watch Out for the Railroad Crossings.” It is human non-sustainability, which turns the player into promotion-industry effluent.

Power 5 School Position: Insurance R Not Us

The modern AD assumes that there is no need to insure his player-asset against the entire risk of loss. This is not loss control; it is an expense-avoiding ‘Insurance R Not Us’ shifting of financial burden to the player, who is left owning much of his own risk of injury. In fact, the school manifests more insurance concern for almost any of its other inanimate assets – buildings, autos, and even income-streams – than it does for its players, and violates a basic tenet of modern business loss control: if you cannot entirely eliminate a risk, at least fully insure for it. The school’s refusal to provide Full-Tail health and disability insurance needs to be labeled for what it is: barbaric.

“Barbaric? – Us?,” might be Nike’s likely response, followed by an excuse: “Talk to the universities – we don’t own or control them!” But Nike’s own sustainability policy states that “the majority of [Nike’s] environmental and social impacts – as well as [its] biggest opportunities – occur in operations [it does] not directly control, but influences.” Overseas, then, mere Nike ‘influence’ – not ownership – is used to ‘disrupt’ practices. Despite having similar, if not greater ‘influence’ upon its U.S. ‘promotion factories’ at each university, Nike has done no such ‘disruption’ here.

Where’s Nike in the New Era of Player Sustainability?  – Freeloading

A new era of college player sustainability is emerging, with no thanks to Nike. Nike’s “fundamental values” may “remain the same,” as CEO Mark Parker asserts, and none may, as Parker further contends, “be more important than contract factory workers who are valued and engaged.” And Nike may have “worked alongside others for others for 20 years to improve labor standards in contract factories” overseas.

But Nike has been AWOL regarding labor standards, or basic injury protection, for the minion-players who do their promotion here in the U.S. It’s time for Nike to apply some domestic, home-grown disruption of the Big Insurance Hole tolerated by almost all of its U.S. promotion factories which use player-promoters,’ to force those universities to disrupt and “innovate to deliver better solutions that benefit athletes, the company, and the world.”

Until it does, Nike’s de facto message to former player-promoters like WSU’s Conor Haliday, and all current Power 5 players who encounter daily risk of injury, is not, as Nike’s Policy claims, “Sustainable Innovation is a Powerful Engine for Growth.” It is ‘Watch Out for the Locomotive.’

Copyright 2016 William Wilson

About brewonsouthu

lawyer, with interest in college sports and NCAA oversight and decisions, and sports generally.
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