Gambling in the Workplace: Should You Take One for the Team?

It’s that time of year again – March Madness is around the corner and employees are filling out their NCAA basketball brackets.  But are these bracket pools legal or appropriate for the workplace?  Such pools can increase camaraderie and team spirit in the workplace, but they can also significantly decrease productivity among the workforce and potentially lead to liability for an employer.  Here are 5 things to consider when addressing gambling in the workplace:

1. Social Gambling is Generally Legal in Maine

Social gambling is essentially gambling that nobody profits from (winnings are not considered profits), and generally includes the NCAA bracket-type pools.  Gambling ceases to be social and begins to turn criminal as soon as somebody turns a profit or a takes a cut for themselves.  In 2002 a middle manager at AT&T was arrested and prosecuted for taking a 10% cut in an office football pool.  The pool was advertised in office emails, and a coworker allegedly turned him in to the authorities.  The manager was charged with promoting gambling and faced up to 5 years in prison.

2. Employers May Prohibit Social Gambling

The federal government, for example, prohibits all gambling on federal government property if it involves (1) a game of chance, (2) consideration for the opportunity to play the game, and (3) a prize is offered.  This prohibition applies to all employees, the general public, contractors, vendors, and exhibitors.

The NCAA, as another example, opposes all forms of legal and illegal sports wagering.  It views wagering as having the potential to undermine the integrity of athletics and jeopardize the welfare of student-athletes.  Under the NCAA’s policy, certain employees involved with NCAA athletics, either employed by the NCAA or by an institution that participates in NCAA athletics, are prohibited from most forms of sports wagering, especially including NCAA basketball brackets and pools.

3. Be Wary of Gambling Addicts in Your Workforce

If an employer permits any form of gambling in the workplace, it should be aware that it may have employees who suffer, or have previously suffered, from a gambling addiction.  Gambling opportunities in the workplace are also relapse opportunities for the gambling addict.  The National Council on Problem Gambling estimates that 6-8 million Americans suffer from some sort of gambling problem and use the workplace as a shield to hide a gambling problem from family members.  Signs of this include excessive use of the telephone for personal calls or having credit card and loan bills mailed to the office instead of the employee’s home.  Over 60% of compulsive gamblers break the law to finance their gambling habits, including the employee in U.S. v. Severino, 1998 WL 911741 (D. Ill 1998) who embezzled money from his employer to fund his gambling addiction.

4. Gambling: the ADA, the MHRA, and the FMLA

Luckily, compulsive gambling is not recognized as a disability under either the Americans with Disabilities Act (ADA) or the Maine Human Rights Act (MHRA).  However, there have been cases where employees have claimed legitimate disabilities which manifest themselves in the form of compulsive gambling, and the outcome in these cases is less clear.

In one such case in Arizona, an employee claimed that he suffered from depression which manifested as a gambling addiction.  The employee was arrested for activities associated with his gambling, and his employment was eventually terminated.  The employee alleged that the employer had violated the ADA because it terminated his employment because of his depression.  The court, however, never reached the issue of whether the ADA applied because the employer did not know that the employee suffered from depression until after he was terminated.  Trammell v. Raytheon Missile Systems, 721 F.Supp.2d 876 (D. Ariz. 2010).

In another case in Virginia, a Verizon employee suffered from severe depression and anxiety and developed a gambling addiction.  The employee was granted intermittent FMLA leave to take time off to relieve his anxiety and cope with his depression.  During one of the FMLA leave periods, the employee’s supervisor discovered him at a casino in Atlantic City after he had called work that morning saying he was too depressed to come in.  His employment was terminated and the employee filed a claim alleging interference with his FMLA rights and that his trip to Atlantic City was part of an effort to “get away” to relieve his symptoms for his depression and anxiety.  The court agreed with the employer that the trip to Atlantic City was beyond the scope of his permitted FMLA leave.  Campbell v. Verizon Virginia, Inc., 812 F.Supp.2d 748 (D. Vir. 2011).

5. Gambling Policies

Remember, the best defense is a good offense! If an employer decides to utilize a specific gambling-related policy for its workplace, it should be careful to ensure that all employees are treated similarly.  Employers cannot randomly allow certain types of gambling while prohibiting others if it can be viewed as treating the underlying purpose differently.  Employers are encouraged to discuss parameters of gambling-related policies with counsel.