Quick Hits

• Employers considering hosting NCAA bracket pools should be aware of state gambling laws, as the structure of these pools could potentially classify them as illegal gambling.
• Sweepstakes, as free-to-enter contests, may face fewer legal concerns, but businesses must still comply with specific state regulations that govern such promotional activities.

Millions of Americans will fill out brackets for the NCAA Division I Men’s and Women’s college basketball tournaments, often called “March Madness,” and enter bracket pools and contests. Some businesses may consider hosting a bracket pool of their own, and they may also want to use the contest to encourage certain behaviors, such as donations to a particular charity, overtime work, or collecting contact information for potential new customers or clients, by making such an action a requirement to enter the pool.

However, beyond employee distraction and productivity concerns, businesses operating bracket pools or similar contests/promotions may face potential legal risks under state gambling and sports betting laws and regulations. Here are some considerations for employers.

Gambling Laws

While some state-to-state variations exist, state laws generally prohibit or restrict gambling and other games, such as raffles, sweepstakes promotions, and contests. In general, states may find a game or contest to be illegal gambling when there is (1) consideration required to enter (Consideration), (2) an element of chance...

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