Gracy Bhattacharya*

The esports industry has witnessed an exponential rise in its popularity and generated colossal amount of revenue in recent times. In addition to the booming market, the organised nature of esports involving teams, coaches, professional players, franchises and massive fandoms have placed competitive gaming at par with traditional sports. Although the industry is at its nascent stage, questions have been raised about the contractual terms and labour laws concerning professional esports players. Through this piece, I seek to explore the possibility of classifying professional esports players as employees of their respective game publishers in the Indian paradigm.

Introduction

In this era of technological revolution, the traditional understanding of work and employment has been disrupted by the growth of unconventional career opportunities. One such form of unconventional employment generation can be found in the esports market. Electronic sports, popularly known as esports, refers to video gaming in an organised and robustly competitive setup. Although esports serves as a favourite pastime for a wide section of population, its enormous revenue generation and economic impact which is equivalent if not greater than that of traditional sports, has commercialised esports into a large scale industry. The meteoric rise of esports is also palpable in India. In view of the rapidly growing esports market, the Indian government recognised it as a “multisport event” alike conventional sports disciplines under the aegis of Ministry of Sports and Youth Affairs. However, the esports ecosystem is grappling with issues of temporary employment relationship, absence of collective bargaining agreements, short career span, occupational health hazards and overall instability. Resultantly, there is a pressing need to safeguard the rights of professional esports players under the labour laws of their respective countries.

This essay seeks to address the predicament of professional esports players in India by analysing whether they can be categorized as employees of their respective video game publishers. In doing so, I examine the Riot Games’ League of Legends (“LoL”) as a case study. Part I analyses the structure and working of esports competitions. Part II briefly explains the applicable tests in the Indian paradigm to determine the employee status of individuals. Part III seeks to address whether professional LoL players qualify as employees of their game publisher. Through Part III’s analysis, I conclude that the players are employees of Riot Games and should be entitled to the benefits and protections granted to employee.

I. Workings of Esports Competitions

Esports competitions are a collaboration of broadly five kinds of actors, namely game publishers, video games platforms, tournament organisers, players and fans. Publishers invest in the marketing and development of video games, and are distinct from game developers. Developers create video games and generally assign their intellectual property rights to publishers, who in turn provide funding. Video games platforms aid in installation and distribution of video games through their hardware or online platforms. Tournament organisers run both amateur and professional esports competitions in accordance with the terms fixed by publishers. However, multiple esports tournaments are conducted by publishers themselves. For instance, the publisher of LoL, Riot Games, organises its tournaments and leagues. Players denote both professionals hired by esports teams to compete in national and international competitions as well as amateurs. Finally, the humongous viewership of esports is attributable to enthusiastic fans who form communities around competitions, teams, players etc.

Professional LoL involves not only teams and players but also its publisher and the league, LoL Championship Series (“LCS”). LCS is LoL’s professional esports league and its rules which are published every season, regulate the conduct of teams and players in accordance with player agreements and Riot Games’ End User License Agreement between them. LoL Championship Series LLC, a subsidiary of Riot Games, is the owner of LCS. Given LCS’s sheer proximity with Riot Games, it is deemed as an alter ego of Riot Games. In this essay, Riot Games’ regulations are treated as LCS regulations.

The essay focuses on addressing the employer-employee relationship between Riot Games and professional LoL players respectively. It is pertinent to underscore that professional LoL players possibly work as employees of their teams who provide remuneration and exercise significant control over them. It however, does not militate against the strong influence of publishers over the gaming contract between players and their teams. Hence, I determine the employment relationship between professional players and their respective publishers.

II. Determining Employer-Employee Relationship

Traditionally, employee is determined through the extent of control of employer over the nature and manner of the work performed by employee. This is known as the test of control and supervision wherein the master would not only tell the employee what work is to be done, but also determine the manner in which it needs to be completed. However, the Supreme Court in Dharangadhara Chemicals Works Ltd. recognises the need to go beyond the control and supervision test. Owing to the complex nature of work in some kinds of employment, the master cannot always direct the manner in which the work is to be done and the employee may exercise his discretion to perform the work. Hence, the test does not govern the manner in which the work is done, but the extent of control exercised by the employer over the employee in performing the work. Thereafter, the Court in Silver Jubilee observed that the control and supervision test would not applicable in cases of skilled employment. In view of complexities in the nature of work, the Court referred to Montreal v. Montreal Locomotive Works[1] which upheld the need to apply a mix of tests involving control, ownership of the tools, chance of profit, risk of loss to determine the relationship between the parties. Further, the Court quoted Lord Denning in Bank Voor Handel stating that the test of being a servant does not rest nowadays on submission to orders.Considering the changing nature of work and skill requirements, the Court propounded the organisation test wherein the Court emphasised the need to assess whether the services being provided by the worker are important and integral to the business in order to qualify as an employee. In this light, it must be noted that the 2021’s landmark ruling of the UK Supreme Court in Uber BV wherein it held that Uber drivers are workers and not independent contractors marks a paradigm shift in the traditional understanding of the meaning of the term workmen in contemporary times. Furthermore, the Court in Silver Jubilee made reference to U.S. v. Silkto apply the economic reality test to distinguish employees from independent contractors. The test involves several factors such as degrees of control, opportunities of profit or loss, investment in facilities, permanency of relations and skill required in the claimed independent operations. Borrowing from the economic reality test of US v. Silk, the apex court in Hussainbhai established the economic control test. The Court underscored the importance of taking into consideration the “raw social realities” of workers and their economic dependence on the employer. As a result, the employer has economic control over the workers’ subsistence, skill, and continued employment. This test applies when workers are economically dependent on the enterprise even in the absence of a direct relationship between them. Moreover, in Nilgiri Cooperative the Court adopted an integrated approach to establish whether the employee was fully integrated into the employer’s concern, or remained apart from and independent of it. The multiple factors employed by the Court include who is the appointing authority, who is the pay master, who can dismiss, the nature of the job, nature of establishment, and many more. The multifactor test was also used Balwant Rai wherein the Court considered factors such as who has authority to take disciplinary action, dismiss workers, pay remuneration, to ascertain employer-employee relation.

III. Whether Professional Lol Players Are Employees Of Riot Games?

Riot Games, publisher of LoL, indirectly regulates the employment conditions of players through their teams. This can be evinced through the rules of LCS which require players to be paid at the start of new season, provide medical aid and 401(k) retirement plans and subject them to disciplinary actions in case of misconduct or infringement of LCS rules. Additionally, Riot Games decides the locations for conducting LoL events and provide tools and equipment which have to be mandatorily used by players. The necessary tools and materials provided by LCS include personal computers, headsets, microphones, personal computer mice, mousepads, microphones, tables and chairs. The game client provided by LCS also must be compulsorily used by players to perform anything related to professional LoL game. Moreover, the discretion of LCS in imposing penalties in the form of fines, suspensions and bans suggests the high degree of control LCS has over the conduct and activities of LoL players.

Given Riot Games’ intellectual property rights over LoL, it strictly controls the relation between sponsors and players. It directs what teams and players should wear or promote during the game, which equipment to be used and what advertisements must be played. Thus, the control exercised by Riot Games on players goes beyond their work with the league. Further, the association of LCS with players and their teams could attain permanency provided players maintain their high level of play.

Notwithstanding the other sources of income of players through activities like streaming, the guaranteed source of remuneration for professional players comes from their team and LCS. Players may enhance their income by competing in and winning tournaments or decrease income by finishing last or being removed from the LCS. Resultantly, players may see a rise or drop in pay based on their ability to perform. Thus, players have limited role in securing profit or risking loss as they entirely depend on LCS.

Applying the organisation test and multifactorial approach of Silver Jubilee and Nilgiri Cooperative, it can be concluded that professional players are employees of Riot Games as it determines the payment, provides benefits, controls the management conduct of players; instructs where the work is to be performed and supplies the necessary equipment to be mandatorily used by players to carry out the work; severely restricts the players’ opportunity to manipulate their profit and loss in the game; and, develops a permanent relation with its teams and players on account of teams’ high-level performance. Unequivocally, Riot Games, the alter ego of LCS, exerts significant control over players though not direct in nature but equivalent to that of an employer over employee.

Furthermore, while determining employment relationship, the economic control of employer over employee needs to be assessed as laid down in Hussainbhai. The young age (around 15 or 16 years) of players while entering into temporary contractual relations with teams is indicative of the economic reality of players who rely on their league organisers for guaranteed income and employment. The professional LoL players substantially depend on LCS for their livelihood in exchange for playing in the league which requires a full-time commitment for extensive training, developing team strategies and dynamics to excel in the game.

Therefore, by applying the tests of employer-employee relation in the Indian paradigm, professional LoL players can be regarded as employees of their game publisher, Riot Games.

IV. Conclusion

Esports, though a fast-growing industry, is still in its infancy. A major predicament plaguing the esports ecosystem is the applicability of existing laws to an industry which was not contemplated at the time of writing them. The current contractual framework fails to protect the rights of professional players. The primary issues concerning employment are balanced work schedule because players are made to practise an average of fifty hours per week; post retirement plans as professional gamers have a short-lived career due to stress, poor reflexes, health concerns etc.; absence of collective bargaining; instability. As established that professional LoL players are employees of their game publishers, the employee status would entitle the players to collective bargaining rights and strive for more equitable and just terms in “player agreements”, ensuring improved conditions of work. Certainly, recognition of employee status of professional LoL players by Riot Games would have far reaching consequences on the trajectory of esports in future.

[1] Montreal v. Montreal Locomotive Works Ltd. [1947] 1 D.L.R. 161.

*Gracy Bhattacharya is a 3rd year Law student at the West Bengal National University of Juridical Sciences.