As I post this, we are minutes away from the official start of March Madness. So, as I do every year at this time, I will answer the question: Are office pools legal in California? As employment lawyers, is it our responsibility to wipe out another hallowed workplace tradition just like we did with binge drinking at office holiday parties?
In California, according to Penal Code section 337a, gambling can be a felony or a misdemeanor. But Penal Code section 336.9 creates an exception for betting pools between people who are not acting for profit, other than the same stakes available to every participant. The exception applies as long as the pool isn’t being run online and no more than $2,500 is at stake. This doesn’t make the pools legal. But instead of a potential felony, it’s an infraction and the maximum penalty is a $250 fine.
So are the pools illegal? Technically, yes. But if you don’t run it online, the person running it doesn’t take a cut, and you keep the amount under $2,500, your odds of getting in trouble are pretty small. Probably about as small as the odds of Kansas losing in the first round to Austin Peay. (Do their fans really chant “Let’s Go Peay”?)