3.19.25
By Jennifer Jacobus, PHRca, SDEA CEO 
As March Madness approaches, many workplaces buzz with excitement over office pools and friendly wagers. While these activities can foster camaraderie and engagement, HR professionals and small business owners must navigate the legal and ethical considerations—especially in California, where gambling laws are strict.
California has some of the toughest gambling laws in the country. Under California Penal Code Section 337a, betting on sports, including office pools with entry fees, is generally illegal. However, free-to-enter pools with non-cash prizes are typically permissible. The key legal considerations include:
- No Entry Fees — If participation requires money, it could be considered illegal gambling.
- Skill vs. Chance — Games of pure chance, like March Madness brackets, fall under gambling laws.
- No House Profit — Employers or organizers should not take a cut of any winnings.
Despite legal limitations, March Madness pools and similar activities—when structured properly—can bring teams together. Here’s how:
- Boosts Employee Engagement: A friendly competition encourages participation and creates excitement.
- Strengthens Team Bonds: Employees across departments interact and connect over shared interests.
- Improves Morale & Productivity: A little workplace fun can break up routine and enhance job satisfaction.
How to Keep It Fun and Legal
HR professionals can encourage team bonding without crossing legal lines by:
- Hosting a free-to-enter bracket challenge with company-branded prizes.
- Turning it into a team-building activity (e.g., friendly debates on game picks).
- Encouraging a charity donation format, where employees participate for a good cause.
March Madness can be a great way to build camaraderie, but businesses must ensure compliance with California’s strict gambling laws. By focusing on fun, inclusive, and legal alternatives, HR leaders can create an engaging and legally sound workplace tradition.
Remember SDEA is part of your team. If you have questions on this or anything else, please do not hesitate to call us, we are just a phone call away: 858-505-0024.
