March 18, 2008: 9:19 AM EDT
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March Madness: Are office betting pools illegal?

Before you submit your picks this year, keep in mind that your boss and co-workers may not be comfortable with betting at work.

By Anne Fisher, Fortune senior writer

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(Fortune) -- Dear Annie: I hope you don't think this is a dumb problem, but here goes: I recently got promoted to head of my department, after about four years with the company, and I love the job. Just one thing is making me a little uneasy, and that is the annual craziness that goes on here during "March Madness," the NCAA basketball championships.

Every year there has been a big office betting pool, with people spending huge amounts of time talking about their bets (and other people's), and this year is no different - except that a larger number of people than ever is now involved, and a team member just informed me that the amount of money at stake has gotten pretty substantial (about $5,000, he said).

Maybe it's just because I'm not a basketball fan myself, but I'm not comfortable with this. First of all, isn't sports betting illegal? If someone - say, a sore loser - complains to somebody higher up in the company (or God forbid, outside the company), what are the possible consequences?

I could ask everybody to please conduct the pool outside the office on their own time (for example, during lunch hours only), but they'd resent it and I don't want to start a new job on the wrong foot. So should I just look the other way, or what? I'd love to hear what your bloggers think about this. -No Spoilsport

Dear N.S.: Interesting question, considering that 19% of U.S. employees have participated in a March Madness pool, according to a poll by CareerBuilders.com. It's a bigger deal in some businesses than in others - 30% of financial-services workers are in on the betting, for instance, and 29% of salespeople. It's also more popular in the Midwest than in the rest of the country: 25% of employees in Midwestern states say they participate, compared to 22% in the Northeast, 18% in the South, and just 11% west of the Mississippi.

This year, get ready for an explosion of interest in NCAA games: CBS Sports, which broadcasts the games, is giving a wide variety of web sites permission to link directly to its live streaming video. So your employees will no doubt be tempted to watch online at NCAA.com, YouTube, ESPN.com, Yahoo!Sports, or Sports Illustrated's web site, SI.com. The live video will also be available on Facebook, at www.facebook.com/brackets.

Last year, about 1.4 million people watched the games online. This year, that number could skyrocket, since Facebook alone has 67 million users. But don't expect to catch anybody watching roundball on company time: The CBS platform on all the sites features a "boss button," which lets people switch the game off instantly when they see you coming.

So what, if anything, should you do about this tremendous drain on productivity? Most companies - including yours, it seems - have adopted an unofficial "don't ask, don't tell" policy of looking the other way. The general feeling is that the betting is harmless enough, and may even build a salutary spirit of camaraderie among co-workers, as long as nobody takes it too seriously.

Naturally, if you notice that someone is spending a truly counterproductive amount of time obsessing about basketball, "you certainly can sit that person down and say, 'Hey, this is fun, but don't let it interfere with getting your job done.' " says Steve Miller, a partner in the Chicago office of employment law firm Fisher & Phillips (www.laborlawyers.com).

It might also be a good idea to speak privately with the person or people in charge of the betting and advise them to keep the noise to a minimum. "You may have people on staff who have a moral objection to gambling and who are offended by these pools," Miller notes. "You have to be sensitive to that."

As for the legality of office betting pools, you're right: Betting on organized sports teams or events is illegal almost everywhere in the U.S. except Nevada and Atlantic City. But in practical terms, the risk of prosecution is almost nil. Your state attorney general's office has far more important things to do than go after March Madness pools.

"Even if a sore loser decided to call in the authorities, saying, 'I got cheated in my office basketball pool' or whatever, that is not nearly enough to start an investigation," says Steve Miller. "Alleging that the company is running a major booking operation, maybe..." But that's not happening at your shop, right?

So relax. Amid all the bad news these days, your underlings could probably use the chance to let off a little steam. And just think: In a couple of weeks it will all be over - until next year.

Readers, what do you say? Are you betting in a pool this year? How high are the stakes? Are March Madness betting pools harmless fun, or should companies try to discourage them? Post your thoughts on the Ask Annie blog. To top of page

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