Graduate students at Columbia University count as employees under federal labor law and may now vote to unionize, the Democrat-controlled National Labor Relations Board ruled Tuesday.

The ground-breaking 3-1 decision has major financial and academic implications for private colleges and universities across the United States, home to more than 500,000 graduate students. It’s also a major boon to organized labor at a time when membership has been declining for years.

The NLRB deals exclusively with private-sector disputes. In 2004, it effectively blocked graduate students at private colleges and universities from organizing, writing in its Brown University decision that grad students “have a primarily educational, not economic, relationship with their university.”

In its ruling Tuesday, however, the NLRB reversed the Brown decision, claiming that it had “deprived an entire category of workers of the protections of the (National Labor Relations) Act without a convincing jurisdiction.”

Until now, private universities have often provided stipends, health care coverage, tuition waivers and other benefits to graduate students; instead of treating them as salaried employees, the universities have argued that they are still students gaining an education and work preparation.

When graduate students organize, it can saddle universities with a major financial burden.

New York University is among the only private institutions to allow its grad students to organize—and in 2002, when it reached its first labor agreement with its newly unionized grad students, labor costs increased by more than 50 percent in the subsequent four-year period.

Some of those increased costs will likely result in higher tuition costs for incoming students.

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