The total athletics revenue reported among all National Collegiate Athletic Association (NCAA) athletics departments in 2019 was $18.9 billion. Between ticket sales, contracts with athletic apparel brands, broadcasting rights, and corporate sponsorships, this number represents various revenue streams. Yet despite all the money that universities and coaches enjoy (many who earn seven figures), student athletes are mostly left out.
Some argue that student athletic labor is offset by the benefit of scholarships. While Division I and Division II schools provide many student athletes with scholarships, they typically do not cover full tuition and costs for students. Further, the scholarships are a mere fraction of what the university makes of off a student athlete’s talents.
Aside from their lucrative salaries, many professional athletes are able to make money by licensing rights to their name, image, and likeness. However, college athletes are restricted from doing so, as NCAA guidelines specifically prohibit students from receiving pay for competing in a sport. The NCAA further states, "You are not eligible in any sport if, after collegiate enrollment, you accept any pay for promoting a commercial product or service or allow your name or picture to be used for promoting a commercial product or service."
However, many state governments, noting the inherent unfairness with the status quo, have enacted statutes that allow student athletes to profit off of their name, image, and likeness. Over 20 states have signed such a bill into law, with many more following suit. As a result, the NCAA has stepped back from its original stance.
The Supreme Court recently addressed this issue in the case National Collegiate Athletic Association v. Alston (No. 20-512). In a unanimous ruling, the Court rejected the proposition that the NCAA is immune from federal antitrust law. The ruling overturns those NCAA rules that cap the amount that schools can pay student athletes for education-related benefits. Justice Kavanaugh’s concurrence noted that “the NCAA’s business model would be flatly illegal in almost any other industry in America” because “[n]owhere else in America can businesses get away with agreeing not to pay their workers a fair market rate on the theory that their product is defined by not paying their workers a fair market rate.”
I think Justice Kavanaugh hit the nail on the head when he identified student athletes as “workers.” Just as many students work for the university they attend—in a lab, in the library, or as a resident advisor—and are employees who receive fair and reasonable pay, so too are student athletes. If we apply the factors identified by the Department of Labor for identifying an employee, student athletes clearly should be considered employees, and thus be paid fair market wages.
It will be interesting to see what changes the NCAA will implement in light of the recent Alston ruling and the changing state laws.