PHILADELPHIA (AP) — College athletes whose efforts primarily benefit their schools can qualify as employees earning compensation under federal wage and hour laws, a U.S. appeals court ruled Thursday, in a setback for the NCAA.
The court, in the last challenge to the long-standing notion of “amateurism” in NCAA college sports, said a test should be developed to differentiate between students who play college sports for fun and those whose efforts “cross the legal line into work.”
“With professional athletes as the clearest indicator, playing sports can certainly constitute compensable work,” wrote U.S. Circuit Judge L. Felipe Restrepo. “Ultimately, the question remains whether the cumulative circumstances of the relationship between the athlete and the college or the NCAA reveal an economic reality that is that of an employer-employee.”
A colleague, in a concurring opinion, questioned the difficulty of such a process, noting that about 200,000 students compete on about 6,700 Division I teams. The NCAA hoped to have the cold casebut instead it will return to the trial judge for fact-finding.
The decision follows a 2021 Supreme Court ruling that led the NCAA to change its rules to allow athletes to profit from their name, image and likeness. In May, the NCAA announced a near US$2.8 billion revenue sharing plan this could direct millions of dollars directly to athletes next year.
The Division I athletes and former athletes behind the lawsuit in Philadelphia are seeking more modest hourly wages, similar to those earned by their counterparts in work-study programs. They argue that colleges are violating fair labor practices by not paying them for the time they dedicate to sports, which they say can average 30 hours or more per week.
Attorney Paul McDonald, representing the plaintiffs, suggested that athletes could earn $2,000 a month or $10,000 a year for participating in NCAA sports. He said many students need money for day-to-day expenses.
“This notion that college athletes can’t be both students and employees is simply not correct when you have student employees on campuses,” McDonald said Thursday. “The idea that athletes would not meet the same criteria as employees is unbelievable.”
A district judge refused to dismiss the case, prompting the Indianapolis-based NCAA to ask the appeals court to block the case from going to trial. The three-member panel heard arguments in February.
Defendants include the NCAA and member schools including Duke University, Villanova University and the University of Oregon. An NCAA spokesperson did not immediately return messages seeking comment Thursday.
O unanimous decision of the Supreme Court which generated the NIL payments lifted the ban on university remuneration beyond full scholarships. Schools that recruit top athletes can now offer tens of thousands of dollars in education-related benefits, such as study abroad programs, computers and graduate school scholarships.
“Traditions alone cannot justify the NCAA’s decision to build a massive money-raising enterprise at the expense of student athletes who are not fairly compensated,” Justice Brett Kavanaugh wrote in a concurring opinion. “The NCAA is not above the law.”
But that case did not resolve whether college athletes are employees entitled to direct compensation — the main question before the 3rd U.S. Circuit Court panel.
Baylor University President Linda Livingstone, speaking at the NCAA convention last year, said this model would turn coaches into their players’ bosses.
“Turning student-athletes into employees will have a broad, surprising and potentially catastrophic impact on college sports overall,” said Livingstone, chairman of the NCAA Board of Governors. “We need Congress to affirm the unique relationship student-athletes have with their universities.”
But the relationship has faced increasing scrutiny.
In 2021, a prominent lawyer for the National Labor Relations Board said in a memo that College athletes should be treated as school employees.
And the players have taken to social media to advocate for a cut of some of the hundreds of millions of dollars NCAA schools earn from sports, including a campaign on the eve of the 2021 NCAA basketball tournament that carried the hashtag #NotNCAAProperty.
The NCAA, at its convention, compared the athletes to students who perform in theater groups, orchestras and other campus activities without pay.
McDonald said these types of college groups are student-led, while athletes have their time controlled by their coaches in a way that resembles employment.
“The most controlled kids on any campus are the student-athletes,” he said earlier this year.
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This story has been corrected to show that Baylor University President Linda Livingstone’s cited remarks at the NCAA convention occurred last year, not this year. The spelling of Livingstone’s surname has also been corrected.
