Do the National Collegiate Athletic Association’s (NCAA’s) rules on student-athlete pay violate federal antitrust law? The U.S. Supreme Court will consider a case this term asking that question.
The NCAA is challenging a 9th U.S. Circuit Court of Appeals decision holding that the association and other athletic conferences can’t cap education-related compensation for the Division I football and basketball players who filed the lawsuit.
The high court is expected to hear oral arguments early next year and issue a decision by June.
We’ve rounded up resources and articles from SHRM Online and other trusted outlets on the news.
Providing Education-Related Benefits
The Supreme Court decided NCAA v. Board of Regents more than 35 years ago, finding that rules on eligibility standards for college athletes are subject to a less stringent standard than most antitrust cases. However, the 9th Circuit recently ruled that the NCAA’s limits on providing education-related benefits violate federal antitrust laws. Such benefits include computers, equipment, post-graduate scholarships and paid internships. The NCAA and other athletic conferences asked the Supreme Court to weigh in on the matter.
Altering College Sports?
The NCAA argued that the 9th Circuit’s ruling “will fundamentally transform the century-old institution of NCAA sports, blurring the traditional line between college and professional athletes.” The athletes argued, however, that the athletic conferences are actually seeking antitrust immunity. The 9th Circuit’s instructions “apply only to NCAA restrictions on education-related benefits that schools may offer Division I basketball and FBS football players benefits such as computers, science equipment, musical instruments, postgraduate scholarships, tutoring, study abroad, academic awards, and internships,” the athletes said.
Some Lawmakers Support Paid Endorsements
Some state lawmakers have been asking the NCAA to allow student athletes to receive direct compensation for the use of their names, images and likenesses. In response, the NCAA said it will allow student athletes to receive some endorsement money beginning in the 2021-2022 school year. Federal lawmakers have also showed interest in the issue, as some congressmembers are considering legislation to set new federal rules for intercollegiate sports.
California Gov. Gavin Newsom signed a bill in 2019 permitting college athletes in the state to be paid for endorsements and sponsorships. “Colleges and universities reap billions from these student athletes’ sacrifices and success but block them from earning a single dollar,” Newsom said.
College Athletes Not Deemed Employees
The case before the Supreme Court involves antitrust laws and education-related benefits. The 9th Circuit has ruled in the past, however, that the NCAA and the Pac-12 Conference (a collegiate athletic conference) don’t have to pay a college football player minimum wage and overtime premiums. A proposed class action claimed that the NCAA and the Pac-12 acted as joint employers by “prescribing the terms and conditions under which student athletes perform services.” The appeals court, however, said that based on the economic realities of the relationship, the football players were not employees under the federal Fair Labor Standards Act. “Within the analytical framework established by the Supreme Court, the NCAA and Pac-12 are regulatory bodies, not employers of student-athletes under the FLSA,” the 9th Circuit said, upholding a district court’s ruling.