The Legal Impact Resulting from Labeling Student-Athletes as Employees
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By: Domenica Tomasetti* Posted: 11/24/2021
There have been a lot of eyes on the National Collegiate Athletic Association (“NCAA”) as newly implemented laws are poised to change the perception of collegiate sports.[1] In 2021, in National Collegiate Athletic Association v. Alston[2], the Supreme Court held that college athletes would no longer be restricted from benefiting from their name, image, and likeness.[3] Thus, Alston opened up the rights for student-athletes to profit from sponsorships and the ability to team up with companies eager to have collegiate athletes promote their brands.[4]
NCAA’s Alston Argument and the Results of Its Failure
In Alston, the NCAA argued that allowing college students to benefit from their name, image, and likeness would take away the separation between the students and professional athletes.[5] Essentially, any change allowing them to be paid would take the amateur status away from the players and teams.[6] Nonetheless, the NCAA’s arguments did not stand, and the Supreme Court established the opportunity for collegiate athletes to profit.[7]
Now, well into college football season and the start of basketball season, college stars are signing with agencies and beginning to see the profits their universities have been benefiting from for years.[8] In addition to the team goals of winning championships and individual goals, both players and coaches now have agencies and sponsorships to navigate through for the first time.[9] However, with this new potential for earnings comes questions on the legal status of these student-athletes.[10]
NLRB Addresses Proper Label for Student-Athletes
On Sept. 29, the National Labor Relations Board (“NLRB”) issued a memo that will shift how college athletes are classified.[11] In her memo, general counsel for the NLRB Jennifer Abruzzo addressed the public with a statement that college athletes are considered employees under the National Labor Relations Act (“NLRA”) and are entitled to the full protections available to employees.[12] The assertion made by Abruzzo provides legal advice and standards to guide future events if and when a case with the NLRB does arise.[13] Specifically, labeling collegiate athletes as student-athletes rather than employees will be considered a violation of §8(a)(1) of the NLRA.[14] Furthermore, general counsel stated, “The freedom to engage in far-reaching and lucrative business enterprises makes players at academic institutions much more similar to professional athletes who are employed by a team to play a sport.”[15] Collegiate athletes have always been participants in lucrative business enterprises.[16] However, before Alston, they did not see the profits made by those business enterprises – their universities and the NCAA profited instead.[17] While not every student will see an influx of cash, the top athletes in the largest and most successful programs are anticipated to make approximately $2 million each year.[18]
Statutory Protections of the NLRA Afforded to Employees
In 2015 the National Labor Relations Board dismissed a case brought by a group of NCAA football players at Northwestern, thereby declining to characterize student-athletes as employees under the National Labor Relations Act (“NLRA”).[19] Now six years later, this newly released legal memorandum by the NLRB deviates from that precedent.[20] With employee status, these athletes would fall under all statutory protections provided by the NLRA of 1935.[21]
Various other statutory protections include the right to strike and the right of employees to choose their representatives.[22] In addition, the NLRA provides protections for protected concerted activity, which includes the option for employees to come together and protest the terms of their employment.[23] Therefore, these provisions open the door to potential collective bargaining agreements for players.[24] Specifically, athletes at these universities will have the option to collectively bargain and negotiate for better working conditions without fearing retaliation by their schools or the NCAA.[25]
NCAA Responds to the Characterization of College Athletes as Employees
The NCAA released a statement that it would like college students to not be considered employees but rather continue to be labeled “student-athletes.”[26] It wants to prevent the universities’ students from being afforded all of these statutory protections, including unionization.[27] However, if the NCAA looks at previous cases banning player unions that it considered successful, the organization may realize that what was once successful may no longer be legal.[28]
Looking Ahead
The NCAA has gone through a significant number of changes in the past two years, and these changes continue to make an impact.[29] Next, colleges and states will need to craft new guidelines that adapt to the evolving law.[30] For now, the NCAA must wait to see how the fact that athletes now have proper representation and a new label unfolds.
*Staff Writer, Jeffrey S. Moorad Sports Law Journal, J.D. Candidate, May 2023, Villanova University Charles Widger School of Law
[1] See Zach Braziller, NCAA Changes College Sports Forever: ‘An entirely new landscape’, N.Y. Post (June 30, 2021), https://nypost.com/2021/06/30/ncaas-new-nil-rule-changes-everything/ (discussing impact recent legal changes to NCAA rules will have on college sports).
[2] Nat’l Collegiate Athletic Ass’n v. Alston, 141 S. Ct. 2141 (2021).
[3] See id. at 2166 (deciding college athletes should no longer be prevented from profiting from name, image, likeness).
[4] See Gregory A. Marino, NCAA v. Alston: The Beginning of the End or the End of the Beginning?, Foley & Lardner LLP (Aug. 5, 2021), https://www.foley.com/en/insights/publications/2021/08/ncaa-v-alston (discussing possible financial implications of Supreme Court’s decision in NCAA v. Alston).
[5] See Alston, 141 S. Ct. 2141, 2152 (2021) (“The NCAA ’s only remaining defense was that its rules preserve amateurism, which in turn widens consumer choice by providing a unique product—amateur college sports as distinct from professional sports.”).
[6] See Dennis Dodd, Classifying College Athletes as Employees, NLRB Memo Sets Stage for Further NCAA Destabilization, CBS Sports (Sept. 29, 2021), https://www.cbssports.com/college-football/news/classifying-college-athletes-as-employees-nlrb-memo-sets-stage-for-further-ncaa-destabilization/ (discussing possible implications of NIL, newly released memo by NLRB).
[7] For further discussion on the Supreme Court’s decision in Alston and its impact to college athletes’ earning potential, see supra note 2 and accompanying text.
[8] See Tommy Beer, These NCAA Athletes Have Already Inked Endorsement Deals, Forbes (July 1, 2021), https://www.forbes.com/sites/tommybeer/2021/07/01/these-ncaa-athletes-have-already-inked-endorsement-deals/?sh=5dd97e604676 (listing some athletes who have already signed endorsement deals, identifying companies).
[9] See Amanda Christovich, Big East Basketball Coaches’ Views on NIL, Front Office Sports (Oct. 25, 2021), https://frontofficesports.com/big-east-basketball-coaches-views-on-nil/ (providing discussion from some coaches on potential impact of NIL, plan to navigate new territory).
[10] For further discussion on the legal status of student-athletes following the decision in Alston, see supra note 6 and accompanying text.
[11] See N.L.R.B. Gen. Couns. Mem., GC 21-08, Statutory Rights of Players at Academic Institutions (Student-Athletes) Under the National Labor Relations Act, (Sept. 29, 2021) [hereinafter NLRB Memo], available at https://apps.nlrb.gov/link/document.aspx/09031d458356ec26 (explaining student-athletes should be considered employees, receive all protections afforded by NLRA).
[12] See id. (“[I]t is my position that the scholarship football players at issue in Northwestern University, and similarly situated Players at Academic Institutions, are employees under the Act. I fully expect that this memo will notify the public, especially Players at Academic Institutions, colleges and universities, athletic conferences, and the NCAA, that I will be taking that legal position in future investigations and litigation under the Act.”); see also Glynn A. Hill, College Athletes Can Now Earn Money and Other Benefits. Are Unions Next?, Wash. Post (Sept. 30, 2021), https://www.washingtonpost.com/sports/2021/09/30/nlrb-memo-ncaa-college-athletes-employees/ (describing NLRB’s role in enforcing labor protections for employees).
[13]See Michael McCann, College Athletes are Employees, NLRB Counsel Says, Sportico (Sept. 29, 2021), https://www.sportico.com/law/analysis/2021/nlrb-college-athlete-memo-1234641056/ (providing legal advice to classify student athletes as employees in order to be afforded labor protections to be involved in concerted activity, participate in strikes, engage in collective bargaining). For further discussion on the relevance of the NLRB Memo, see supra note 11 and accompanying text.
[14] See NLRB Memo, supra note 11 at 1-2 (discussing statutory violations for referring to players as student-athletes rather than employees).
[15] See NLRB Memo, supra note 11 at 6.
[16] See Mark J. Drozdowski, Ed.D., Do Colleges Make Money From Athletics?, Best Colleges (Nov. 16, 2020), https://www.bestcolleges.com/blog/do-college-sports-make-money/ (providing information on how much money some colleges make from their athletic programs).
[17] See id. (showing how much money goes to universities rather than athletes).
[18] See Tommy Beer, NCAA Athletes Could Make $2 Million a Year if Paid Equitably, Study Suggests, Forbes (Sept. 1, 2020), https://www.forbes.com/sites/tommybeer/2020/09/01/ncaa-athletes-could-make-2-million-a-year-if-paid-equitably-study-suggests/?sh=51f297615499 (discussing profits college athletes could see each year in top programs).
[19] See Daniel Wiessner, U.S. Labor Board Dismisses Northwestern Football Players’ Union Bid, Reuters (Aug. 17, 2015), https://www.reuters.com/article/us-usa-football-northwestern/u-s-labor-board-dismisses-northwestern-football-players-union-bid-idUSKCN0QM1Q620150817 (discussing NLRB’s decision in 2015 that student-athletes should not be characterized as employees, not afforded protections under NLRA, including ability to unionize).
[20] See NLRB Memo, supra note 11 at 1 (explaining that title “employee” will afford student-athletes statutory protections NLRB denied them in 2015).
[21] See 29 U.S.C. §§ 151-166 (1947); see also NLRB Memo, supra note 12 at 9 (discussing protections to be afforded to college athletes under the NLRA with characterization “employee”).
[22] See 29 U.S.C. §§ 151-166 (1947) (showing statutory protections for employees under NLRA to choose their own representatives, ability to go on strike).
[23] See id. (listing other statutory protections for employees under NLRA that should be afforded to college athletes).
[24] See id. (providing elements of NLRA).
[25] For further discussion on what the label employee means for athletes, see NLRB Memo supra note 11 and accompanying text.
[26] See Steve Berkowitz, College Athletes Are School Employees, New National Labor Relations Board Memo Says, USA Today (Sept. 29, 2021), https://www.usatoday.com/story/sports/college/2021/09/29/nlrb-memo-says-college-athletes-school-employees/5915491001/ (discussing NCAA’s response to memo issued by NLRB).
[27] See 29 U.S.C. §§ 151-166 (1947) (providing statutory protections of NLRA).
[28] Nw. Univ., 362 NLRB 1350, 1356 (2015) (“[E]ven if the scholarship players were statutory employees (which the Board does not here decide), we have concluded that it will not effectuate the policies of the Act to assert jurisdiction in this case.”); see also NLRB Memo, supra note 11 at 2 (footnote omitted) (discussing Nw. Univ., 362 NLRB 1350).
[29] For an example of recent changes impacting NCAA schools and players, see supra notes 1-2 and accompanying text.
[30] Braziller, supra note 1 (“[T]here are the states where laws haven’t passed yet. Schools in those states can come up with their own NIL rules and guidelines under the parameters set by the NCAA.”).
