For many youths, playing on a college sports team is a dream come true. However, the reality of collegiate sports isn’t always as glamorous as aspiring athletes believe it to be. For example, the governing body of college athletics, the National Collegiate Athletic Association (“NCAA), exercises tremendous control over student athletes’ lives. And the current laws allow the NCAA to benefit from college athletes without paying them. At the same time, the NCAA generates an incredible amount of revenue each year—to the tune of $1.14 billion in 2022—almost exclusively from the efforts of collegiate athletes.

This landscape has led many to believe that the current framework doesn’t allow collegiate athletes to be paid fairly for all the time, effort and sacrifice they make. In fact, some economists have referred to the NCAA as a “cartel.”

As mentioned in our previous post, a group of Division I athletes decided they had had enough and filed a federal employment lawsuit against the National Collegiate Athletic Association (“NCAA”) and several individual colleges and universities, including Villanova, Duke, and the University of Oregon. The student athletes claim that the NCAA should recognize student athletes as employees based on the level of control the NCAA exercises over their lives. If the student athletes succeed and they are held to be “employees,” the NCAA would be required to compensate the athletes according to the current minimum wage laws.

The Legal Landscape for College Athletes Appears to Be on the Cusp of a Major Change

For years, the complaints of college athletes who felt they’d been taken advantage of by the NCAA went unheard. However, more recently, there has been a wave of class action lawsuits against the NCAA that appear to be gaining traction. While college athletes used to not be able to receive any income for their personal brand, the United States Supreme Court unanimously took student athletes’ side in 20201. Now, collegiate athletes can derive income from their name, image and likeness (“NIL”).

The next group of NCAA class action lawsuits is focused on classifying college athletes as employees so they enjoy the protections of the Fair Labor Standards Act, which would require the NCAA to pay athletes at least the federal minimum wage. Given the current landscape, it appears that major changes surrounding the compensation of collegiate athletes are on the horizon. Former athletes

Why Doesn’t the NCAA Pay College Athletes?

The short answer to why the NCAA doesn’t pay college athletes is that, under current law, it doesn’t have to. But what allows the NCAA to get away with not paying athletes for the countless hours they devote to their sport?

The answer lies in the NCAA bylaws, which require collegiate athletes to be “amateurs” in order to participate in any sport. NCAA Regulations Bylaw 12.1.2 provides, “Athletes are stripped of their amateur status and thus their right to participate within NCAA sporting events if they receive payment for their athletic skills.” The NCAA’s proffered reason for the rule is that it ensures student-athletes are students first and should prioritize their education.

Bylaw 12.1.2 is reflective of the NCAA’s overall stance that athletes should not be compensated for playing college sports, whether it be limits on scholarships, restrictions on income-generating endorsements or refusal to pay athletes for their time.

However, there are a few reasons this logic breaks down. For starters, in order to secure a place on the team, have a successful season and increase their chances of a professional career post-college, student athletes devote most of their time to their sport. Of course, students are not the only ones demanding this level of dedication; colleges and universities expect student athletes to exhibit this level of commitment.

Add in the fact that the NCAA (as well as colleges and universities) generate billions of dollars off of college athletes, and the real reason the NCAA opposes paying college players becomes a bit more clear.

How Much Would Student Athletes Make if the NCAA Was Forced to Pay Them Fairly?

While every athlete’s training regimen and schedule vary, it is beyond question that if student athletes were paid, they’d earn a significant amount.

The NCAA places limits on the amount of time players spend attending games, practices, and team meetings, as well as other athletically related activities. Currently, student-athletes can dedicate a maximum of four hours per day, or 20 hours per week, during the season with one day off. During the off-season, the limit decreases to eight hours per week and two days off. Of course, not every sports-related activity counts towards this limit; most notably, travel time. However, even keeping this structure as it is, student athletes would still be able to bring in a significant income. As an example, let’s look at a NCAA basketball player.

During the Season Hours: 520

The college basketball season begins in November and goes through April. During the six-month season, players spend at least 20 hours per week, adding up to 520 hours.

Off-Season Hours: 208

Between the months of May and October, players dedicated 8 hours per week, totaling 208 hours during this six-month period.

Total Yearly Hours: 2,912

Adding in-season and off-season hours together gives you a total of 728 hours. Assuming a four-year college sports career, that’s 2,912 hours.

There is no agreed-upon rate that college players could demand. But even taking the federal minimum wage of $7.25 as an example, athletes could earn $21,112. Of course, once the door opened to college athletes being eligible for wages as employees, the natural forces of the market would almost certainly mean that most athletes would command a significantly higher rate of pay. For every dollar per hour more than $7.25 an athlete is paid, it translates into almost $3,000 over the course of their college sports career.

The Wave of Lawsuits Against the NCAA for Refusing to Pay Collegiate Athletes

The wave of lawsuits against the NCAA over its refusal to pay college athletes marks a critical juncture in the history of American collegiate sports. For decades, the NCAA has operated under an amateurism model, arguing that college athletes should not be paid because they are amateurs and not professionals. This stance, however, has faced increasing scrutiny and legal challenges, particularly as the revenue generated by college sports, especially football and basketball, has skyrocketed.

One of the core arguments against the NCAA's policy is based on the ideals of fairness and equity. As collegiate sports have evolved into a multi-billion-dollar industry, there's a growing sentiment that athletes, who are the primary drivers of this revenue, deserve a share of the profits. This is especially the case considering the rigorous training schedules, significant risk of injury, and the stringent restrictions on personal endorsements and other income-generating activities imposed on these athletes.

Until recently, legal challenges against the NCAA’s policy not to pay athletes have primarily focused on antitrust laws. Athletes have argued that the NCAA's rules on compensation violate antitrust laws by effectively capping athletes' earning potential and limiting competition. These lawsuits have gained traction, with courts increasingly questioning the NCAA's justification for its amateurism rules.

In 2021, a landmark case, NCAA v. Alston, saw the Supreme Court unanimously ruling that the NCAA’s restrictions on “education-related benefits” for athletes violated antitrust laws, setting a precedent for future legal battles.

However, more recently, the focus has been on the NCAA’s refusal to classify student athletes as “employees” under the Fair Labor Standards Act. Enacted in 1938, the FLSA is a federal law that establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards affecting full-time and part-time workers. The primary goal of the FLSA is to protect workers against unfair pay practices. However, the FLSA only applies to “employees.” Thus, if student athletes were deemed employees, the FLSA would require them to receive fair payment for the hours they worked.

Earlier this year, the U.S. Court of Appeals for the Third Circuit heard the case Johnson v. NCAA, which was brought by former Division I athletes against the NCAA and several member institutions. In this lawsuit, the former students claimed that the FLSA requires the NCAA to classify student-athletes as employees and to pay them at least the federal minimum wage for every hour they spend training or playing a college sport.