Debating NCAA Student-Athlete Payment | Public Forum

0:00 concept as to whether or not a seat your employees and then we’ll look at some of the practical considerations in determining whether or not going forward athletes really should student athletes in college really should be considered employees of their universities and colleges so without further ado the Fair Labor Standards Act was it’s a federal statute that was adopted in 1935 and it applies to whether or not somebody is an employee it requires employers to pay their employees a fair wage so there’s a federal minimum wage just like every state has a minimum wage and under that statute you have to you have to be paid

0:46 for whatever work you provide it also governs overtime pay if you work more than 40 hours a week you’re required to get time and ass and if if employers are not paying that and they’re not following the guidelines and that’s when you know people can recover for the work that they perform so in the concepts of student athletes as employees they have not previously been considered employees but as you can imagine with the growing revenue in this field particularly in the last you know 20 years or so with TV contracts and you know more fan engagement more merchandise the industry has grown to billions and billions of dollars worth of revenue being generated

1:31 in the college landscape and as part of that college athletes have seen the impact that they have on the revenue that their schools are able to bring in and they want you know a portion of that so they’re starting to question whether or not they can be considered employees and therefore be paid compensation for that so for athletes for student-athletes to be considered employees under the Fair Labor Standards Act they would have to demonstrate that they have performed work for an employer and they would have to gain status as an employee there’s the definition of employees not very how oh it’s just somebody who’s an employed by an employer which obviously doesn’t

2:17 tell you very much but the way that courts usually look at this is they look at what they call the totality of the circumstances and try and determine whether or not the individual is acting in an employment type relationship so for that though you should we’ve looked at what the nature of the relationship is is between the parties if there’s a contract involved what type of work is being performed what hours are being work there are a number of different factors that will be looked at by a court and trying to determine whether or not somebody is actively engaged as an employee and some courts have termed it

3:02 the economic reality test and that means that really it’s again just comes back to whether or not somebody is under the totality of circumstances they take a look at all of those factors and try and determine you know whether or not truly somebody is acting as an employee so in terms of recent decisions there have been in the last year-and-a-half three different court cases where individuals have sued the NCAA and their various college or university or a number of colleges and universities to try and gain recognition as employees under the Fair Labor Standards Act in

3:49 the first it’s referred to as Berger versus the National Athletic Association the NCAA that was in the Seventh Circuit and that was decided just at the end of last year in December under that you had three Pennsylvania track-and-field athletes women who were complaining that they should be considered employees under the Fair Labor Standards Act there they tried to analogize themselves to work study performers so you have a another college student who works in the library for instance you know they’re helping students do research they’re checking out books and

4:35 they get paid for that so according to the student athletes they are performing the same type of functions they are performing non-acid up non-academic functions for non-academic credit and the school is receiving a benefit from that they get the benefit of having you know student athletes come in and be part of their workforce and you know there’s there’s no academic tie into that so therefore they that’s worth that they’re performing and they should be paid for that the court ultimately decided against the students in that case they looked at again the totality of the circumstances and they said that for two main reasons that the student athletes

5:22 were not employees the first was that there is a what they called a revered tradition of amateurism in college athletics so for years and years and years college athletes have not been paid for participation in sports and because of that students accept scholarships and in play in college without any expectation of being compensated for that because nobody previously has been compensated for that so that was the first reason and the second reason was they looked at the the school itself Pennsylvania University which doesn’t offer any athletic scholarships or academic scholarships and they said that you know for

6:08 generations people have been coming to Penn without any expectation that they would be compensated for participating in sports because the school doesn’t even offer athletic scholarships you know there’s no sight been provided so therefore these students could have had could not have had any expectation that they would be compensated when they came and participated in intercollegiate athletics so those were the main two reasons why the court in that case decided that the main benefits were for the students and not necessarily or the school they were looking at who the primary beneficiary was where students participating in college athletics mainly for themselves or were they participating mainly for the

6:54 benefit of the school in this case because they went without any expectation that they would receive anything in return the the court found that it was mainly for themselves somebody asked the question about do most colleges have both types of scholarships it depends both most Division one schools have both athletic and academic except for your Ivy League schools most of the Ivy League schools do not have athletic scholarships some of them have academic scholarships but not all of them do there are other conferences that are similar the Patriot League which you know has Holy Cross Boston University and some of the other who view themselves as kind of similar

7:40 to the Ivy League’s but it’s a different conference they similarly do not have athletic scholarships in most instances but you know sometimes you can get an athletic scholarships so it really depends on the school and the division of intercollegiate athletics if as you go down tiers to Division two in Division three most of the time you’re not going to see athletic scholarships but you can receive academic support so it really just depends one other thing that the court cited in the bragger case or Berger case that really played a part in in determining whether or not they were going to consider student athletes to be employees there was that the

8:26 Department of Labor has written what’s called the field of operations handbook and in that it lays out a number of definitions of things that are considered work and are not considered work and and people who are performing certain functions and whether or not they would be considered employees and in that handbook they specifically set aside intercollegiate athletics as not meeting the definition for work performed and that students participating in extracurricular activities were not employed so that definitely played against the student-athletes who challenged the NCAA in court because you had the Department of Labor who is seen as kind of the authority in determining

9:12 who and who are not who are and who are not employees coming out in saying that these types of persons those participating in intercollegiate athletics are not employees and the type of activity that they participate in is not work there have been a couple of other recent cases one it was Dawson the verse the NCAA that case was in the ninth circuit out in California that was decided in April of this year the arguments largely followed the case that was made by the athletes at Pennsylvania University except it was meat made on behalf of student athletes participating

9:59 in division 1 football a revenue based sport which we’ll get into a little bit later how that how that plays into it and might impact decisions later on down the line and ultimately the Ninth Circuit just mimicked the decision of the Seventh Circuit and decided that in regardless of the fact that the individuals were participating in significant revenue generating sports they’re still not considered employees under that the Fair Labor Standards Act and largely for the same reasons it’s the previous case that case also had some questions about you know specific law in California that aren’t really important here but was also

10:46 denied on those grounds and then there just last month there was another case filed lyvers v to NCAA and in that case student athletes are trying to get pretty smart here and keep trying to distinguish themselves to see if ultimately they can get a win in court but in this one the the student-athlete challenged the NCAA on behalf of those students who are participating in revenue-generating sports and also receive a scholarship and we’ll get into a little bit later the reasons why that case came up and

11:31 why the decision in that case might be pretty interesting because there was an appeal in that Seventh Circuit case and in a concurring opinion by one of the judges where they ultimately agreed with the decision by the court but they had some interesting commentary as part of their decision that may have played into this future this later case here so some of the relevant other relevant decisions that are impacted here they’re not necessarily tied to the Fair Labor Standards Act because it’s that’s a very discrete area of the law but there’s also some other cases out there that have dealt with the National National Labor Relations Board in challenging

12:19 whether or not students meet the definition of an employee under under that and there’s also the case in the Seventh Circuit where the concurring opinion by one of the judges and the Breyer case noted that ultimately the reason that he voted against the student athletes in that case was because again they were on scholarship they they weren’t they were in non revenue-generating sports so they weren’t really providing any sort of profit to the school in fact they were probably just taking away from the school’s profits because most sports other than football and then some discrete sports based on different

13:05 schools they cost more money than they bring in so in that case the judge said that you know if if he were to rule in favor of the student athletes in the Brecker case then we you know musicians artist other other people who are other students that participated in similar extracurricular activities could also argue that they were employees and should be compensated for their you know the art that they created or the music that they created at the time they spent on their activity but he did know that his decision may have been different if the student-athletes were participating in a revenue-generating sport so in case

13:52 you’re not aware the manger revenue-generating Sports for Division one schools are football and men’s basketball most of the other sports again except for in rare circumstances such as women’s basketball at Connecticut or probably women’s soccer at North Carolina where they have really a really successful and long history of winning and a lot of support most other sports other than those two they don’t generate any revenue for the school and they actually just take away from the profits at the school and game so because that judge in that case noted that his decision may have been different if it was on behalf of

14:41 students participating in a revenue-generating sport ultimately that’s why this new case has come out in the same district we’re now a student athlete is challenging that you know he’s he’s on behalf of all student athletes on scholarship participating in revenue sports because he’s trying to see whether or not he can get a favorable decision from the one judge and then others who would be on the panel with him so again people you know student athletes are getting very knowledgeable about the cases that are out there they’re getting very creative and they’re trying to chip away and chip away at the definition of employee and see if they can’t gain some traction

15:26 there another case not necessarily a court case but another issue that’s important here is the situation that occurred starting back in 2014 at the National Labor Relations Board so if you’re not aware in 2014 members of the northwestern football team the captain and the quarterback Cain Colter brought a petition the National Labor Relations Board to unionize the members of his football team and ultimately the NLRB decided that football players were employees and

16:12 they did so because Coulter and his other plaintiffs argued that they were providing the school with the benefit they were being compensated in the form of their scholarship and they were subject to control of Northwestern University in the way that they did that is if you think about all the time that student athletes put into their aircraft so they spend more than 40 hours a week working on athletics going to practice going to games you know film study weightlifting whatever it may be they are prohibited from certain activities so for instance when I was an athlete I

16:59 wasn’t allowed to go scheme they are not allowed to enter certain majors because of the time constraints it just doesn’t work with their schedule and there are other things in terms of the after meet a specific GPA they have a curfew there were a number of aspects of the student athletes life that were subject to control of their coaches in Northwestern University so there because of all of those and because they were generating revenue and being compensated through their scholarship the NLRB found that they were employees that ultimately was appealed by Northwestern University and

17:46 it would to the whole panel of the board who decided not to hear the case it’s a little discreet of an issue but they didn’t hear the case because there are only about ten or so maybe a little bit more than ten but you know between 10 and 20 private universities that it would have impacted and northwestern was the only one in the big ten so it would have created some issues in terms of unionizing one one university within a conference in not unionizing others and how that would unfairly impact student athletes at one school versus others so they ultimately decided not to handle that case and they just let it go by and

18:34 North the northwestern football team ultimately decided not to unionize recently however the back in February of this year the general counsel for the National Labor Relations Board he came back and looked at the decision and determined definitively that division one football players on scholarship are considered employees such that they could unionize again for the same reasons that were cited in the original decision they benefit the university they’re being compensated through scholarship and they are subject to a vast amount of control by the university in terms of what they can and cannot do that decision however isn’t binding on anybody meaning that

19:22 well it while it helps student-athletes make an argument that they should be considered as employees a court doesn’t have to to allow or to make the same decision they can look at that and disagree with it which is what some courts have since done so even though you know it’s it’s sort of a win it at this point hasn’t gotten them anywhere because you know no court has adopted it yet NLR just stuff to answer some of these questions here quick before we go on to some practical considerations NLRB stands for the National Labor Relations Board and for the question about who said that football players were employees again

20:07 that would be the general counsel for the National Labor Relations Board he wrote a man memorandum back in February of this year that came to that determination hello let me see I think there’s one other question up here I think somebody asked what decided that football players were student athletes again that that’s probably a who if if I’m not answering that question correctly please type it again but who again would would be the the general counsel for the National Labor Relations Board so far that’s the only entity that has definitively come out and determined that college athletes are employees all courts all the court cases so far that have been decided have not

20:53 gone that route but there is there are some judges who are leaning that way for certain aspects of Division one again the revenue sports and then somebody asks what are the benefits of getting employees that so I’m glad you asked that because that leads into my my next topic here which are some of the practical considerations that would play into you know what student athletes would gain by becoming an employee and some of the potential consequences that I don’t think a lot of people consider when they just look at the situation and say well sure athletes should be compensated more you know for the for the revenue that they generate for their schools so the main impetus are the main

21:40 reason that student athletes especially in revenue generating sports like football and basketball are trying to gain status as an employee is because they would be compensated they would have to be paid the federal minimum wage for the amount of time that they spend in athletics and for overtime they be paid time and a half so most college athletes spend between 60 to 70 hours a week participating in their sport again through practice games you know they have to do fill study there’s weightlifting there’s travel times so you would have to schools would have to pay them for all of that time which could amount to be a significant portion of money and a

22:26 significant stipend for a lot of you know college students who otherwise can’t make any money because they’re not allowed to have another job but there are some potential issues with compensating student athletes as employees things that you know haven’t been talked about a ton but have come up at different times so one of those is if you start paying student athletes then you also have to text them because they are earning a wage and they would that money would be subject to being taxed by the state and the government so right now student athletes get full well not always but a lot of to Nessie’s to get

23:13 full scholarships or they at least get a partial scholarship that scholarship can pay for the room and board it can pay for their books they also can depending on the school and the sport they can also be paid a stipend which allows for what’s called a cost of living award which pays them you know anywhere between two thousand and five thousand dollars extra to allow them to go out to eat to buy clothes to pay for their off-campus apartment whatever it may be all of that would now have

23:58 you well they have to pay for books they have to pay for meals all of their meals are generally free they get unlimited snacks as part of their scholarship all of that would have to be paid for yep potentially so there’s a there’s a host of things that right now student athletes on scholarship don’t have to pay for that they may end up having to pay for and also be taxed for in addition right now student athletes get a lot of free merchandise I play it in college ten years ago and I still have sneakers and clothes sitting in my

24:45 closet from the time that I spent playing a Division one sport all of that could potentially be required to be paid for in the future if your employees you know you might have to take it out of their amount that they’re being paid to pay for their quote unquote uniform in addition you have right now some title nine considerations and what title nine is is it requires fair opportunities for both women in men

25:37 you you

30:35 you that’s why you see generally the same number of women’s teams as men’s teams at a certain college or university and so on and so forth if you start compensating student athletes are you only going to compensate the ones who are participating in revenue sports which are all men’s sports and then what happens to the rest of the sports who aren’t generating any revenue will there be enough money to continue to support those other sports will they have to go away how is that can impact the requirements under title 9

31:28 you maybe

32:54 you you

33:44 you men you know so there there are a number of those considerations as well you also have the potential for workers compensation claims if somebody gets hurt playing football they they tear up

34:31 their knee will they put in a workers compensation claim to you know be reimbursed for that time spent away from their employment you know so those are some of the practical considerations in trying to determine whether or not soon athletes or employees or and who’s but whether it’s even in their benefit to be considered employees because of all those issues and then the last one that I’ll mention is you know there are constantly arguments or disputes over playing time if a student athlete is the third string quarterback they’re not getting the amount of playing time that they want will that turn into a labor dispute or a discrimination suit that

35:18 they’re not being treated fairly as employees so those are some of the practical considerations and I think there are a number of questions that I missed so let me just come back up here and answer some of these so somebody asked about aren’t they already paid with scholarships that’s certainly the argument that a number of courts have made again depending on what school you go to what division you go to you may be getting a full scholarship or we may be getting a partial scholarship baseball students Dolf a number of detract and feel the number of the other sports are only getting partial scholarships so now everything is covered you know but it’s still potentially at least a year of

36:04 free education two years and then all the way up to four years of free education so there is some form of compensation there and again if student athletes were considered to be employees that compensation may go away and you instead would have to pay out of pocket for to go to school but you know out of the compensation that you were earning as part of your employment participating in your intercollegiate athletics in would that cover the same amount as your scholarship maybe maybe not then someone asked would they have to get time and a half or would they be seen as salaried there’s the potential

36:52 that they can be considered salaried there are some exceptions under the FLSA for college coaches for instance where if they’re over a certain threshold a dollar threshold they are considered salaried and you don’t have to pay them for the amount of time they spend over 40 hours a week but that you know that would be a consideration that would be up in the air whether or not they would meet that threshold whether colleges and universities could afford to play all pay all of their student athletes above that threshold most likely not because they can’t most of them can’t even afford to pay all of their athletic

37:37 staff above that amount there are you know most of the medical staff secretaries even some assistant coaches are not considered salaried a lot of them are what you would consider you know just general hour-by-hour employees and therefore would have to be paid for any time they spend working over 40 hours a week so the question next question is would they be receiving minimum wage or with the wage depend on the sport being played so that goes in to the one of the previous comments that that I made about whether or not revenue sports would be treated differently than non-revenue

38:23 sports for instance you know look again golf track and field baseball they’re not really generating revenue for the school so if there was some form of compensation made and it only talked to revenue sports then it really would only apply to to men’s basketball and football and whether or not they’d be truly making minimum wage or depending on the sport being played that actually is a potential another practical consideration because could you know could you make an argument that as an employee if you’re the you know main quarterback at Oklahoma University and you’ve taken your team to two straight

39:09 big 12 championship you’re an expert in your field so therefore you you can be compensated for other things such as it’s probably even a good example because it goes in other considerations but let’s just use it as one for now autograph-signing so if you set up you know some some autograph signing or you give a speech about football could you then be compensated for that you know right now as an employee if I go to present somewhere at a big conference or you know somebody wants to have a conversation about me with a subject that I’m fully familiar with I can be compensated for that so would you know

39:55 student athletes be able to do the same thing potentially and then how do you place limits on that so the big question for again particularly men’s basketball and in men’s college football you have all of these issues with boosters who are paying you know recruits to go to certain schools and are handing them cash after games and some other things outside of the NCAA amateurism rules how do you limit that once student-athletes are considered employees and make sure that they’re only being compensated for the work that they’re doing and not unduly being influenced by somebody else the next question is how much does the food and

40:42 uniforms add up to would this equate to the amount an employee would make let’s see for a football player you know I don’t know if pads would be included in that in helmet but you know how much potentially run between 200 to 400 dollars their uniforms can run 100 to 200 dollars generally they’ll have at least you know four or five pairs of shoes during the season because they have multiple pairs of cleats they have running shoes they have you know training training shoes they have warm-ups to and from games practice gear all of that adds to you know around thousands of dollars a year over the

41:29 course of four years and then food it again depends on the team in the in the sport and the student athletes themselves but you know your offensive lineman for a football team are eating much more than your swimming team or your gymnastics team but you know you’re talking hundreds again hundreds of dollars a week in food that generally student athletes are again at major divisional in school they’re not paying for can the college benefit by paying student athletes um if they were to open some of the other

42:14 NCAA rules potentially they could benefit because they could require some of the compensation that a student-athlete could get again for for signing autographs for instance they could require some of that to be to be painted to school as like a licensing fee or you know a fee for the time spent away from from work and some other things so there’s there’s some potential for them to benefit from that but it’s much less than what they’re getting now by by not paying them so that the negatives of paying student athletes for college and university far away the potential benefits there how would the

43:05 forty hours the week be counted would time spent depend spent independently in the weight room be counted so right now there’s a limit on the number of hours a week and it’s broken down by activity so there’s a certain amount of time that can be spent in film and study and a certain amount of time that can be spent on practice and a certain amount of time that can be spent on games all that adds up into the forty hours a week and schools and universities have to keep track of that they keep track of their practices they keep track of the time spent at games and they keep track of all of their film sessions and their weight room sessions and they have to

43:51 turn in logs and certify that those are accurate to the NCAA now it only that that forty hour a week requirement well it’s not it’s less than forty under the NCAA but that requirement only applies to mandated activities so if it’s a Saturday and it’s not you’re not in season and you want to go you know shoot shoot some hoops at the gym then you do that on your own that’s not a mandated mandated activity that you have to participate in so that doesn’t count towards towards the limit there however if student athletes were

44:38 considered employees and the athletic facilities were considered their work environment there may be a requirement for schools and universities to you know last lock the weight room lock the gym up to make sure that the student actually didn’t go beyond that that 40-hour work requirement because then they’d have to pay them time and a half if they went if the school itself had an independent weight room you know you could potentially run into a situation where that wouldn’t be counted as part of the 40-hour work week because you’re going in and doing it independently on your own even though it’s a part of the campus there might be a distinction that could be made there but otherwise you

45:25 can run into a situation where that actually negatively impacts student athletes as well because you know a lot of them are trying to work towards getting better for college their college athletics team or if they have pro aspirations and if they’re now limited in the amount of time that they can spend in the weight room or working on on their skills for their sport then they’re not going to you know they may not continue to progress and that may have to be limited for them to meet the hourly requirements as an employee I think there are a couple more questions here this training and practice count as work or what games played count as work only more than likely again because this

46:14 is something that hasn’t been doubt what there’s there’s no you know specific bright-line rule here but more than likely the training and practice time would all count if the student-athlete is considered an employee then the work that they’re performing is their intercollegiate athletics participation and as part of that you have again practice film session we rooms so all of that would likely be counted as part of the work performed by the student-athlete what makes student-athletes different from pro athletes so right now it’s that amateurism that applies to colleges and

47:00 universities so if you’re a pro athlete you own your you have control over what is called your name image and likeness you can go out and market a certain product if you want to you want to sign up with nice develop your own shoe sell that you know to consumers you have control over that you can go and you can sign autographs and you can be paid for it you’re professional so you can be compensated for all of that time as a student-athlete you’re considered an amateur and there are restrictions on what you can and cannot do you can’t accept money for anything related to your sport so there’s a kicker I think

47:46 it was from the University of Central Florida recently who had his NCAA Eligibility revoked because he set up a YouTube channel and part of his YouTube channel you know was attributed to his status as a student-athlete he was describing what he did for the football team and because it was related to his athletic activities the NCAA told him you can’t be compensated for that but he was accepting you know money through the ads that were being placed on his youtube channel so there are a certain number of restrictions that are placed on what student athletes kind of can’t do and it all boils down to be you can’t be compensated for anything associated with your athletics related activity for

48:33 the school other than your scholarship you know what you get in terms of of food and uniforms and meals and that cost of attendance award that I mentioned earlier the next question is so if a student athlete doesn’t play in a game or meet then they should still be compensated because of practice so yes if if they were not participating in a game for instance you could have you know your third string quarterback or you know a freshman who’s redshirting or or whoever it may be who’s still participating with

49:19 the team in practice and meeting all of the other requirements who if all student athletes were considered employees who could have to be compensated for the time now if he were just an hourly wage employee he’d only get he or she would only get paid for the amount of time that they’ve spent on the activity so if he wasn’t I mean if he was still attending the game then he’d be paid for that time even if he wasn’t playing if he he or she wasn’t attending the game and they were just sitting in the stands or you know out you know doing academics or whatever they may be doing and they wouldn’t be paid for that time but all the time spent at practice and anything else would count and they would be

50:07 compensated for that if they were considered an employee and the next question is how will the Fair Labor Standards Act affect student scholarships so I think you’re getting at here is and correct me if I’m wrong is that if student athletes were considered employees under the Fair Labor Standards Act would that impact student scholarships and the answer is that it could so if schools and universities have to pay their athletes a wage because they’re considered employees then they’re not likely to provide a free scholarship so the

50:53 concept of scholarships could go away completely or depending on how how they structured it as employee or whatever it may be you could argue that the scholarship would is is enough compensation that the student athlete would be a salaried employee and that’s the salary that you’re going to provide them is is that that scholarship because it’s you know potentially $50,000 a year or or more than that or if that you know wasn’t allowed to be the case for whatever reason and you had to pay them just you know 725 an hour or whatever the amount may be then you

51:41 might have schools that say well I’m not also going to pay a scholarship of you know $50,000 a year for this student athlete to go to school because I’m already I already have to pay them on top of that so instead you know there’s no more scholarships we’ll pay you as an employee you know whatever your hourly wages and then you have to use that to pay for your tech ear books in your room and board and your registration with the school with title nine in mind with the school only have to pay an equal number of activities ie football and volleyball men’s and women’s basketball and then

52:27 not pay any other athletes so it it can work that way for instance with that cost of attendance award I mentioned earlier that plays into the title nine considerations so that stipend a lot of schools pay it to their football and men’s basketball players but then they’ll also pay it to a couple of women’s athletics teams because they’re trying to balance out those those title nine concerns so that so they could select a number of sports to tribute that to I think somebody else has a question

53:30 will enforcing the Fair Labor Standards Act make it harder to sorry yeah cut off here unionize or fire athletes I’m not sure if it would make it harder to unionize because at that point if if you had if you were considered employees it may actually benefit unionization in the sense that now you’re definitively considered employees and therefore you have a right to unionize if you want to you’d still have a host of issues with that in terms of you know who’s going to be unionized is that one school is it an entire conference is it is it everybody in the

54:16 same sport and only certain sports and how does that impact the level playing field with people in the same sport if it’s only a segment of that population so there are some other issues there and then in terms of firing athletes yeah so right now depending on the school you may as a student-athlete only have a one year scholarship so your scholarship technically is subject