Student-Athletes Should Be Paid — But Not as Employees

TK (Photographer: Carmen Mandato/Getty Images North America)

Last year, the average compensation package for a college football coach in the elite Football Bowl Subdivision increased by 15.3%. The top spot belongs to Alabama’s Nick Saban, who enjoys an eight-year, $93.6 million contract. Meanwhile, college football players continue to earn nothing from their schools.

So why not pay student-athletes like employees?

It’s an idea that’s been around for years and is gaining popularity and legal momentum as the football season begins. The National Labor Relations Board argued for it when it filed a complaint against the University of Southern California, the Pac-12 Conference and the National Collegiate Athletic Association. The NLRB alleges that all three “misclassified” football and basketball players as student-athletes instead of employees. A hearing is scheduled for November.

If players are reclassified, college sports will be upended, and not for the better.

It’s unlikely to benefit anyone but athletes in the most high-profile, profitable sports. The remainder, from swimmers to golfers, will find their opportunities to compete constrained or eliminated.

The problem is money. Revenues are booming for college athletics, but so are expenses. In 2019, the last year before the pandemic devastated college sports earnings, most of the 130 schools in the high-grossing Football Bowl Subdivision lost money. Some of those losses can be explained by the growth in coaching and administrative salaries. But subsidizing sports that don’t attract massive media rights deals also plays a part.

Those programs will be cut first if and when money-losing athletic departments are required to pay athletes. It’s happened before. During 2020, when Covid forced schools to put profitable football and basketball programs into hibernation, at least 30 universities cut close to 100 secondary sports programs — those that aren’t significant revenue generators — from squash to gymnastics.

Turning athletes into employees would be an even larger financial hit and one that could turn into a Title IX nightmare. While the law bars gender discrimination for any educational program receiving federal money, female athletes attract less attention and advertising dollars than their male counterparts. Rather than pay everyone, schools are likely to cut even more programs, and women-led sports — currently seeing growth and momentum — are the easiest target for the chopping block.

Meanwhile, the consequences could trickle down to the Olympics. The US team relies heavily upon a small number of universities to develop top competitors in categories such as swimming — a secondary sport at schools. Perhaps new funding and pipelines would emerge to develop talent if money-losing programs are cut, but the disruption to US Olympic ambitions would be significant.

It won’t be all good news for players likely to be paid, either. Among other issues, employee-athletes could find their scholarships viewed as income by the IRS and taxed in full. And if athletes seek to form unions and engage in collective bargaining, some schools seeking new revenue sources might try to negotiate access to athletes’ names, images and likenesses, known as NILs.

Nonetheless, as the business of college sports became a multibillion-dollar juggernaut, it’s great that the momentum to better compensate athletes for what they leave on the field has grown. But it shouldn’t come at the expense of amateurism — the idea that college athletes play for the love of the game — and a scholarship that benefits their future. Turing them into “employees” jeopardizes that part of college sports.

Fortunately, there’s a better approach to compensating athletes: a bipartisan college sports reform bill sponsored by Senators Jerry Moran of Kansas, Richard Blumenthal of Connecticut and Cory Booker of New Jersey. It envisions schools recommitting to the college degree and an athlete’s long-term health as a form of payment that embodies the original college sports ideal.

Under its terms, athletes would retain their scholarship aid, including room and board, until graduation (and not the end of their athletic eligibility), and institutions would be required to continue providing aid in case of a devastating injury (they aren’t, now). In addition, a medical trust fund would be created to cover long-term conditions related to playing sports.

Critically, the bill would expand access to NILs. Under its terms, a new corporation would be formed to create and administer rules to protect athletes who enter into endorsement contracts, establish a registry for agents, and prohibit institutions from punishing athletes for accepting compensation from third parties. For now, at least, the bill doesn’t address the employee status of athletes.

According to someone familiar with the bill, it’s a pragmatic approach designed to garner support in a divided Congress. Let’s hope so. For the more than 500,000 student-athletes playing NCAA sports, it could be a down payment on a healthier and more secure future. For college sports fans, it means a better, more engaged student-athlete. And for the NCAA, schools and those who profit off amateurism, the bill preserves and updates the century-old student-athlete brand. That’s a compromise worth pushing over the goal line.