By Dan Siegel / Original to ScheerPost
The mammoth settlement between the National Collegiate Athletic Association (NCAA) and the five (soon to be four) major university athletic conferences must overcome a series of legal obstacles before it is approved by the federal judge overseeing three related cases. Potential court challenges are likely before the first dollar reaches the hands of a past, present, or future student athlete. Compliance with Title IX is already raising major concerns, and other, equally serious issues arise under both federal and state employment law. The ultimate approval of the settlement will destroy the NCAA’s fiction of amateurism in university athletics forever.
The settlement, first and foremost, is a good deal for the NCAA. Facing liability of more than $4.0 billion to 14,500 former student athletes who were not allowed to take advantage of the new rules allowing them to be paid for use of their names, images, and likenesses, the $2.8 billion settlement will cost the NCAA just $1.1 billion. The rest will be paid by the power five conferences ($1.65 billion) and the other 27 Division 1 conferences ($990 million) out of funds previously promised to them by the NCAA from the enormous revenues generated by television contracts. The athletes – former football and basketball players at the Power 5 schools – will also benefit, with payments that will average about $125,000 each, after payment of attorneys’ fees and costs.
Going forward, the 50 or so universities in the Football Bowl Subdivision conferences – the SEC, ACC, Big 10, and Big 12 – will each be able to spend 22 percent of their athletics income – estimated at about $20 million each annually – to pay their student athletes and to eliminate the present caps on athletics scholarships. The NCAA says that the agreement is dependent upon Congressional approval of the concept that student athletes, despite being paid, will not be considered employees. That itself is a tall order, given the large number of laws that define and regulate employment status. The long list includes the National Labor Relations Act, which regulates collective bargaining between employees and employers and is enforced by the National Labor Relations Board; federal and state civil rights laws that protect employees from discrimination, retaliation, and harassment, including Title VII and state laws like the California Fair Employment and Housing Act; other federal and state laws that regulate employees’ wages, hours, and working conditions such as the federal Fair Labor Standards Act and Equal Pay Act and the California Labor Code; laws that protect employees’ health and safety, such as the Occupational Safety and Health Act, and workers’ compensation laws; and laws that provide unemployment insurance benefits.
The NCAA’s insistence that the settlement will not go forward unless Congress agrees that student-athletes, even those who are paid under its explicit terms, are not to be classified as employees, is already facing opposition. Members of Congress may reasonably balk at engaging in such a transparent fiction. The NLRB and analogous state agencies treat university teaching assistants, graduate student researchers, and others as employees with collective bargaining rights. The U.S. Equal Employment Opportunity Commission and the California Civil Rights Department provide remedies including the right to bring civil lawsuits to student employees who make claims for discrimination, retaliation, and harassment.
Even were Congress to pass the requested federal legislation, there is no guarantee that state governments and courts would follow along. California labor laws, for example, have long been interpreted as providing broad protection to employees, regardless of how their employers attempt to classify them. Under state regulations validated by the California Supreme Court, “employ” means “to engage, suffer, or permit to work.” Current litigation over whether drivers for companies like Uber and Lyft can be excluded from employment benefits by classifying them as independent contractors is far from resolution. Recent cases also challenge the practices of companies using unpaid “interns” to avoid employment laws.
Some employment laws treat private and public employers differently. In California that could lead to different treatment of paid football players at Stanford and the University of California. The NLRB would oversee efforts to organize student athletes at Stanford, while campaigns at Cal would be supervised by the Public Employment Relations Board. Each agency is influenced by the political leanings of the officials who appoint their members.
Even if Congress were to pass legislation endorsing the concept that paid student athletes are not employees, Title IX would continue to protect female student athletes from certain kinds of gender bias. Title IX requires that men and women receive equitable treatment regarding the award of scholarship benefits and other services. If one-half of a school’s student athletes are women, then women should receive half of the athletic scholarship money and other benefits. Increased scholarship benefits for football players will have to be matched with more financial aid for female athletes. The argument that a male football player should receive a $150,000 annual scholarship while a female soccer player receives $15,000 because football brings more money into the university from TV contracts and ticket sales is not a guaranteed winner. University arguments that have attempted to justify dilapidated locker room facilities and obsolete training equipment for female athletes on similar grounds have been rejected by the courts.
It is hard to imagine that Congress and 50 state legislatures and court systems would all approve a plan to pay football and men’s and women’s basketball players, but not all student athletes. The California Equal Pay Act requires that employers pay equal compensation to men and women who perform “comparable” work. The word “comparable” is meant to overcome the kinds of challenges that arise when people claim violations of the analogous federal law that requires equal pay for “equal” work. Courts are likely to conclude that female volleyball players perform work comparable to that done by male basketball players.
On May 30, Judge Claudia Wilken of the United States District Court for the Northern District of California issued an order staying further proceedings in the three related cases, pending submission and consideration of the proposed settlement agreement. Far from a rubber stamp, Judge Wilken is expected to demand clear and detailed answers to a myriad of questions before approving the settlement. Assuming that she ultimately does so, litigation over its application and impact will keep the courts busy for decades. The era of exploiting student athletes for the benefit of the NCAA, their universities and the television networks is drawing to an end. The unfolding struggle will determine how many athletes will share in the benefits of the new regime and what levels of inequality will be allowed to continue.
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Dan Siegel
Dan Siegel is a civil rights attorney in Oakland.
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