Implications for Federal Anti-Discrimination Laws
In a pivotal legal battle, the Third Circuit is currently deliberating whether college athletes should be considered employees under the Fair Labor Standards Act for the purpose of receiving wages. This landmark case could potentially reshape the landscape of collegiate athletics and have far-reaching implications, namely in the field of anti-discrimination law. Experts say that if a decision is rendered in favor of the athletes, there could be a wave of litigation resulting from athletes bringing claims under federal anti-discrimination laws.
The Labor of College Athletes
For years, college athletes, particularly those in high-revenue sports like football and basketball, have been at the center of a debate regarding their status as student-athletes versus employees. These athletes generate significant revenue for their respective institutions through ticket sales, merchandise, and television contracts. Yet, they often receive only scholarships in return for their hard work and dedication.
The Argument in Favor of Employee Recognition
The argument in favor of recognizing college athletes as employees is rooted in the notion that they perform a vital role in the multi-billion-dollar college sports industry. Proponents assert that college athletes dedicate extensive time and effort to their training, competitions, and promotional activities for their schools, often at the expense of their academic pursuits. This demanding commitment can leave them with limited opportunities to earn income outside of their sports involvement. This compensation could help them cover living expenses, healthcare, and other essentials while recognizing their contributions to the thriving collegiate sports enterprise.
This issue of whether student athletes are employees is not new. It also arose in the context of a request for collective bargaining in Northwestern University and College Athletes Players Association, NLRB Case No. 13-RC-121359. In that case the National Labor Relations Board (NLRB) declined to take jurisdiction of the case on other grounds. The NLRB concluded that, even if they determined that the student athletes were employees, the decision would not serve to promote stability in labor relations because they had no jurisdiction over most college football programs as many are administered by state institutions. The National Labor Relations Act (NLRA) does not apply to public employers. The NLRB recognized that if it did take jurisdiction in this instance, it would be legally and practically cumbersome where the competing teams were unrepresented and outside the Board’s jurisdiction.
The question of whether student athletes are employees was left open by the Board for further review and potentially congressional direction. In 2021, NLRB’s General Counsel Abruzzo issued a memorandum following up on the Northwestern University decision and answered that question with a resounding “yes” noting that these student athletes:
- Perform a service for the university which generates millions of dollars in profit,
- Receive significant compensation through scholarships
- Are controlled by the NCAA’s “terms and conditions of employment” and the University’s rules as to their work on the field and other facets of their daily lives.
According to General Counsel Abruzzo, misclassifying such employees as “mere ‘student-athletes’” is a violation of the NLRA.
The Opposition to Employee Recognition
Alternatively, opponents of recognizing college athletes as employees argue that it would erode the principles of amateurism and the spirit of collegiate sports, potentially compromising the integrity of the games. They also contend that such payments could worsen financial inequalities between larger and smaller institutions, further dividing collegiate sports. These critics assert that the current system offers compensation in the form of scholarships, and college athletes can pursue lucrative professional careers, making immediate compensation unnecessary.
The Third Circuit’s Deliberations
The case currently pending before the Third Circuit, Johnson v. The National Collegiate Athletic Association, involves a group of college athletes who claim they should be considered employees and, therefore, entitled to minimum wage and overtime pay under the Fair Labor Standards Act (FLSA). If the court rules in their favor and college athletes are thereby classified as “employees”, these athletes can then bring discrimination claims under employment statutes, such as Title VII of the Civil Rights Act of 1964, the Equal Pay Act of 1963, and Title IX of the Education Amendments of 1972. By determining that college athletes are employees and thereby entitled to minimum wage and overtime pay, the door then opens for claims of unequal pay.
The Cascading Effect
If college athletes are deemed employees, there could be a “cascading effect” of opening the door to various legal challenges under federal anti-discrimination laws, such as Title IX and Title VII.
Title IX, which prohibits sex-based discrimination in education programs and activities, has been instrumental in promoting gender equity in college sports. If athletes are considered employees, Title IX obligations may extend to ensuring equal wages and opportunities for female athletes, potentially leading to changes in funding and resources allocation within athletic departments. Jodi Balsam, a sports law expert and professor at Brooklyn Law School noted that schools may need to change the way they manage the athletic programs in order to justify, for example, why the football players are paid more than the women’s lacrosse team by holding the women players to fewer or lower expectations. She explained:
“In any job classification system, when it comes to addressing gender disparities, you need to justify those disparities by job classifications and expectations and market values.”
Furthermore, Title VII of the Civil Rights Act prohibits employment discrimination based on race, color, religion, sex, or national origin. If college athletes are recognized as employees, universities may face increased scrutiny over issues of racial discrimination within their athletic programs. This could have implications for hiring practices, coaching staff diversity, and opportunities for athletes of different backgrounds.
As the Third Circuit deliberates on whether college athletes should be considered employees, the outcome of this case has the potential to reshape the landscape of college sports. The debate over athlete compensation is just the tip of the iceberg. A decision in favor of the players could lead to the implication of federal anti-discrimination laws, impacting issues of gender equity and racial fairness in college athletics. It remains to be seen how the Third Circuit will rule, but the outcome will likely have a profound impact on the future of college athletics and the broader conversation about athletes’ rights and equitable treatment.
KJK will continue to track this issue closely and provide updates on any advancements or outcomes. For further information, please contact KJK Labor & Employment attorney Rob Gilmore (RSG@kjk.com; 216.736.7240) or Emily Vaisa (EOV@kjk.com; 216.736.7257).