Classifying college athletes as employees would create a myriad of financial and legal challenges for higher-education institutions. There are over 500,000 college athletes across NCAA Division I, II, and III programs. From addressing how overtime regulations fit within the context of a sport’s postseason playoffs to logistical issues of ensuring health care coverage for thousands of new employees, changes in the employment status of college athletes would raise significant questions for colleges and universities.
Legal departments can assist universities in planning by keeping an eye on two tracks: developments in the state and federal courts and developments from the National Labor Relations Board (NLRB).
Monitoring Developments on Employee Status in Civil Litigation
In 2018, the NCAA faced allegations that it, along with the Pac-12, violated federal employment law. The case, Dawson v. NCAA, involved a claim by college football players from Pac-12 member schools that the NCAA and Pac-12 violated the Fair Labor Standards Act (FLSA). The claim by the players was simple: Billions of dollars are made in college football, yet the players saw none of that. This argument faced an early legal hurdle: getting a court to recognize college athletes as employees.
As the Ninth Circuit noted, the core question is “whether Lamar Dawson [and the other plaintiffs] ... are employees of the National Collegiate Athletic Association (“NCAA”) and Pac-12 Conference (“PAC-12”) within the meaning of the Fair Labor Standards Act.” On that specific question, the Ninth Circuit was unequivocal:
The economic reality of the relationship between the NCAA/PAC-12 and student-athletes did not reflect an employment relationship.
While the Ninth Circuit was clear in its answer, it made sure to note what it was not deciding. The court noted that Dawson “does not allege that he was an employee of USC, so the pure question of employment [with a specific school] is not before us.” As a result, the court was able to sidestep “whether Dawson’s scholarship engendered an ‘expectation of compensation’ or whether his scholarship amounted to compensation because he did not receive the scholarship from the NCAA or the PAC-12.”
In 2020, the Supreme Court addressed a student-athlete case in Alston v. NCAA. That case did not address the employment status of college athletes. Rather, it involved whether NCAA rules restricting certain education-related benefits for student-athletes violated the Sherman Antitrust Act. Nonetheless, aspects of the Court’s analysis in Alston seem to be shaping the discussion about the employment status of college athletes.
For example, the core issue in Johnson v. NCAA – a case the Third Circuit remanded to the district court – is whether college athletes are by definition employees (much like Dawson). District Court Judge John Padova originally relied on Alston in his opinion denying the NCAA’s motion to dismiss. Citing both the majority opinion and Justice Kavanaugh’s concurrence in Alston, the court rejected arguments from the defendants that the NCAA “should not be required to pay Plaintiffs a minimum wage under the FLSA because Plaintiffs are amateurs” and there is a long history of not paying amateurs as “circular reasoning.”
In citing Alston, Judge Padova noted that past precedents “do not suggest that courts must reflexively reject all challenges to the NCAA’s compensation restrictions.” Citing Justice Kavanaugh’s concurrence in Alston to challenge past precedent, Judge Padova wrote how “decades-old ‘stray comments’ about college sports and amateurism … were dicta and have no bearing on whether the NCAA’s current compensation rules are lawful.”
Monitoring Employee Status at the NLRB
In addition to the courts weighing in on the employment status of college athletes, the NLRB addressed that same topic in two instances. The Dartmouth College men’s basketball team and the National College Players Association on behalf of the University of Southern California football and men’s and women’s basketball players brought separate actions before the NLRB in September 2023 and February 2022, respectively. Both petitions asked the NRLB to recognize college athletes as employees of their respective institutions.
Indicating that broader U.S. policy may impact this topic, both sets of college athletes withdrew their petitions in December 2024 and January 2025. As a result, no final decision was reached by the NLRB. These withdrawals were likely in response to the 2024 U.S. presidential election and the new Administration.
When evaluating these developments at the NLRB, it is important to consider the impact of the Executive Branch. Changes in how the President and those around him view higher education and college athletics could result in guidance from the Administration on topics such as the employment status of college athletes.
Practical Tips for College and University Legal Departments
- Discuss when it is appropriate to leverage government relations.
As seen in the voluntary withdrawal of the two NLRB petitions, federal policy on the issue of employment status of college athletes can change in a way that impacts potential outcomes.
- Develop a strategy now for how to respond to a circuit split.
Any decision in Johnson is not guaranteed to influence how other federal circuits will interpret the issue of whether college athletes are employees. As a best practice, think through how your institution will respond if a circuit split on this issue arises.
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