On October 17, the U.S. Senate Judiciary Committee heard testimony on the need for reform in college sports, including the possibility of establishing a national standard to regulate name, image, and likeness (NIL). The hearing was part of recent efforts to develop a framework that could preempt a future ruling by the U.S. Supreme Court that student-athletes are employees of their institutions of higher education under Fair Labor Standards Act (FLSA) and similar state laws. During the nearly three-hour hearing, committee members expressed bipartisan agreement on the need to reform the state’s disparate legal framework that currently exists, but expressed wide differences of opinion on whether appropriate scope of Congressional involvement.
The impetus for the hearing came from the U.S. Supreme Court’s 2021 antitrust decision. NCAA vs. Alston, where the Court’s opinion characterizing student-athletes as participants in a labor market prompted the NCAA to abandon its strict stance on amateurism and change its rules to allow student-athletes to pay their NIL. Many have highlighted the Alton decision – and Justice Kavanaugh’s blistering agreement, in particular – as a path to an eventual Supreme Court ruling finding that student-athletes are employees under the FLSA. In fact, the Third Circuit Court of Appeals is currently considering this issue, and its decision could be the means by which this issue comes before the Supreme Court. As the issue of student-athlete employment status makes its way through the federal courts, the NCAA, representatives of higher education institutions and student-athletes regularly travel to Washington to lobby for a federal action.
During the hearing on the Senate Judiciary, committee members and witnesses expressed near-universal agreement that congressional inaction was not a viable option. Lawmakers recognized that there was an urgent need for the Supreme Court to rule and that Congress’ failure to intervene would result in an “unworkable” patchwork of state labor laws (much like what currently exists, with respect to NILE). NCAA President Charlie Baker recommended that Congress codify the FLSA’s current regulatory guidelines into law to confirm that student-athletes are not employees of their schools, and he expressed his understanding that many groups of student-athletes do not want to be considered employees.
Jill Bodensteiner, vice president and director of athletics at Saint Joseph’s University, testified that “the threat of athletes becoming employees is the number one threat” to her institution. Bodensteiner, among other witnesses, listed his assessment of the potential impact arising from such a legal decision, including negative tax implications for student-athletes, restrictions imposed by immigration law on international students, a increasing costs of collegiate sports and the subsequent reduction in costs. the number of sports programs that higher education institutions could offer.
Republican members of the committee, including Senators Graham and Tillis, expressed concern that the employment status could harm NCAA Division II sports as well as athletic programs that do not generate revenue, which could negatively impact Olympic training and professional sports leagues that recruit collegiate athletes. Democratic members remained largely silent on their opinions on the employment status of student-athletes, with the exception of Senator Blumenthal, who expressed skepticism about the feasibility of the route that would be necessary to define certain segments of students -athletes as employees, but not others.
Ramogi Huma, executive director of the National College Players Association, recommended to committee members that student-athletes participating in FBS football and Division I men’s and women’s basketball should be considered as employees. However, his views do not appear to have the support of any member of the committee. Senator Hawley also offered the unique opinion that student-athletes should be able to bargain collectively with their institutions to overcome the asymmetry of bargaining power.
The committee discussed other legislation under consideration, including a proposal from Senator Blumenthal to create a medical trust fund for student-athletes, require schools to provide scholarships for injured student-athletes, take cover athletes’ insurance costs and personal medical expenses, and establish enforceable safety standards for students. The proposal encountered no discernible opposition.
This is the 10th such hearing held by Congress in recent months on the issue of college athletics. Committee members’ remarks suggest that, along with adopting an NIL regulatory framework, Congress is likely to exempt student-athletes from being considered employees of their institutions. If Congress does this, the status quo remains. Otherwise, institutions will likely have to comply with requirements introduced by the U.S. Supreme Court.
