Collective Bargaining, Lockouts and Strikes: The Unintended Consequences of Paying College Athletes

Last Updated on July 26, 2011

Yesterday, my friend Lisa Horne over at FOX Sports published a really interesting piece on how paying college athletes could lead to them being classified as employees and capable of collective bargaining. Horne interviewed me for the piece several weeks ago, and I’ve been eagerly awaiting its publication.

As Horne says in her article, “If the rules-makers can’t stop a kid from trading pants for tattoos, how can they expect to prevent an 18-year-old — with maybe $100 in his checking account — from listening to a union rep’s lure of riches?” She makes an excellent point. If student-athletes were classified as employees, there’s no reason to believe they wouldn’t form a players association and collectively bargain for everything from safer working conditions to their share of the revenue pie.

And they would have every right to do so as employees. But can you imagine the impact of a strike or lockout in college football? It would make the NFL lockout look like child’s play. As I said in Horne’s article, every Saturday an average of 5 million fans pack Division I stadiums. Compare that to just 1.1 million on any given Sunday in NFL stadiums. Add in the economic impact to each city on gameday, which for top programs is in the tens of millions of dollars, and the numbers are staggering.

Increasing scholarships to cover cost of attendance is not going to trigger a reclassification of student-athletes as employees. However, any pay over that very well could. Here’s how it might go. Let’s say college athletes are being paid some amount, any amount, over cost of attendance. One or more players decide schools, conferences and/or the NCAA are violating antitrust laws. Essentially, antitrust laws disallow business practices that discourage competition or restrict an employee’s ability to make a living. So, for example, players could sue over the requirement that they sit out one year when transferring. Similar issues in professional sports have been considered by courts such as the franchise tag in the NFL and the reserve clause in Major League Baseball.

Restraints such as not allowing a player to reach free agency for a specified number of years are only allowed in professional sports because they’ve been collectively bargained. The product of collective bargaining between an employer and unionized employees is protected by the non-statutory labor exemption.

So, back to our scenario. One or more players sues a conference or the NCAA for a restraint like the rule regarding transfers. If players were classified as employees (which could be determined in a suit like this), it’s highly likely the court would find this to be a violation of antitrust laws. Much like we’ve seen in the history of each professional sport, the players would form a players association and collectively bargain these issues with the NCAA, assuming the NCAA was still the governing body for collegiate athletics. If not the NCAA, it would be whatever governing body we have for collegiate athletics.

What would collegiate athletics look like then? Maybe there would be a salary cap for each athletic department or even each football program. Players would likely get a share of licensing revenue. Health insurance and maybe even post-career benefits might be covered by schools or the governing body. Since schools would be receiving less revenue than they currently receive, they’d likely have to cut sports that don’t turn a profit in order to make the finances work, which generally means any sport outside of football and men’s basketball. And remember, Title IX still applies. Women have to have similar opportunities. This is true even if you take football out of the NCAA. As long as football is still associated with the school, Title IX (a federal law) applies.

Another area where you begin to see the system doesn’t work is when you talk about having a draft or trading players. Those things wouldn’t fit in collegiate athletics. It might be contrary to what you think, but I would imagine most players have an opinion about where they want to go to school. One that’s much stronger than say a prospect in the MLB draft who wants to play for his hometown team. Brett Hundley at UCLA is said to have chosen UCLA for its pre-med program. Because many of these athletes are taking advantage of the academic opportunities afforded to them, it doesn’t make sense to have a draft or allow trades. What if they ended up at a school that didn’t have their major?

None of this is to say that a system couldn’t be created that worked. However, it’s not as easy as simply deciding tomorrow that college athletes should be paid. There are a number of ramifications to that decision, from figuring out how to comply with Title IX, to finding the money in the majority of athletic departments who aren’t self-sustaining, to the myriad of issues that arise if college-athletes are reclassified as employees.

student athlete compensation