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College athletics are big business at many colleges and universities. The National Collegiate Athletic Association (NCAA) and the National Association of Intercollegiate Athletics (NAIA) are organizations of hundreds of member colleges and universities where student-athletes compete on behalf of and represent the institutions they attend. At least 38 NCAA member colleges gross more than $100 million annually in sports revenue[1].

            NCAA colleges and universities are divided among three divisions, with 350 institutions at the Division I level, 310 at Division II and 438 at Division III. Athletic scholarships may be given out to student athletes at the NCAA Division I and II levels, and Division I and II schools provide more than $3.6 billion in athletic scholarships annually to more than 180,000 student-athletes[2]. The NAIA includes 250 colleges and universities with over 83,000 student-athletes and over $1.3 billion in athletic scholarships awarded annually[3]. No athletic scholarships are permitted at NCAA Division III schools.

            In a significant change from prior practice, in 2021 the NCAA issued a policy on name, image and likeness (NIL) that permits individual student-athletes to be compensated for publicity or the promotion of a product or service[4]. In 2022 the NAIA announced its own policy on NIL. Student-athletes who receive compensation through NIL publicity or promotion are compensated by third-party organizations that are separate and apart from the schools they attend[5]. An individual student-athlete must follow the NIL laws of the state where the school they attend is located as each state has its own NIL rules. Some college athletes are now earning millions of dollars in NIL income, led by University of Colorado quarterback Shedeur Sanders ($4.7 million), University of Southern California basketball player Bronny James ($4.5 million) and Louisiana State University gymnast Livvy Dunne ($3.7 million)[6].

            But what about the financial benefits received by student-athletes from the university or college that they attend? Athletic scholarships may include payment of all or part of tuition, room and Board, student fees, books[7]. The specific college or university is paying those amounts, which may be substantial, in return for the student-athlete participating in a particular sport. Those amounts can be significant, with the cost of attending the 25 most expensive colleges and universities in America exceeding $80,000 per year[8] and the average annual cost of college more than $38,000 per year[9].

            An issue now being addressed in multiple contexts is whether student-athletes should be considered “employees” of the college or university at which they participate on an interscholastic athletic team. This question has arisen so far in the context of questions arising under the National Labor Relations Board (NLRB) and the Fair Labor Standards Act (FLSA). 

In a February 2024 decision of a Regional Director of the NLRB[10], it was found that the men’s varsity basketball players of Dartmouth College are employees under the National Labor Relations Act (NLRA) and were entitled to vote whether or not to unionize. Following that decision Dartmouth announced that it would refuse to collectively bargain with the union and will be requesting the full NLRB to overturn the Regional Director’s decision. If that review is not successful the issue will be taken to the federal courts for review. It is quite likely that the Supreme Court could ultimately be called upon to decide whether student-athletes qualify as employees under the NLRA.

More recently, in July 2024 the US Court of Appeals for the Third Circuit held that student-athletes may qualify as employees under the Fair Labor Standards Act (FLSA). The Third Circuit held in Johnson V. NCAA, 108 F.4th163 (2024) that college student-athletes may be employees under the FLSA when they perform services for another party, do so necessarily and primarily for the other party’s benefit, are under that other party’s control or right of control, and receive express or implied compensation or in-kind benefits for those services. The court stated in Johnson that certain student-athletes may be deemed employees entitled to the protection of the FLSA but that analysis is required to distinguish college athletes who play their sports for predominantly recreational or noncommercial reasons in contrast to those whose play crosses the line into employment protected by the FLSA.

It is important to note that  each of these decisions in Trustees of Dartmouth College and Johnson are likely not the final determination of the issues decided in each. Dartmouth College has promised to challenge the decision in its case and it is quite possible that the Supreme Court may be asked to review the Third Circuit’s decision in Johnson. 

But with the decisions in Trustees of Dartmouth College and Johnson finding college athletes to be employees in the context of these federal statutes (NLRA and FLSA), the question arises whether in certain circumstances a college athlete may also be deemed an employee for the purpose of coverage under a state workers’ compensation law. This question appears to have not yet been addressed in any state.

A fundamental requirement of any state workers’ compensation claim is the requirement of an employer-employee relationship and the occurrence of an accidental injury or occupational disease arising out of and in the course of that employment. The decisions in Trustees of Dartmouth College and Johnson and the conclusions in each that student-athletes may in fact be employees for the purposes of certain employee protection laws certainly leads to the question of whether an injured student-athlete could pursue workers’ compensation benefits for an injury sustained during a practice or game while a member of a college sports team.

We do not know the answer to that question yet. But it is something to consider. A student-athlete receiving financial benefit from the college or university he or she attends in the form of an athletic scholarship providing payment of all or part of tuition, room and board, student fees or books is certainly receiving financial compensation in return for being an athlete at that school. While we are not aware of cases in any state yet finding a student-athlete to be employee for workers’ compensation purposes, the decisions in Trustees of Dartmouth College and Johnson certainly provides a legitimate basis to consider making such a claim in appropriate circumstances.

            If you or someone you know has suffered an injury while a student-athlete at a college or university, call The Law Firm of Alex Dell, PLLC for a free consultation on the potential benefits available to you under the law. For over 20 years, The Law Firm of Alex Dell, PLLC has represented injured and disabled individuals throughout New York State with their New York State Workers’ Compensation, and New York State Disability Retirement claims. The Firm also represents individuals nationwide with their Social Security Disability and Veterans Administration claims. The Firm also represents individuals in Florida with their Workers’ Compensation claims and Disability Retirement claims.  

Should you have any questions or you would like to discuss this matter with us further, please contact us at 1-866-965-2667 .

We are here to help you.

[1] https://www.forbes.com/sites/marcedelman/2020/05/06/why-congress-would-be-crazy-to-grant-the-ncaa-an-antitrust-exemption/

[2] NCAA Student-Athletes, Scholarships (https://www.ncaa.org/sports/2014/10/6/scholarships.aspx)

[3]NAIA (https://www.naia.org/landing/index)

[4] This change in policy followed the Supreme Court’s decision in NCAA v. Alston, 594 U.S. 69 (2021) which found that the NCAA violated the Sherman Antitrust Act by limiting the education-related benefits schools could offer student-athletes. In a concurring opinion Justice Cavanaugh expressed the belief that the NCAA’s compensation structure raised serious questions under antitrust laws. Two weeks after the Supreme Court’s decision the NCAA implemented it’s NIL policy.

[5] NCAA Student-Athletes, Name, Image, Likeness (https://www.ncaa.org/sports/2021/7/9/name-image-likeness.aspx)

[6] College Transitions, 28 Highest Paid College Athletes – 2024 (https://www.collegetransitions.com/blog/highest-paid-college-athletes/)

[7] SportsRecruits, Athletic Scholarship Facts (https://sportsrecruits.com/resources/how-to-get-recruited/athletic-scholarship-facts)

[8] Best Colleges, most expensive colleges and universities in the U.S. (https://www.bestcolleges.com/research/most-expensive-colleges/)

[9] https://educationdata.org/average-cost-of-college

[10] Trustees of Dartmouth College v. Service Employees International Unit, Local 560, 2024 NLRB Reg. Dir. Dec. LEXIS 17 (2024)