The debate concerning the fair compensation of National Collegiate Athletic Association (NCAA) athletes is not a new one.1 Since Justice Kavanaugh’s concurrence in NCAA v. Alston,2 much of the discourse has shifted to how, not when, college athletes should be compensated.3 In recent years, NCAA sports have also experienced the surge of Name, Image, and Likeness (NIL) payments to players.4 Additionally, advocacy for direct pay-to-play compensation has arisen.5 Recently, in Johnson v. NCAA,6 the Third Circuit held that some college athletes may be employees of their universities for purposes of the Fair Labor Standards Act7 (FLSA) and devised a test to determine which college athletes would qualify.8 This test conflicts with Title IX’s9 equity regulations and principles, evincing the necessity for intervention by Congress or the NCAA itself to avoid the destruction of the college athletics model.10
In 2019, six former college athletes brought several claims in the United States District Court for the Eastern District of Pennsylvania against the NCAA, the colleges and universities that the athletes attended, and over 100 other colleges and universities that are members of NCAA Division I.11 The plaintiffs alleged violations of the FLSA and state employment laws.12 Specifically, the plaintiffs argued that they were employees of the NCAA and of their schools and “[sought] payment of wages for the time [they] spent engaged in activities connected to NCAA sports.”13 The defendants moved to dismiss the complaint because “it [did] not plausibly allege that [p]laintiffs [were] their employees.”14
Judge Padova denied the defendants’ motion.15 He rejected the “circular” reasoning that “amateur” status precluded college athletes from being employees, emphasizing Justice Kavanaugh’s concurrence in Alston.16 He also rebuked the defendants’ argument that the Department of Labor Wage and Hour Division’s Field Operations Handbook foreclosed an employee-employer relationship between college athletes and their universities as a matter of law.17 Judge Padova lastly applied a multifactor economic-realities test from Glatt v. Fox Searchlight Pictures, Inc.18 and held that the analysis of the Glatt factors19 weighed in favor of the conclusion that the complaint “plausibly allege[d] that [p]laintiffs [were] employees” of the schools they attended.20
The Third Circuit vacated and remanded.21 Writing for the panel, Judge Restrepo22 began by surveying the history of intercollegiate athletics, from its naissance at an 1852 boat race between Harvard and Yale University to its growth into the billion-dollar behemoth that NCAA Division I sports are today.23 He also recounted the genesis of the NCAA’s “student-athlete” moniker.24
Next, Judge Restrepo recited the FLSA’s definition of employee — “any individual employed by an employer”25 — which “has been described as ‘the broadest [definition] that has ever been included in any one act.’”26 He then highlighted two other integral definitions: Employer includes “any person acting directly or indirectly in the interest of an employer in relation to an employee”27 and to employ is “to suffer or permit to work.”28 He explained that to determine FLSA employment, courts must “look to the economic realities of the relationship,”29 which depend on the totality of the circumstances.30
Drawing on the preceding definitions and precedent from both the FLSA line of cases as well as common law NLRB cases, Judge Restrepo constructed a balancing test that suited the “sui generis”31 situation of college athletes.32 He held: “[C]ollege athletes may be employees under the FLSA when they (a) perform services for another party, (b) ‘necessarily and primarily for the [other party’s] benefit,’ (c) under that party’s control or right of control, and (d) in return for ‘express’ or ‘implied’ compensation or ‘in-kind benefits.’”33 In announcing the new test, he explained that Glatt was “not sufficiently analogous to the case at bar.”34
Judge Restrepo then turned to the NCAA’s “tradition of amateurism” assertion “that colleges may decline to pay student athletes because the defining feature of college sports . . . is that the student athletes are not paid.”35 He held that the NCAA’s continued reliance on the “frayed tradition” of amateurism could not preclude college-athlete employment status as a matter of law,36 directly rebuking a 2016 Seventh Circuit opinion37 on that question.38 Judge Restrepo concluded his opinion by noting the importance of employing an economic-realities test that draws a line between “play” and “work.”39
Judge Porter concurred in the judgment but took issue with Judge Restrepo’s lack of elaboration.40 He argued that the majority’s “definitional test [did] not adequately probe the distinction between play and work, nor explain how district courts should do so.”41 He then proceeded through Judge Restrepo’s economic-realities test.42
On the first factor (service), he posited that the majority failed to clarify the difference between “service,” “labor,” and “work.”43 All college athletes “serve” on their respective teams, he explained, but that does not create an employee-employer relationship.44 He argued the second factor (primary beneficiary) failed to account for direct versus attenuated benefits to the university.45 The third factor (right of control) did not distinguish Division I athletes from Division III athletes,46 the latter of whom are almost certainly not employees. For the fourth prong (expectation of compensation), Judge Porter pointed out that the majority did not indicate how lower courts should assess non-revenue-generating sports.47 He argued that revenue generation was likely an essential factor in determining the “economic reality” of the relationship between a college athlete and their university.48
Judge Porter concluded his concurrence by identifying several unaddressed implications of the majority’s reasoning.49 He cited the decades of precedent that declared college athletes were not employees50 to argue the changed circumstances of Division I football and basketball should animate distinctions within the Johnson test.51 He also explained that the majority’s test may fit “uneasily” with other bodies of statutory law.52 For example, he posited that if only some college athletes are employees, Title VII of the Civil Rights Act of 196453 and Title IX of the Education Amendments Act of 1972 could clash.54 This is because while Title VII prohibits employment discrimination “because of . . . sex,”55 Title IX requires that sex be taken into account to ensure “equal ‘participation opportunities.’”56
Judge Porter’s observations are helpful but fail to answer a key question Justice Kavanaugh raised in his Alston concurrence: “How would any compensation regime comply with Title IX?”57 As Judge Porter recognized, the boundary between revenue-generating sports (men’s football and men’s basketball) and non-revenue-generating sports may be the most logical line to draw between “play” and “work.”58 If this delineation falls along gendered lines, Title IX regulations and their central equity principle could require proportional pay-for-play compensation between the sexes.59 This outcome would cripple the NCAA’s financial system60 and evinces the necessity for reform by Congress or the NCAA to avoid the dissolution of Division I college athletics.
It is unlikely that courts applying the Johnson test will find that all Division I athletes are employees.61 Drawing on Judge Porter’s insights, the first (service) and third (control) factors of Johnson’s test are probably satisfied for all Division I athletes.62 Johnson’s second (primary benefit) and fourth (expectation of compensation) prongs help draw the distinction between “work” and “play” that Judge Porter identified as crucial.63 The threshold to satisfy the “benefit” factor likely hinges on “whether a university’s sports team is . . . economically comparable to . . . profit-seeking businesses, or . . . essentially an extra-curricular activity.”64 Similarly, the expectation-of-compensation prong is likely met if an athlete’s sport is “essential” to the “university’s business,” rather than “incidental” to it.65 When these two factors are combined, it is logical to use revenue generation as a metric to assess whether they are satisfied.66
Division I football and men’s basketball players are probably the only college athletes that generate enough revenue to satisfy all four Johnson prongs.67 Both are comparable to a profit-seeking business and essential to the NCAA and universities’ athletic departments.68 If the district court finds these players are employees, the FLSA would mandate the NCAA and universities to pay athletes competing in those sports.69 However, it is unlikely that female college athletes would qualify as employees under Johnson.70 Paying only male athletes could implicate Title IX’s regulations and policy interpretations,71 as most universities are subject to Title IX.72
Given the novelty of pay-for-play compensation, it is unclear how Title IX could regulate such payments. College athletes already receive indirect compensation through two major channels: athletic scholarships73 and NIL deals.74 Title IX requires that “if a college awards athletic scholarships, it must ensure that male and female athletes receive those scholarships ‘in proportion to the number of students of each sex participating in interscholastic or intercollegiate athletics.’”75
While some commentators believe it is “crystal clear” that Title IX would require proportional pay-for-play payments,76 they recognize that the “details can seem pretty complicated.”77 Professor Andrew Haile argues that disproportionate payments between the sexes would not produce Title IX issues under the current regulations.78 He explains that Subpart D of the regulations, which bars schools from “limit[ing] eligibility for [financial] assistance . . . , apply[ing] different criteria, or otherwise discriminat[ing],”79 does not capture pay-for-play payments.80 Haile further posits that if such payments fall under Subpart E of the regulations, which governs employment,81 the universities and the NCAA could “justify differences in pay by demonstrating that those differences are ‘based on any factor other than sex,’”82 such as revenue.83
However, revenue generation may not be a justifiable factor to delineate compensation. Professor Erin Buzuvis argues that the status quo, wherein the majority of high–market value college athletes are male, reflects the inequitable investment and opportunity afforded to female athletes.84 Thus, tainted by past sexism and arguable Title IX violations,85 revenue generation may be an inapt nondiscriminatory factor. Intervenors in a recent NCAA settlement made a similar argument86: In that case, the NCAA agreed to a system in which college athletes would receive pay-for-play payments consistent with their market value.87 Like revenue generation, market value is seemingly sex neutral. However, if disparities in both categories result from historically inequitable investment, such metrics may be tainted, and their use could violate Title IX.88
If the Johnson test produces a dividing line along revenue generation as Judge Porter predicted, Title IX’s application to pay for play will become a live question and the NCAA’s system could be in jeopardy.89 Whether or not Title IX’s present regulations require proportional pay-for-play compensation between the sexes, refusing to pay female athletes while paying their male counterparts is arguably against the spirit of Title IX90: “that our daughters will have the same opportunities as our sons.”91 Paying one sex and not the other directly contradicts this aspiration. But, if all college athletes received even minimum wage, the NCAA model would crumble.92
It should not be surprising that legislation and regulations drafted when the fair compensation of college athletes was only a burgeoning aspiration would not adequately design a system in which pay-for-play compensation is dispensed equitably and practicably. It is time for policymakers to either rethink the inclusion of certain sports in the traditional NCAA model or revamp the model in its entirety.