A former soccer player from the University of Houston, Samantha Sackos, has filed a putative class action in the Southern District of Indiana against the National Collegiate Athletic Association (NCAA) and all NCAA Division I schools, asserting that student athletes are temporary employees owed minimum wage under the Fair Labor Standards Act (FLSA). On behalf of all Division I athletes, Ms. Sackos seeks compensatory damages, interest, and an injunction of the NCAA’s and Division I schools’ policies that do not require the payment of minimum wage to student athletes. The complaint claims the scholarships some student athletes receive do not count as compensation because they are not taxable income under federal law and cannot be spent on anything other than tuition expenses. The suit likens student athletes to work-study participants who sell programs, man concession booths, or usher at athletic events and are paid, on average, greater than the minimum wage.
Student athletes’ potential status as employees took the spotlight earlier this year when the NLRB handed down a regional ruling that Northwestern University football players were employees within the meaning of the National Labor Relations Act and could therefore unionize. The NCAA and Northwestern have appealed that decision. Meanwhile, the NCAA is also appealing a bench trial ruling that the NCAA violated antitrust law by prohibiting college athletes from being paid for the use of their names, images, and likenesses.
If the suit comes out in Ms. Sackos’s favor, it will leave schools across the country on the hook for significant amounts of back pay to current and former athletes and will open the door for athletes’ claims for overtime compensation. College sports comprise a multi-billion dollar industry, so if the court identifies student athletes as temporary employees, the debate is unlikely to end at the FLSA’s application. If the benchwarmer earns minimum wage, should the star player generating the wins, ticket sales, and media attention deserve a hefty bonus?