United States – A US appeals court on Thursday devised a test that will assist courts in determining when college athletes are employers of their institutions and the organization that oversees American intercollegiate sports, making them entitled to the minimum wage.
The case is the first of its kind, and a panel of the Philadelphia-based 3rd U.S. Circuit Court of Appeals ruled that athletes would be considered employees under federal wage laws if they chiefly work for the benefit of their schools “in exchange for stipends or other perks, directly or indirectly, as reported by Reuters.
The ruling enables a group of former college athletes to move to a certification of a proposed class action against the NCAA and their former schools.
Impact on Former College Athletes
It follows a landmark USD 2.8 million that the NCAA awarded in May to settle class-action lawsuits alleging that it had acted unconstitutionally under antitrust law in limiting the students’ compensation and rewards for their sports services. In March this year, Dartmouth College men’s basketball players became the first college athletes in the U S to vote to unionize, although the action is being contested by the New Hampshire-based college.
The 3rd Circuit did not conclude on the particular question of whether college athletes are employees of the schools and the NCAA under the federal wage laws but established a framework for deciding when they are.
The court decisively dismissed the NCAA’s perpetual assertion that college athletes cannot meet the definition of employees based solely on student status.
Court’s Rejection of NCAA’s Traditional Argument
“The argument that colleges may decline to pay student athletes because the defining feature of college sports is that the student-athletes are not paid is circular, unpersuasive, and increasingly untrue,” Circuit Judge Luis Restrepo wrote for the court.
The appeals panel remanded the litigation to a trial judge to determine under the new test whether the plaintiffs were employees who should have been paid the minimum wage.
The NCAA has not provided any comments on this issue; the organization did not reply to a request for comment.
Future Implications and Legal Responses
Michael Willemin, of counsel for the plaintiffs, stated he was satisfied that the ruling “affirmed the core tenet … that the NCAA is not above the law and student-athletes may be employees entitled to the protections of” US employment statutes, as reported by Reuters.
The few states that embarked on the issue had ruled that college athletes were not employees since they were students and playing sports was part of their learning process. However, those rulings were before the U. S. Supreme Court ruling in 2021 that declared unconstitutional the NCAA’s restrictions on paying the players.