Not surprising, the highest paid college coaches and administrators are supporting paying athletes as employees. Complicating the matter is athletes fighting back in court – “what’s good for the goose is good for the gander.” The conversation is all about “pay for play.” No one is talking about education.
Why prioritize education? Less than four percent of Division I basketball and football players will play one day in the NFL or NBA or WNBA. The integrity of higher education demands that the athletic program be designed to support the best interests of the 96% of Division I and almost 100% of Division II and III college athletes whose college education is preparing them for life after sport.
In the pressure cooker of Division I football and basketball, how could higher education better manage the balancing of winning and educational interests? How do we protect athletes from unrealistic time demands or abusive treatment of some coaches who know their jobs depend on winning? How do we balance compensation of coaches with compensation of athletes?
Higher Education is a “United Fund” Non-Profit System
In 2021-22, 2,023 U.S. colleges and universities sponsored athletics programs serving 796,593 athletes. All of these programs are subsidized by state and federal governments allowing donors’ tax-deductible contributions to non-profit institutions, use of tax-exempt bonds for facility construction, and no taxes on sales and services. Only 28 of these intercollegiate athletic programs generated more revenues than expenses in 2021-22 and 98.6 percent had operating losses covered by institutions using tuition and mandatory activity fee dollars generated from all students.
Subsidization of athletic programs is not a criticism. Institutions of higher education are “united funds.” They generate resources from student tuition, required student fees, non-curricular activities, and the run small auxiliary businesses that support the student experience (student dormitories, bookstores and cafeterias) that pay for themselves and generate excess revenues. These revenues are then distributed to educational activities that may or may not pay for themselves thereby enabling institutions to deliver a broad choice of college degrees and educational experiences to the largest number of students the institution can afford. No country in the world makes higher education more accessible — 3,646 non-profit colleges and universities were in operation in the USA in 2022.
Within these institutions, the decision to offer academic or extracurricular programs is not based on the ability for those programs to be financially self-supporting. Liberal arts, the performing arts, foreign languages, history, English, law, among other academic programs, and most extracurricular activities do not pay for themselves. This broad selection of subjects and activities exists because of their contribution to human development and knowledge value.
Are Students Participating in Extracurricular Activities “Employees”?
If any extracurricular activity (clubs, athletics, performing arts, etc.) generates excess revenues over cost, participating students are not permitted to pay themselves for generating profits no matter how much they rehearse or practice or whether their performance makes a profit. They all work hard trying to improve their competencies with the help of teachers and coaches. They may or may not pursue these competencies as careers in life after college. Consistent with the operation of all non-profit entities, excess revenues over expenses goes to the larger institution to provide the educational or charitable service that made their tax-exempt status possible. This is the major difference between non-profit entities and for-profit businesses where profits are delivered to owners and shareholders.
Every sport or performing art activity makes the same contribution to the students who play – testing the limits of their talent under the pressure of competition or performing for the public, developing confidence, etc. All of these students receive “compensation” ranging from free travel and per diem to performances and some receive partial or full scholarships that pay for educational expenses. All of these students are “controlled” by their coaches or teachers. They all have to attend practice or rehearsal in order to play in a game or be on stage, and the coach has the power to terminate their participation in the activity if they don’t attend or break team/activity rules. This combination of “compensation”, “control”, and “termination” arguably meets the common law definition of employee. But it simply doesn’t make sense to apply this definition to students participating in competitive sports or performing art productions like theatre, choir and bands, regardless of whether they make a profit or not. A common sense understanding of these activities defies the simplistic application of “employee.”
The real athletics program challenge is making sure that students in those few intercollegiate sports that generate significant revenues are not abused by excessive time, travel demands, and abuse imposed by coaches whose salaries and continued employment depend on their success. The fact that a sport produces revenues that support broad sport offerings that are gender equal and operated in alignment with the educational purpose of a non-profit institution is a good thing, but winning and generating revenues cannot come at the cost of college athlete education, health, or civil treatment. Winning will always important in sport. The issue is how winning is pursued – the way we operate athletics.
Shift Coach and Administrator Reward Systems
It is not wrong to reward coaches for coaching excellence demonstrated by winning teams. The issue is excessive compensation that is generally higher than the
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professional sports market and contract terms that are non-existent in the non-profit education marketplace. NFL coaches get roughly the same pay as Power Four coaches but their teams generate four or five times the revenue. In 43 of 50 states, the highest paid public employee is a college coach. If we continue excessive paying of basketball and football coaches, fulfilling their every lavish facility whim to advance recruiting success, supporting bloated numbers of coaching and administrative support staffs, and now wish to “employ” athletes with its concomitant costs of employment taxes and overtime pay in addition to the cost of education scholarships, the outcomes are obvious. Non-revenue sports will be on the cutting blocks and institutional subsidies from student tuition and mandatory fees will increase to meet the need for winning and staying in the Power Four arms race. No amount of television revenues can sustain this future.
The more significant issue is the virtual absence of incentives related to athlete graduation — fulfilling the coaches’ recruiting promises of a legitimate education. Higher education leaders in the top ten Division I FBS conferences have “turned a blind eye” to Federal Graduation Rates of only 48% for Division I men’s basketball players, 64% of Division I FBS football players and 62% of women’s basketball players. Noting that the majority of players in these revenue sports are full-time students on full scholarships and majority athletes of color, these are simply unacceptable academic outcomes. We can and should track and reward coaches based on the graduation rates of every athlete recruited by the coach, team GPAs, and demonstrated remediation of the academically underprepared athletes they recruit. Higher education leaders must insist that remediating the academic deficiencies of underprepared recruited athletes admitted at the requests of the coach is an ethical responsibility. College presidents and chancellors are currently addressing neither remediation failure nor the common practice of funneling these athletes into less challenging courses and majors to keep them eligible to play and then either graduate with a less than meaningful degree or fail to finish, dropping out when their allowable years of eligibility expire.
What does shifting the reward system to achieve a reasonable balance between education and winning require?
1. Institutions tying a sufficient proportion of coach compensation, length of contract, renewal of contract, and annual bonuses to education outcomes;
2. Congressional approval of a narrow NCAA antitrust exemption that would permit NCAA rules that cap aggregated (not individual) coaches’ salaries and compensation and set limits on the number of coaches and operational support staff by sport; and
3. Condition such an antitrust exemption on institutions limiting compensation and benefits to coaches and administrative staff to be equal to or less than direct educational and health compensation and benefits provided college athletes.
Prioritize Athletes’ Health and Education
Coaches’ control of athletes’ time to the detriment of their academic work or health or having unchecked power to remove an athlete from the team should not be permitted in any educational institution. The solution is healthy oversight of these practices rather than paying athletes to suffer through them as employees. Here are six solutions for prioritizing athletes’ health and education:
1. Compensation for athletes must be tethered to educational purpose rather than “pay for play.” This is NOT about the NCAA’s long-time misuse of their “amateur sport status” justification. This is not a “paycheck.” It is about tying payment to the function of the education institution. Once payment is tied to game performance, winning, or revenue, the incentive has been created for profit and sport success over player academic success and the athletic program will operate antithetical to the mothership’s purpose.
2. Any offer of scholarship support should be guaranteed for five years or until graduation, whichever comes first, dependent only on maintaining academic eligibility, reasonable practice attendance and game availability and never withdrawn due to injury or athletic performance or the athlete attending a required class offered only at times conflicting with a practice.
3. Provide direct athlete compensation and benefits only in the form of scholarships and educationally tethered cash: for academic achievement, participation in academic support programs conducted for remediation of academic deficiencies, study abroad, full support of summer school attendance, fully funded internships or apprentice employment related to the student’s academic major, and further education following graduation.
4. As stated above, condition a federal antitrust exemption on cost controls that include the institution providing direct educational and health compensation and benefits to college athletes that is equal to or greater than compensation and benefits provided to coaches and administrative staff.
5. Provide every athlete with an athletic injury health benefits plan that covers all long and short-term medical expenses, out-of-pocket expenses, catastrophic injury protection, and second opinions associated with athletics injuries.
6. Protect athletes from being bribed (accepting money greater than the value of services rendered or an inducement to attend or stay) by boosters or other outside third parties or taken advantage of by unscrupulous player agents. The NCAA compliance officers at each institution should monitor and report suspicious activity including NIL (name, image, likeness) employment to the Federal Trade Commission, Bureau of Consumer Protection, for investigation and adjudication.
Prevent Excessive Control of Athletes
Higher education should adopt the following nine rules to make sure coaches are not allowed to treat players as employees:
1. Fifty percent of all positions on the rules making bodies of the NCAA and conferences should be designated for former athlete graduates with expertise in law, collective bargaining, economics, sports medicine, and/or education and be elected by current athletes to represent their interests. This shifts the current governance model of all representatives acting on the basis of their institutions’ self-interests in winning and making money.
2. Team rules and athletic department policies should be prohibited from restricting the rights of athletes to organize and protest — consistent with the rights of all students.
3. Every athlete should have access to an “ombudsman” outside the athletic department who mediates athletics program concerns of athletes, including abusive coach behavior.
4. No player penalties, including physical exercise as punishment, non-renewal of scholarships, or dismissal from a team, should be used as a consequence for lateness or absence from practice or a team athletics-related activity.
5. The rights of athletes to select academic courses and majors of their choosing should be protected by leveling financial penalties on any staff member who does not allow athletes to participate in required coursework that might conflict with some practice times or placing athletes in less challenging courses or majors in order to make sure they are eligible to compete in athletics.
6. No athlete should be required to participate in a non-practice or non-contest activity.
7. Practice on class days should be limited to a reasonable number of hours and a similar limit must be imposed on a weekly basis (the current so-called NCAA 20-hr. rule is misnamed with numerous loopholes resulting in athletes regularly putting in 30-50 hr. weeks).
8. There should be no restrictions to athlete transfers other than the prohibition of other institutions or third-parties using improper inducements to remain or transfer.
9. Independent and fair adjudication should be assured if there is any attempt to “fire” an athlete by declaring the athlete ineligible for anything other than meeting academic eligibility rules. An institution’s regular student disciplinary authority should adjudicate any attempt to remove a scholarship or dismiss an athlete from the team for conduct violations. Any athlete (or institution for that matter) alleged to violate NCAA rules, should be guaranteed due process and AAA arbitration.
We must reset the education compass of our intercollegiate athletics programs to meet the needs of all athletes – including those in the Power Four.
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