Should student athletes be paid?

Last Wednesday, Peter Ohr, the regional director of the National Labor Relations Board in Chicago, declared that a group of Nortwestern University football players were university employees and therefore entitled to unionize.  He made this declaration on the basis of the enormous revenue that the Northwestern football program brings in to the University – declared in an ESPN article to be $235 million over nine years; so about $26m a year.  Northwestern’s head coach Pat Fitzgerald was being paid $2.2m per year, according to a 2013 USA Today article.  Fitzgerald ranked significantly lower than the best paid coaches in college football – Charlie Strong will earn $9.375m from Texas this season ($5m salary and $4.375m in buyout to Louisville), Alabama’s Nick Saban earns $5.4m and Arkansas Bret Bielema earns $5.1m.  National champion Florida State pays Jimbo Fisher $2.75m.  Buffalo, which is expected to send linebacker Khalil Mack to the NFL in the first few picks in the upcoming NFL draft, pays coach Jeff Quinn $325,000 a year.  See here for full details.

Nortwestern was ranked 59th in terms of overall revenue ($41.8m) for college athletics in this ESPN 2008 list.  That meant that football accounted for over half of Northwestern’s total sports revenue that year.  Atop the list, Alabama made $123.7m in sports revenue in 2008.  If Coach Saban is being paid $5m and the overall sports program (not forgetting that Alabama also has D-1 basketball, not that it is anything like as big a deal as Alabama football) brought in $123.7m, where does the other $118.7m go?

Included in the $120m that Texas brought in in 2008 was $16.6m in branding – the famous burnt orange gear brought in nearly 1/10th of the Longhorns revenue.  The point must be made that one of the places that customers see said gear is on college athletes, although there is a strong likelihood that folks from Texas would buy magic beans if they were Longhorn orange, Aggie maroon or Red Raider, um, red.  When you walk into a sports store in Texas, you see jerseys that are ostensibly those of elite players – the Texas A&M jerseys you currently find are number 2 and number 13 (along with the number 12 – the 12th man).  Coincidentally, the Aggies two best players this past season, Johnny Manziel and Mike Evans, just happened to wear those two numbers.  This is the case across the country in the bookstores and sports stores of any college town.  The replica jerseys always reflect those of the current star player, but never with the name.

The question has been raised in some circles, for a number of years, why aren’t college players paid?

The NCAA, for its part, argued that the 150,000 college athletes receive more than $2.7bn in scholarships every year.  It also argued that the value of a college education was $120,000 and that the average college graduate has $35,000 in debt when they leave college.  Some private schools would consider a full college scholarship to be worth closer to $250,000.

On the “Sports on Earth” site, Patrick Hruby argued that “For decades, the National Collegiate Athletic Association and its member schools have conspired to fix the price of athletic talent at the value of a college scholarship, and not a dollar more”.  Hruby also argued that college football qualifies as a form of work, citing the following definition: “a person who performs services for another under a contract of hire, subject to the other’s control or right of control, and in return for payment.”

Ohr argued that

the record makes clear that the Employer’s scholarship players are identified and recruited in the first instance because of their football prowess and not because of their academic achievement in high school. Only after the Employer’s football program becomes interested in a high school player based on the potential benefit he might add to the Employer’s football program does the potential candidate get vetted through the Employer’s recruiting and admissions process

The justification for the decision was also based on the amount of time that players spend training for their respective sports.  Up to 60 hours a week was cited in his report as the amount of football-related activity that the complainants from Northwestern were engaged in.  That sort of commitment was, quite fairly, deemed to be the equivalent of a full time role.

For now, the ruling only impacts on private universities like Northwestern.  State university students (say at Ohio State) would be governed by that state’s laws on unions of public employees.  See Lester Munson’s report on ESPN for details.

BUT

Here is the problem: you can’t start claiming employee status as a student on scholarship.  If you do, your scholarship becomes taxable income.

In 2004 talk show host Oprah Winfrey gave 276 cars to the audience of her show.  The Pontiac G-Six was valued at $28,500.  That $28,500 constituted income in the eyes of the IRS and each audience member was faced with either paying a $7000 tax bill or forfeiting the car.  The only profitable solution for each audience member was to sell the car and pay the tax from the proceeds of the sale.  I’m sure Oprah did not want to simply give her audience $10k in cash.

Hruby has argued that “Ohr’s ruling makes it pretty clear that student and athlete are two different things. That football and school have nothing to do with each other.”  Really?  It looks an awful lot like Everett Golson has been serving an academic suspension at Notre Dame.  The Fighting Irish also suspended DeVaris Daniels and stud basketball player Jerian Grant for, wait for it, academic issues.  Have a look and see what happened to Duke RB Jela Duncan this past season.  Ineligible until Spring 2015.  Of course those of us with some knowledge of the way college athletics works know that players are encouraged to take particular classes in order to keep their GPA high enough to ensure continuing academic eligibility – particularly important in football where players have to stay in school for three years.  However, some college athletes do very much want to learn and to achieve a degree.

Hruby even raised the issue in his article, arguing:

Kain Colter, the former Northwestern quarterback leading the unionization movement, testified that he entered the university hoping to go to medical school. During his sophomore year, he tried to take a required chemistry class. He says both his coaches and his academic advisors discouraged him from enrolling, because it conflicted with morning football practices.

Here’s a thought, Kain…how about NOT PLAYING FOOTBALL THEN?  Anyone ever met someone who played a collegiate sport but wasn’t on scholarship?  Know what they did when athletics got in the way of the university experience?  They stopped playing.

There is a very real risk that these so-called pioneers could actually be spoiling the college athlete experience for the vast majority of student-athletes: the ones who never make it to the professional leagues and who use their scholarship to enable them to get a degree which they can use to help them develop a career after university.  In the case of Northwestern and other prestigious academic institutions, the student athletes are able to gain access to a level of education (not to mention a name on their CV) that thousands of regular students would kill for.  What’s more, they don’t even have to pay for their education.

This decision is the sort of myopia that defines modern collegiate athletics.  The bigger picture has been lost on all sides.  Too many have gotten caught up in the greed of the few within the NCAA and college administrators.  Too many on the side of the athletes have lost sight of what college athletics is supposed to be about: education and athletics side by side.

While this move has been driven by college football players, the key group that will be affected is basketball players.  The NBA implemented a minimum age rule to protect teams from selecting the latest prep-to-pro flop straight out of high school in their quest to find another LeBron James.  Consequently, the elite high school players make a mockery of the college athletics system by spending the bare minimum of a year enrolled at a university before entering the NBA draft as quickly as possible.  In order to ensure their ability to cash in on these infant superstars, colleges market the backside out of them, selling replica jerseys, t-shirts and all manner of gear and likenesses to promote their wider product of the entire college athletics program.

The whole thing is a mess and needs sorting out.  Here is the solution.

1 – You allow student-athletes to elect representatives, perhaps team captains, who can speak for their grievances at the levels of the college administration AND the NCAA.

2 – You do not allow them to become employees of the university and avoid the possible disaster of the IRS seeking tax money from people who frankly have no means to afford even the tax on a college scholarship.

3 – You allow fans to buy replica jerseys of any player.

4 – You agree that every player will earn a percentage of money brought in through the marketing of their image.

5 – You allow players to sell autographs and any other activity that allows them to make money off their own image.

6 – You enforce a new basketball rule whereby players can either go to the NBA straight from high school OR they commit to a college program for three years, just as in baseball.

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