Should Student-Athletes Be Paid? The Answer is Not So Simple.

A policy adopted in June 2021 by the National Collegiate Athletic Association (NCAA) dramatically changed the trajectory of college sports when it allowed student athletes the opportunity to use their personal brand in promoting a company’s products and services under paid marketing agreements with third parties. Some observers say this new policy is a departure from the standard of “amateurism” that has stood as the NCAA hallmark of college sports. Others argue that student athletes are subject to unique pressures that other students do not have and therefore they deserve to be paid beyond the compensation they receive in the form of sports scholarships. For example, student athletes face a higher risk of injury which could affect their future career prospects. In addition, student athletes contend with the challenge of balancing a heavy academic workload with the time demands of their sport which may prevent them from holding a part-time job to earn extra income. Craig Esherick, academic program coordinator of the Sport Management program within George Mason University’s School of Sport, Recreation, and Tourism Management (SRTM), recently discussed the pros and cons of whether student-athletes should be paid.

NCAA’s “Name, Image, and Likeness” policy has changed the landscape of college sports.

Throughout its history, the NCAA has classified student-athletes as amateurs and has prohibited schools from paying these individuals to play. Instead, student-athletes receive sports scholarships covering room, board, books, tuition, and other costs of attendance. The classification of student-athletes as being amateurs and the ban on paying student-athletes a salary has always been what distinguishes college sports from professional sports. But the NCAA’s 2021 “Name, Image, and Likeness” (NIL) interim policy, along with other recent developments, has made this distinction less clear. The NIL policy allows student athletes to monetize the use of their name, image, and likeness through product promotion and endorsement contracts made with third parties. These contracts are frequently orchestrated by university collectives which include local businesses, donors, as well as college alums, and they are subject to certain restrictions set by state laws which vary across the country.

Proponents of the NIL policy say that it preserves the NCAA prohibition on paying student athletes to play, while providing an alternate avenue by which they can receive financial compensation for monetary needs that are not met by their sport scholarships. Advocates also cite the positive experience that student-athletes obtain when they negotiate with businesses on the terms of the NIL contract by which they will promote, sponsor, publicize, or endorse the company’s products and services— gaining experiences similar to an internship. Critics of the NIL policy say it encourages the further commercialization of college sports and detracts from the concept of amateurism that serves as an underlying principle in college sports. They also point out that NIL contracts having the potential for the largest payouts go to elite student-athletes who make up a small percentage of the total number of college athletes. While a lucrative NIL contract offered to a player can elevate the visibility of their team or sport, it can also cause resentment among teammates who do not receive similar corporate endorsement or promotional opportunities. This can potentially lead to team friction.

The use of NIL contracts may be more advantageous to some schools compared to others.

In addition, the use of NIL contracts may give certain schools an advantage over others in attracting top ranked student-athletes. For example, university collectives for schools in areas where there is no competition for entertainment dollars other than the college athletic program may have an easier time garnering greater financial support from local businesses to fund larger NIL deals. In contrast, collectives for schools located in areas, such as Washington, D.C. or New York City, where many professional sports teams play, may find it more difficult to raise funds because endorsement and sponsorship deals from local businesses will more likely be offered to professional athletes who play on the area’s home teams.

Transfer portals—are they a form of free agency?

The transfer portal, launched by the NCAA in 2019, gives Division I student-athletes the ability to transfer to a different school and receive a scholarship without seeking permission from their current school. Upon declaring their intention to transfer, the student-athlete’s name is entered into a national database through which coaches from other schools are free to contact the student. Some observers say that the transfer portal model provides greater flexibility for the student-athlete seeking more visibility and increased playing time which another school could give. Opponents of the transfer portal raise concerns that it facilitates a system of free agency resembling that used in professional sports. There are also concerns that student-athletes entering the transfer portal could put themselves at risk of not being chosen by any school, particularly if they performed poorly during the year.

The use of NIL contracts is another factor adding to the complexity of transfer portals. Some student-athletes enter the transfer portal motivated by their desire to land a bigger NIL deal. As a result, they may not be giving enough consideration as to whether the school culture or the athletic program is a good fit. They are focusing primarily on money. There are also concerns that when a student-athlete enters the transfer portal, their academic performance may suffer because they will be missing classes while traveling to visit college campuses. This is especially problematic because student-athletes already miss classes during the college sports season because of how games are scheduled.

In recent developments, the NCAA announced on May 23, 2024, that it had reached a settlement with five major college athletic conferences on several antitrust lawsuits. According to sports analysts, the settlement would allow for revenue sharing between schools and student-athletes thus allowing them to be paid by schools. Coaches and athletic directors at universities will be watching closely as the specifics of this settlement unfold over the coming weeks and months.

For more information about degree offerings in the Sport Management program within Mason’s School of Sport, Recreation, and Tourism Management, please visit the program website.