Appeals Court Finds Student Athletes Not Employees Under FLSA

As the NCAA prepares to crown a champion for Division I football, and men’s and women’s basketball teams begin conference play, collegiate sports takes center stage this week. Lost in all the hoopla is the vast disparity between what college coaches, universities and conference make in revenues compared to what the players make.

NCAA bylaws prohibit for student athletes from receiving monetary compensation for their efforts as athletes as long as they maintain “amateur” status; meaning that they may not receive money for nearly any form of “work” performed while they are college athletes. 

In spite of this, a few students from the University of Pennsylvania sued the NCAA in federal court alleging that the NCAA violated the Fair Labor Standards Act by failing to compensate student athletes a minimum wage. They claimed that given the massive controls NCAA members had over students’ lives, they should be considered employees analogous to students who participated in work study programs.

However, an Indiana trial court disagreed, and the Seventh Circuit affirmed; claiming that according to the “economic reality” test, the students were not employees for FLSA purposes. It further reasoned that amateurism was a “long standing tradition” of college athletics and was the essential “to the very existence of” collegiate sports.

Further, the court found that the Department of Labor’s Field Operations Handbook specifically stated that student athletes were not employees under the FLSA. Nevertheless, there are many college students (who are not athletes) that may experience wage and hour problems. In these instances, an experienced employment law attorney can help. 

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