Reforms at Universities - Athletes Should Receive Compensation Literature Review

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¶ … college and universities should undergo reform, and that athletes should receive compensation from their institutions of higher learning is not a new idea. It's been around for many years, and the arguments pro and con have been hashed out in meaningful ways by untold thousands of scholars, economists, journalists, athletes and others. This paper presents many of those points-of-view, and takes the position that indeed, college / university athletes, in certain circumstances, should be paid for their efforts.

Notre Dame Law Review -- Play and be Paid?

Lee Goldman explained 25 years ago that the bowl games in the 1988-89 collegiate football season netted $66 million - $53 million of which went to the schools that participated in those bowl games. That pales in comparison to what the teams and conferences in the BCS playoffs received in 2014-2015. According to the website Business of College Sports, a total of $403 million was paid out to the SEC, the Big XII, the Big Ten, the Pac-12, the ACC and the Group of Five (American, C-USA, MAC, Mountain West and Sun Belt conferences). That does not include local television money, local and national sponsorship revenue that individual schools collect.

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Moreover, the editor, Kristi Dosh, reminds readers of the website that all these millions of dollars that resulted from BCS games "...go to the conference, not to the team playing in the game," and most conferences "split it equally…with an equal share going to the conference office… [Albeit] some conferences give a bonus to the team participating in the game" (Dosh, 2014).

TOPIC: Literature Review on Reforms at Universities - Athletes Should Receive Compensation Assignment

As for Goldman's take on the issue in 1990, he notes that great success in sports programs create prestige and notoriety, resulting in generous alumni donations and increased enrollment. Admittedly Goldman's numbers and facts are out of date, but nonetheless he pointed out in 1990 that "It is inequitable that student-athletes, who generate millions of dollars for the university, must scrounge for basic expenses and struggle through their classes." He went on to assert that it is "hypocritical" for the NCAA to not pay student athletes while universities constantly seek new ways to increase revenues (Goldman, 1990).

NCAA Schools Can "Absolutely Afford to Pay College Athletes"

Fast forward twenty five years from Goldman's piece and in some ways the story remains the same. To wit, journalist Maxwell Strachan writes that notwithstanding the NCAA and its member institutions' assertion that they cannot afford to pay college athletes, there is a "growing chorus of critics" who insist these schools can indeed afford to share compensation with their athletes (Strachan, 2015).

Strachan asked NCAA spokeswoman Meghan Durham about the financial situation vis-a-vis paying student athletes; Durham said that "…only 20 of the roughly 1,100 schools that constitute the NCAA make more from sports than they spend on sports" (Strachan, p. 1). Even sports giant ESPN claims that of the teams that were in the "March Madness" tournament in 2014, more than two-fifths "…either broke even or lost money last year" (Strachan, p. 2).

However, when Strachan contacted five sports economists as to whether the NCAA and the colleges it oversees could afford to pay student athletes, the response was "quite different," he said. The response was "a resounding yes," and some of the economists were "almost surprised by the question" because the answer "seemed so obvious to them" (Strachan, p. 2).

"It's pretty clear that they would be able to," according to Southern Utah University economics professor David Berri. "I don't see any reason that they wouldn't be able to, in fact." Strachan asked the professor about the argument that if schools are losing money, or breaking even, if they have to pay some labor costs vis-a-vis the players' compensation, "…won't additional costs hurt those programs and the schools?"

Berri replied, "That's a silly argument. They're nonprofits, and their incentive is to spend every cent that comes in…that doesn't mean they aren't making money. That just means they spent all of it," Berri asserted (Strachan, p. 2). Schools are set up to spend the money that comes in, which is why the Duke athletic program took in $80 million in a recent fiscal year and yet Duke ended up with $146,000 in "excess revenue," Strachan reports. And the NCAA took in $989 million in the last fiscal year, but ended up with a paltry $80 million in "surplus."

The fact that nonprofits take in a lot of money and spend it on state-of-the-art sports facilities, and pay coaches like Mike Krzyzewski "nearly $10 million a year" (Strachan, p. 3), doesn't of course preclude them from also paying athletes a decent stipend. Paying the players would simply be "a reallocation of sources," the economists told Strachan. Moreover, sports economist Stefan Szymanski (University of Michigan) said one possible roadblock for players being compensated is that coaches salaries might take a hit, which may explain why "…some coaches so vehemently oppose the idea of a system in which players get paid" (Strachan, p. 3).

Scholarship Players are Employees -- Right? Wrong?

In the Autumn of 2014 the Regional Director of the National Labor Relations Board (NLRB) asserted that scholarship football players from Northwestern University are indeed employees of the University. And under the NLRB's Section 2(3) of the law that established the NLRB, according to Regional Director (not named in the article) the football players are not only employees but in fact "…those who receive grant-in-aid scholarships and have not exhausted their NCAA playing eligibility can vote whether to form a union" (D'Aquila, et al., 2014).

Imagine the chagrin expressed by NCAA officials and university executives nationwide if football players that receive full ride scholarships (and other perks) would actually begin forming players' unions. This would truly cause an upset of the college football's money-making applecart. One can imagine the rancor and vitriol that would be forthcoming in rhetoric and legal actions as well.

Meanwhile, the NLRB decision is based on the fact that football players receive scholarships and living expenses as "compensation" in exchange for their "football-related services" to the university (D'Aquila, 37). Because these players are compensated for their participation, they are subject to "a high degree of control by Northwestern's football coaches," and if they don't produce or violate rules, they can be dismissed, or fired, is another applicable word, D'Aquila continues (37).

The NLRB pointed out that besides the full ride scholarships players receive, the university also pays for players' "…tuition, fees, room, board, and books for up to five years"; and upperclassmen can live off campus and to pay for their living costs they receive a monthly stipend "…between $1,200 and $1,600" for expenses (D'Aquila, 38). Those benefits, while not provided in a typical paycheck, can add up to $76,000 a year, the NLRB explained in its 2014 decision.

Over a four-to-five-year period, the Regional Director explained, football players' compensation can be "…in excess of one quarter of a million dollars"; and while players don't sign traditional contracts, they do sign what is called a "tender," which identifies the conditions under which the university "…may reduce or cancel the scholarship" (D'Aquila, 38). Can Northwestern afford to pay these players? According to the NLRB decision, between 2003 and 2012, the university generated $235 million in revenue and had $159 million in expenses based on the football program alone, D'Aquila continued.

The university has appealed the decision, and it may end up in the U.S. Supreme Court, but meantime, the NCAA has weighed in, as expected.

The NCAA Rebuts the NLRB Decision

NCAA president Mark Emmert took issue with the NLRB's decision that student athletes are employees of the universities where they play. He was quoted as saying the NLRB decision was "silly…There is no one I have talked to in intercollegiate athletics who thinks that the idea of converting student-athletes into employees is a good idea" (Geary, 2014).

Emmert, formerly the president of the University of Washington, went further in his remarks in opposition to the NLRB's decision:

"As a university president, if I was going to hire you to play football for me, why on God's earth would I want you to be a student? I'm paying you to win football games for me; the last thing I want you to do is be bothered with class time.

If you're a football player, you're a football player. Why would I pay you to do both? It makes utterly no sense."

Meantime, while the debate goes on, Northwestern University football players voted in early 2014 to form a labor union for college athletes. But Emmert didn't totally shoot down the idea of helping players financially beyond what they now receive. He suggested paying football players (and presumably other student athletes) "…a stipend to cover miscellaneous expenses" (Geary, p. 1).

Emmert noted that the "demands" are great on student athletes; so, because players put a lot of time in for study and football practice, "…the opportunities for work jobs are hard and limited." Hence, the NCAA president suggested a stipend of between… [END OF PREVIEW] . . . READ MORE

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Reforms at Universities - Athletes Should Receive Compensation.  (2015, May 14).  Retrieved September 17, 2021, from

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"Reforms at Universities - Athletes Should Receive Compensation."  May 14, 2015.  Accessed September 17, 2021.