President Donald Trump has directed members of his Cabinet to develop a plan in the next 30 days aimed at preserving college sports opportunities and preventing college athletes from becoming professionals, according to an executive order he signed Thursday.
Trump’s order sets out specific guidelines for preserving athletic scholarships based on an athletic department’s annual revenue. It also declares that schools should not permit athletes to accept “third-party, pay-for-play payments.” The order states that Secretary of Education Linda McMahon should use future federal funding decisions among other tools to force schools to abide by the administration’s policy.
The NCAA always has prohibited pay-for-play payment from third parties. In the past several years, college sports leaders have struggled to find ways to stop boosters at the industry’s wealthiest schools from paying athletes via contracts that are endorsement deals on paper but function in reality as de facto salaries.
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“A national solution is urgently needed to prevent this situation from deteriorating beyond repair and to protect non-revenue sports, including many women’s sports, that comprise the backbone of intercollegiate athletics,” Trump stated in the order.
The executive order states that endorsement deals from third parties should continue to be permitted so long as they reflect a “fair market value.”
The Power 4 conferences launched a new enforcement agency this month — the College Sports Commission — in an effort to vet all third-party deals athletes sign to make sure they are reasonable payments for endorsements rather than a veiled pay-for-play arrangement. It’s not yet clear if or how the administration’s new policy could help strengthen those efforts.
The NCAA’s long-held prohibition on paying athletes has crumbled in the past decade under pressure from a litany of legal challenges and state laws. The association and its power conferences formally agreed to an antitrust settlement in June that will allow schools to pay up to $20.5 million directly to their athletes in the coming academic year. Those payments are also designated as endorsement contracts on paper but likely will serve as de facto salaries.
Steve Berman, one of the co-lead plaintiff attorneys in the antitrust settlement, criticized Trump for trying to intervene.
“Plain and simple, college athletes don’t need Trump’s help, and he shouldn’t be aiding the NCAA at the expense of athletes,” Berman said last week. “… As a result of our case, college athletes are now free to make their own deals. For Trump to want to put his foot on their deal-making abilities is unwarranted and flouts his own philosophy on the supposed ‘art of the deal.'”
NCAA president Charlie Baker said the association still will need help from federal lawmakers to create competitive balance in college sports. Specifically, Baker and other college sports leaders have asked Congress to provide them with an antitrust exemption so they can enforce rules, many of which would limit athlete earning power.
“The Association appreciates the Trump Administration’s focus on the life-changing opportunities college sports provides millions of young people and we look forward to working with student-athletes, a bipartisan coalition in Congress and the Trump Administration to enhance college sports for years to come,” Baker said in a statement regarding Trump’s executive order Thursday.
A presidential executive order cannot provide antitrust protection for the NCAA. However, a bill that would give the NCAA broad antitrust leeway was approved by two different House committees this week. It could be called for a full vote in the House of Representatives as soon as September. The bill, which has received very little support from Democrats, still would need to pass through the Senate.
Thursday’s executive order mandates that athletic departments that brought in more than $125 million during the last academic year must increase the number of scholarships they provide to athletes in non-revenue sports. Athletic departments that brought in at least $50 million cannot reduce the number of scholarships they offer in those sports.
The overwhelming majority of schools in the four power conferences reach the $50 million threshold, while roughly 30 to 40 schools have topped the $125 million mark in recent years. Many of those highest earning schools have already publicly announced plans to increase their scholarship totals.
The order also calls on the Secretary of Labor and the National Labor Relations Board to clarify college athletes’ employment status in a way that will “maximize the educational benefits and opportunities” for all athletes. It does not provide any specific timeline for those agencies to act.
As schools begin paying their athletes, college sports leaders remain adamantly opposed to treating them as employees. Those leaders say that many schools could not afford to field the same number of teams if all athletes are declared to be employees. They also say most college athletes do not want to be employees.
Two separate groups of athletes have asked the NLRB to recognize them as employees in the past two years. Both cases were dropped shortly after Trump was elected. If the NLRB declares college athletes are not employees, future athletes will not be able to form a union and bargain for more money or better working conditions.
Several football coaches have recently said they believe it would make more sense — and provide more stability — if their players were considered employees and were able to collectively bargain.
“The best way to do it is to make it where players are employees and you have a salary cap,” Louisville coach Jeff Brohm told ESPN earlier this month. “If players are getting paid, why don’t we just do it the correct way? The amateurism isn’t there anymore. Let’s not pretend that it is.”
There is one ongoing federal case (Johnson v. NCAA) that argues athletes should be considered employees under the Fair Labor Standards Act. The plaintiff’s attorney in that case, Paul McDonald, has previously argued that any action that blocks college athletes from being employees would be unconstitutional because it would treat the work athletes do as different than the work of other students who hold campus jobs.
