NCAA moves toward allowing student-athletes to earn money from endorsements and promotions

In an unprecedented move, the NCAA’s governing body takes steps to enable student-athletes to earn compensation for their name, image, and likeness. The following is the full release from the organization:

At its meeting this week, the Board of Governors supported rule changes to allow student-athletes to receive compensation for third-party endorsements both related to and separate from athletics. It also supports compensation for other student-athlete opportunities, such as social media, businesses they have started and personal appearances within the guiding principles originally outlined by the board in October.

While student-athletes would be permitted to identify themselves by sport and school, the use of conference and school logos, trademarks or other involvement would not be allowed. The board emphasized that at no point should a university or college pay student-athletes for name, image and likeness activities.

The board directed all three divisions to consider appropriate rules changes based on recommendations from its Federal and State Legislation Working Group.

“Throughout our efforts to enhance support for college athletes, the NCAA has relied upon considerable feedback from and the engagement of our members, including numerous student-athletes, from all three divisions,” said Michael V. Drake, chair of the board and president of Ohio State. “Allowing promotions and third-party endorsements is uncharted territory.”

The board’s recommendations now will move to the rules-making structure in each of the NCAA’s three divisions for further consideration. The divisions are expected to adopt new name, image and likeness rules by January to take effect at the start of the 2021-22 academic year.

The board is requiring guardrails around any future name, image and likeness activities. These would include no name, image and likeness activities that would be considered pay for play; no school or conference involvement; no use of name, image and likeness for recruiting by schools or boosters; and the regulation of agents and advisors.

The board’s action is the latest step by the Association to support college athletes and modernize its rules regarding name, image and likeness. In October, the board identified guiding principles to ensure that any changes support college sports as a part of higher education. Any changes adopted by the divisions must be in concert with the following principles and guidelines:

• Ensuring student-athletes are treated similarly to nonathlete students unless a compelling reason exists to differentiate.
• Maintaining the priorities of education and the collegiate experience to provide opportunities for student-athlete success.
• Ensuring rules are transparent, focused and enforceable, and facilitating fair and balanced competition.
• Making clear the distinction between collegiate and professional opportunities.
• Making clear that compensation for athletics performance or participation is impermissible.
• Reaffirming that student-athletes are students first and not employees of the university.
• Enhancing principles of diversity, inclusion and gender equity.
• Protecting the recruiting environment and prohibiting inducements to select, remain at or transfer to a specific institution.

The board relied on a comprehensive report from the Federal and State Legislation Working Group to inform its recommendations.

“The NCAA’s work to modernize name, image and likeness continues, and we plan to make these important changes on the original timeline, no later than January 2021,” said Gene Smith, Ohio State senior vice president and athletics director and working group co-chair. “The board’s decision today provides further guidance to each division as they create and adopt appropriate rules changes.”

In its report, the working group recognized that the rules needed to accomplish the modifications may differ by division and stressed the need for appropriate regulation in the future.

“As we evolve, the Association will continue to identify the guardrails to further support student-athletes within the context of college sports and higher education,” said Val Ackerman, commissioner of the Big East and working group co-chair. “In addition, we are mindful of the impact of the COVID-19 pandemic on higher education, college sports and students at large.  We hope that modernized name, image and likeness rules will further assist college athletes during these unprecedented times and beyond.”

The board also discussed the potential challenges to modernizing rules posed by outside legal and legislative factors that could significantly undermine the NCAA’s ability to take meaningful action. As a result, it will engage Congress to take steps that include the following:

• Ensuring federal preemption over state name, image and likeness laws.
• Establishing a “safe harbor” for the Association to provide protection against lawsuits filed for name, image and likeness rules.
• Safeguarding the nonemployment status of student-athletes.
• Maintaining the distinction between college athletes and professional athletes.
• Upholding the NCAA’s values, including diversity, inclusion and gender equity.

The recommendations for federal engagement were provided by the Presidential Subcommittee on Congressional Action, which was formed as part of the Federal and State Legislation Working Group to provide input on the potential assistance the NCAA should seek from Congress.

“The evolving legal and legislative landscape around these issues not only could undermine college sports as a part of higher education but also significantly limit the NCAA’s ability to meet the needs of college athletes moving forward,” Drake said. “We must continue to engage with Congress in order to secure the appropriate legal and legislative framework to modernize our rules around name, image and likeness. We will do so in a way that underscores the Association’s mission to oversee and protect college athletics and college athletes on a national scale.”

NCAA’s Questions and Answers on Name, Image and Likeness

 

What is the latest development on name, image and likeness rules for student-athletes?

The NCAA Board of Governors took another important step forward at its April 28, 2020 meeting by outlining specific categories in which student-athletes could earn compensation from their name, image and likeness within certain categories.

What specific elements did the Board of Governors approve at its April 28, 2020 meeting?

The board approved the areas for modernizing name, image and likeness rules for student-athletes. When approved by the NCAA membership, these rules would allow:

• Compensation for third-party endorsements related to athletics, without school or conference involvement.
• Compensation for other student-athlete opportunities, such as social media, new businesses, and personal appearances, without institutional involvement or the use of trademarks/logos.

The board emphasized that at no point should a school pay student-athletes for name, image and likeness activities.

What about guardrails for future name, image and likeness activities for student-athletes?

The board is requiring guardrails around any future name, image and likeness activities. These would include no such activities that are pay for play or have any school or conference involvement; no use of name, image and likeness for recruiting by schools or boosters; and the regulation of agents and advisors.

What happens next?

By the end of August 2020, each NCAA division should have initial legislative proposals to allow NIL activities approved now by waivers or rules interpretations and related to businesses or other opportunities not tied to athletics. By the end of October 2020, each division should have final legislation drafted to update NIL rules. Legislation should be approved by Jan. 31, 2021, with effective dates no later than the start of 2021-22 academic year.

What is the status of the Federal and State Legislation Working Group?

The working group was created to represent the breadth and diversity of the NCAA membership and provide feedback from across the Association. The group provided updated recommendations to the Board of Governors in April. Its work is now finished, and it will no longer meet.

What did the Presidential Subcommittee on Congressional Action recommend regarding Congress?

Formed as part of the Federal and State Legislation Working Group, the presidential subcommittee was directed to provide input on the potential assistance the NCAA should seek from Congress to support the modernization of rules.

The subcommittee’s recommendations were adopted by the Board of Governors and call for engaging Congress on the following items:

• Action to preempt various state legislation on name, image and likeness.
• Establishing a “safe harbor” for the Association to provide protection against lawsuits filed for name, image and likeness rules.
• Safeguarding the nonemployment status of student-athletes.
• Maintaining the distinction between college and pro sports.
• Upholding NCAA values, including diversity, inclusion and gender equity.

The subcommittee also recommended supporting broader modernization of NCAA rules in student-athlete well-being, including academics, health and safety, and overall campus experience.

Are the three NCAA divisions going to develop separate approaches versus one NCAA approach for all student-athletes?

Yes. The Board of Governors directed each division to create rules using the principles and guidelines it approved in October 2019 and the recommendations it approved April 28, 2020. There are many examples now where each NCAA division has different rules, including in areas such as recruiting, financial aid, and playing and practice seasons. As a fundamental framework of the Association, member schools choose the division in which they compete and agree to follow the rules within that division. All three divisions will implement changes consistent with the principles within the NCAA constitution and endorsed by the Board of Governors.

Why didn’t the NCAA address this issue before now?

NCAA members continually strive to improve the student-athlete experience, including paying close attention to the changing environment of the student body and within higher education. After taking action to improve academic support, provide the cost of attendance, guarantee scholarships and strengthen health and safety, among many changes, the NCAA membership determined that exploring this issue was an important next step to support student-athletes. NCAA leadership also determined that the membership must respond to federal and state legislative proposals that would be harmful to a national, uniform college athletics model.

How does the uniqueness of the college sports recruiting environment affect this issue?

Recruiting is one of the key principles that sets the college student model of sports apart from professional sports. Changes to name, image and likeness rules for student-athletes should support the integrity of the recruiting environment and not result in any undue influence on a student’s choice of where to attend college.

Why does the NCAA oppose newly enacted California Senate Bill 206 and other potential state or federal legislation on the name, image and likeness of college athletes?

It is critical that college sports are regulated at a national level. This ensures the uniformity of rules and a level playing field for student-athletes. The California law and other proposed measures ultimately would lead to pay for play and turn college athletes into employees. This directly contradicts the mission of college sports within higher education — that student-athletes are students first and choose to play a sport they love against other students while earning a degree.

The NCAA said California SB 206 and other state laws or proposals may be unconstitutional. Is the NCAA challenging them in court?

We believe the actions taken by California and other states are unconstitutional, and the actions proposed by other states make clear the harmful impact of disparate sets of state laws.  None of the passed laws have become effective yet. The NCAA is closely monitoring the approaches taken by state governments and the U.S. Congress and is considering all potential next steps.