College athletes are employees

[Arkpony]

A federal appeals court ruled all college athletes may be treated as employees. College athletics takes another step into irrelevance.

[BUS]

Don't you think this will be appealed?
IMHO the courts are a mess.

[Lotus]

What's to appeal? It was ruled this year that schools can pay athletes directly. That effectively makes them employees.

For the lawyers out there: if athletes are employees, are scholarships taxable? Or just NIL deals?

[DiamondM75]

This has royally screwed up college athletics. The next step will be athletes no longer have to be enrolled at the university and attend classes. They are now employees of the university just like professors, maintenance personnel, cafeteria workers, etc.

[ponyte]

Good. This increases the cost of business and that favors those schools with the money to meet that increase cost. I believe we fare well in an increase cost environment for the best players.

The days of the horse and buggy are over and we need to be innovative participants in the new environment. Paying players has always been a big business in the NCAA. Now we have a chance to turn it into an upfront business and the NCAA can't arbitrarily screw us.

[Drum Major]

The other way this benefits us is that these new employees, like the NBA and NFL players, may start to consider what states they want to play in based on taxation of their income. Maybe more recruits say no to the west coast and head this way. Of course it's hard to picture all of these "kids" with W-2's paying their taxes and staying on top of all of the rules. I assume the schools will start hiring their own tax preparers to help the athletes stay out of trouble, just like the academic advisors provide tutoring, etc.

[Otto]

I was wondering about that. I would assume tax liability would be a major part of the sales pitch to a kid describing being torn between two schools. The 18-year-old might not really wrap his head around the differences, but hopefully the tax experts mentioned above can break it down in great detail.

[PlanoStang]

I would hope they would keep the requirement that you have to be taking a full load of classes at the school you play for. Also maintain the required GPA in real classes, UNC comes to mind, and make progress towards a real degree.

Employee status would be the same as if you are a dorm RA, or work in the cafeteria, library etc.

[malonish]

I am unaware what is in the Life After Ball program but you'd think they would have tax information in that program.

Maybe it should be a part of high school curriculum instead of just how the mitochondria is the powerhouse of the cell.

[HubbaHubba]

[birddogger]

I’m less enthusiastic about the ruling, although it is likely the correct one based on how the IRS defines an “employee.”

Looking beyond SMU, this is going to create financial hardships for some G5s and smaller programs.

Being cast as an employer will necessarily require universities to incur costs such as: admin costs to withhold taxes and issue W-2s, offer pension/retirement plans (if a state university) or 401ks (if private college), provide Workers Compensation insurance (expensive as many of you know), and provide health coverage (really costly).

For public schools, athletes are public employees. Are they subject to civil service? Can athletes form unions? (yes). And how does this work with Title IX if every athlete is now an employee?

Most large public schools affiliated with the Power conferences will likely not be affected, although this new overhead will take a big bite out of those TV revenues. And it will take a big bite out of our budget, too. But I fear more for the directional schools and small privates. They will face a day of reckoning and we’ll see the end of many football programs and other scholarship sports.

[SMU Pom Mom]

I would imagine most universities already use a payroll company for work study employees. It's shouldn't be a big deal to add athletes. As for taxes, full scholarships are only tax free for tuition and books. The room and board part is taxable income.