Big Challenges Ahead as Student-Athletes Can Now be Paid

By: Casey Yang

Starting in 2023, student-athletes attending schools in California will have the legal right to be compensated for the commercial use of their name, image, and likeness (NIL) under the Fair Pay to Play Act (SB 206). Since the September 2019 signing of the bill, reactions to SB 206 have been mixed., But, stakeholders say the discussions going forward will center on measuring the value of a student-athlete’s NIL and protecting their interests.

Although SB 206 guarantees student-athletes a right to profit from their identities, compensation is limited. The bill does not create a right for student-athletes to be paid by their schools. Instead, it focuses on addressing payments by third-party businesses to use student-athletes’ identities. A contract between a business and a student-athlete is expressly prohibited under SB 206 “if a provision of the contract is in conflict with a provision of the athlete’s team contract.” Subject to specific licensing requirements, student-athletes can hire agents and other representatives in negotiating and securing commercial opportunities.

Photo by Braden Collum on Unsplash

“The application of SB 206 is challenging as it does not provide any limitations on or does not have what I would call guard rails of limitations on how it would apply,” said Patrick Dunkley, Deputy Athletics Director at Stanford, who spoke in a personal capacity and not as a representative of the school.

Even with the current limitations, outside influences pose significant challenges that are not addressed in the bill.

“One of the challenges becomes how does one value a student-athlete’s name, image, and likeness?” said Dunkley. “How do you prevent a market that then overvalues the name, image, and likeness as a means of recruiting or retaining student-athletes? It becomes a means of compensating student-athletes for either signing on at a school or playing for a school, as opposed to [compensating] for their name, image, and likeness. That’s where I think it gets very complicated.”

David Rasmussen, Senior Associate Athletic Director for Compliance at San Jose State University, personally believes schools should be completely “hands-off” when it comes to third-party compensation.

“The more the institution gets involved, the more concerns you have with equity. But if you are completely hands off, the market dictates the values of a specific student-athlete,” said Rasmussen. “Once schools insert themselves in that process they have to make sure it is equitable and make sure that opportunity is available to everybody equally.”

Kimberlee Giggey, a member of SJSU’s women’s swim team and President of the Student-Athlete Advisory Committee (SAAC) for both SJSU and the Mountain West Conference, agrees, but forecasted some gender inequality issues arising from the “hands-off” approach.

“There is not much you can do about it if you’re not approached [about compensation to use your NIL],” said Giggey.

Even though student-athletes will have the right to profit from their personal value, there is no guarantee all student-athletes of varying sports will receive any benefits.

“It’s like a job opportunity, so if you put it in that same way, not everybody is going to get that job opportunity,” she explained. Giggey believes “women are just as qualified as men to be earning the same pay,” but “having been given this opportunity is one step in the right direction.”

Overall, Giggey and other student-athletes are excited about the opportunity, but in terms of understanding SB 206 and the developments at the NCAA level, like most student-athletes she only knows the bare minimum.

The National Collegiate Athletic Association (NCAA) is a nonprofit organization that regulates student-athletes from affiliated institutions and conferences. Before the passage of SB 206, the NCAA did not allow student-athletes to benefit from their NIL, but it intends to modify its rules soon.

“We must embrace change to provide the best possible experience for college athletes. Additional flexibility in this area can and must continue to support college sports as a part of higher education,” said Michael Drake, Chair of the NCAA Board of Governors and President of The Ohio State University in a press release on the NCAA’s website. The NCAA declined to comment when contacted by The Advocate.

At SJSU, Rasmussen said he tries to “make sure [coaches] are well informed as to what [SB 206] actually means. It’s just a lot of guessing at this point and so we are all in a holding pattern to wait and see how it turns out.”

Similarly, Dunkley said he is communicating with his staff as developments arise at the NCAA level.

“We’ve had conversations with student-athletes about the issue in general, but I wouldn’t say anywhere as detailed as the internal discussions among staff,” Dunkley said. “I think right now, unfortunately, there is not a lot to report.”

Both agree that once the rules become more concrete either at the NCAA or federal level, universities should provide student-athletes with sufficient education to make informed decisions when it comes to agents, finances, and negotiations.

“Having representation to help make an informed decision is positive,” Rasmussen said. However, Rasmussen expressed concern about agents or runners who do not have the best interests of the student-athlete in mind, but are instead focused on making money.

“We would try to do as much education as possible to ensure [student-athletes] have people in their corner who have their best interests at mind,” Rasmussen said. “This calendar year is going to be crucial because [the NCAA working group] is discussing some concepts and there will be new rules proposed this year and voted on next January.”

(Editor's Note: This article was originally published in the March 2020 [Volume 50, Issue 3] version of The Advocate.)