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Third Circuit Court of Appeals to Determine Whether Student-Athletes Can Be Classified as “Employees” Under FLSA | Steptoe & Johnson LLC

By on March 25, 2022 0

Since last year’s landmark SCOTUS ruling at Alston limiting the NCAA’s ability to limit student-athlete compensation for certain educational benefits, the landscape continues to change in unprecedented ways. Now, the Third Circuit Court of Appeals will decide whether student-athletes can be classified as “employees” under the Fair Labor Standards Act (FLSA), mandating minimum wage and overtime pay for individuals. covered by law.

In Johnson, et al., v. NCAA, et al., a group of Division 1 student-athletes filed a lawsuit alleging that student-athletes are “employees” and therefore entitled to a payment under the FLSA. The NCAA filed a motion to dismiss the lawsuit, which was denied by the district court.

The district court rejected the NCAA’s amateurism argument, finding it unconvincing and cyclical to argue that student-athletes are amateurs simply because schools have established a tradition of not paying them. The district court also declined to find that sports programs could be considered “extracurricular activities” because college sports programs, which generate millions of dollars in revenue each year for schools, often interfere with the ability of the student to make the most of academic opportunities. .

Finally, the court applied the “economic facts test” and determined that certain relevant factors, such as the connection between the program and the student’s formal education, the fact that the program meets the academic commitments of the student and whether the student’s extracurricular activities complement rather than replace the work of paid employees, weighed in favor of finding students as employees. Therefore, the district court determined that the students made a plausible allegation that they were employees under the FLSA.

The Third Circuit will address the issue of whether student athletes can be classified as “employees” under the FLSA. If the appeals court answers that question in the affirmative, the floodgates could open for further litigation and a possible extension of other labor law protections to student-athletes. This case represents one of many recent developments in collegiate sports that could usher in change on an extraordinary scale. For the world of higher education, this will certainly be an important development to follow.