Key Points: Are College Athletes Employees?
- Schools began paying athletes directly through revenue sharing on July 1, 2025, with Division I programs distributing up to $20.5 million per year
- Top quarterbacks in the 2026 transfer portal commanded $5-6 million, exceeding many NFL rookie salaries
- 82% of Division I schools opted into the new system, creating professional league infrastructure with salary caps, roster limits, and centralized enforcement
- Athletes remain classified as non-employees despite receiving direct compensation, avoiding minimum wage protections, and unionization rights
- Legal battles over employment status and Title IX compliance will shape the future of college athletics through at least 2027
Lane Kiffin flew to Knoxville in January 2026 to intercept a quarterback who had just committed to LSU. Not to coach him. To outbid Tennessee in a live auction for his services. The price tag landed around $6 million for Sam Leavitt, a redshirt sophomore who’d thrown 36 career touchdown passes.
Welcome to college football in 2026, where the charade finally ended, but nobody wants to admit it out loud.
On July 1, 2025, college sports crossed a threshold it had been approaching for years. Schools started writing checks directly to athletes through revenue-sharing agreements that look, sound, and function exactly like professional sports payroll systems. The House v. NCAA settlement authorized Division I programs to distribute up to 22% of Power 5 average athletic revenues—equaling $20.5 million in the first year—with that number climbing to roughly $33 million by 2034.
This isn’t some incremental change in the name, image, and likeness landscape. This is the complete professionalization of college athletics, packaged with salary caps, roster limits, centralized enforcement, and multi-million dollar player contracts. The only thing missing is honest language about what everyone knows is true: college sports have become a professional enterprise, and the people running them are doing everything possible to avoid saying so.
The Money Tells the Story About “Student-Athletes”
Follow the dollars and the truth becomes unavoidable. In the 2025-26 academic year, Division I athletes will receive approximately $2.3 billion in combined revenue sharing and NIL compensation. Schools that opted into the House settlement—82% of Division I programs—committed to distributing portions of their media rights, ticket sales, and sponsorship revenues directly to the athletes generating them.
Power 4 schools immediately maxed out their revenue-sharing allocations. LSU didn’t stop there. After securing their $6 million quarterback in January 2026, the Tigers continued to assemble their most expensive roster in Tiger history through the transfer portal. Texas Tech’s roster reportedly cost more than $28 million in 2025. These aren’t outlier programs gaming the system. This is the new baseline for schools serious about competing.
The quarterback market alone demonstrates how far removed college sports are from anything resembling amateurism. Top signal-callers command between $3 million and $6 million for a single season in the 2026 transfer portal cycle. Brendan Sorsby signed with Texas Tech for $5 million. When quarterbacks who haven’t taken an NFL snap earn more than mid-round NFL draft picks, the amateur label becomes absurd on its face.
Consider what that means in practical terms. Jaxson Dart, selected 25th in the 2025 NFL Draft, signed a four-year deal paying roughly $4.2 million per season. Sam Leavitt and Brendan Sorsby will make more than Dart in 2026 while playing college football. The New Orleans Saints’ starting quarterback, Tyler Shough, earns around $2.7 million per year. College athletes at premier programs are now making more than professional athletes at the next level.
2026 Transfer Portal Market Rates by Position:
- Elite quarterbacks: $3-6 million
- Top offensive tackles: $3-4 million
- Elite wide receivers: $1-2 million (up to $4 million in bidding wars)
- Premier defensive ends: $3 million
- Average SEC starting quarterback: $600,000 (doubled from $300,000 in 2025)
Team Transfer Portal Budgets for 2026 (Per SportsCasting):
- Texas: $23 million available
- Ohio State: $20 million
- Texas A&M: $18 million
- Texas Tech: $11 million
These figures are in addition to the $20.5 million revenue-sharing cap, which was intended to bring spending under control. It didn’t.
Professional League Infrastructure Without the Honesty
The House settlement didn’t just open the checkbook. It created the structural framework of a professional sports league while maintaining the fiction that participants aren’t employees.
The New Professional Systems:
Salary Caps: Schools can distribute up to 22% of Power 5 average athletic revenues each year, capped at $20.5 million for the 2025-26 academic year. That cap increases roughly 4% annually over the settlement’s ten-year term. This is identical in function to the salary cap systems in the NFL, NBA, and NHL, which are designed to promote competitive balance by preventing the richest programs from spending without limits.
Roster Limits: Instead of restricting how many athletes receive scholarships, the settlement imposed hard caps on the number of athletes who can be on each team’s roster by sport. These limits mirror the roster-construction rules in professional leagues, where teams balance depth with the cost of maintaining large rosters.
Centralized Enforcement: The College Sports Commission emerged as the first centralized enforcement body in college athletics. The CSC monitors revenue-sharing compliance, reviews NIL deals exceeding $600 to ensure they serve “valid business purposes,” and has the authority to levy penalties on programs that violate the new rules. This is the functional equivalent of the commissioners’ offices in professional sports, existing to maintain competitive integrity and enforce agreed-upon rules. There are rumors that this monitoring is going about as well as you might think.
NIL Deal Regulation: All NIL deals exceeding $600 must be submitted to the NIL Go clearinghouse for approval. The CSC evaluates whether compensation reflects fair market value and whether the deal serves a legitimate business purpose, seeking to distinguish genuine endorsements from pay-for-play arrangements masked as NIL contracts.
Free Agency System: The transfer portal functions as free agency. Athletes can enter during a designated window, negotiate with programs offering the best combination of playing time and compensation, and move between schools with minimal restriction. The 2026 cycle eliminated the spring transfer window entirely, consolidating all movement into a single 15-day January period that operates with the urgency and intensity of NFL free agency. Except in the NFL, players usually sign multi-year contracts. In college football, roster management is handled year to year.
Every structural element of professional sports now exists in college athletics. The only missing piece is the straightforward acknowledgment that the people being paid millions of dollars to perform athletic services are employees.
The College Athlete Employment Question Everyone’s Avoiding
Call someone an employee and the legal landscape shifts entirely. Employees get minimum wage. Overtime pay. Workers’ compensation. The right to unionize and bargain collectively. Employee status triggers Title IX obligations, potentially requiring equal compensation across men’s and women’s sports. It opens athletic departments to labor law, employment discrimination statutes, and regulatory frameworks designed for employer-employee relationships.
So, despite paying athletes like employees, controlling their time like employees, and building professional league infrastructure around them, schools fight desperately to avoid the label.
Johnson v. NCAA established a four-prong test for determining whether college athletes qualify as employees under the Fair Labor Standards Act. The Third Circuit ruled in mid-2024 that athletes could meet the test if they:
- Perform services for another party
- Perform those services primarily for that party’s benefit
- Work under that party’s control or right of control
- Receive express or implied compensation or in-kind benefits in return
Before the House settlement, athletes struggled to satisfy the compensation prong. Revenue sharing changed the calculation. Schools now pay athletes directly from revenues generated by their athletic performance. Athletes receive checks from their universities for playing sports. That’s employment by any conventional definition, yet the case remains unresolved and will likely extend through 2027 at a minimum before reaching a definitive conclusion.
Universities are paying athletes millions of dollars, controlling their schedules, dictating their obligations, and structuring entire departments around managing their services. The only thing preventing them from being employees is semantic resistance from the institutions writing the checks.
The Unionization Efforts That Hit a Wall
Athletes organizing for collective bargaining rights represent the logical endpoint of professionalization. If college sports function like professional leagues, athletes should have the same rights as players in the NFL, NBA, NHL, and MLB to collectively negotiate wages, working conditions, and the rules governing their employment.
The Dartmouth men’s basketball team voted to unionize in early 2024, and a regional director of the National Labor Relations Board ruled they qualified as employees under the National Labor Relations Act. The decision marked a significant victory for athlete advocates who’d spent years arguing that college athletes deserved the same labor protections as other workers.
That momentum evaporated in January 2025. The Dartmouth case was withdrawn. So was the USC complaint filed by the National College Players Association on behalf of Trojan athletes. Both cases closed within days of each other as the Trump administration prepared to take control of the NLRB, which handles employment disputes at private institutions.
Structural Obstacles to College Athlete Unionization:
- Jurisdictional limitations: The NLRA covers only private employers, excluding most Division I programs at public universities
- State law variations: Some states prohibit public employee collective bargaining; others allow it under specific conditions
- Fragmented employer structure: Professional leagues bargain through single employer entities; college athletics operates through hundreds of independent institutions
- Mixed public-private conferences: Many conferences include both public and private schools under different state laws
- No unified bargaining unit: No single organization has the authority to represent all college athletes
Athletes.org, an organization representing roughly 5,000 college athletes as of early 2026, released a blueprint for what collective bargaining in college sports might look like. But releasing a proposal isn’t the same as achieving recognition, and without a clear path through either the NLRB or state labor boards, the unionization push stalled.
Some athletic directors have begun suggesting that collective bargaining might be the only way to create enforceable rules with legal protection from antitrust challenges. Professional leagues operate under the non-statutory labor exemption, which shields their collective bargaining agreements from antitrust scrutiny. The NCAA has no such protection, leaving nearly every rule vulnerable to legal challenge. But acknowledging that collective bargaining would solve problems requires recognizing that athletes are employees, and no one with decision-making authority wants to make that leap.
The Title IX Time Bomb
Revenue sharing created a problem that schools are still figuring out how to handle. Title IX requires educational institutions receiving federal funding to provide equal opportunities to male and female students, including in athletics. How does a school distribute $20.5 million while complying with equal opportunity requirements?
The settlement is silent on allocation methodology. It caps total amounts but provides no guidance on how to divide money between sports or genders. Athletic directors make decisions that could expose their institutions to legal liability under either Title IX or employment discrimination statutes.
Some schools have already allocated the majority of revenue sharing to men’s sports, particularly football and men’s basketball, using professional sports logic—compensation tracks revenue generation. But Title IX focuses on equal opportunity, not market-based compensation. If revenue sharing falls under Title IX’s athletics provisions, gender-based differences in allocation could constitute discrimination regardless of which sports generate revenue.
Employee status might change the calculus. If athletes are employees, Title IX’s employment provisions could apply rather than its athletics provisions. Employment law generally permits different compensation based on revenue generation and market value. But athletes aren’t officially employees yet, so which framework applies remains unclear. Schools are gambling on how courts will eventually interpret Title IX’s application to revenue sharing.
The Biden administration’s Department of Education issued guidance in 2025 stating that revenue-sharing arrangements should comply with Title IX’s equal opportunity requirements. That guidance was rescinded. Without clear regulatory direction, schools are making multi-million dollar allocation decisions in legal gray zones that will inevitably be challenged and litigated.
Where Different Stakeholders Land
The transformation to professional athletics doesn’t affect everyone equally. Winners and losers are already emerging as the new system takes shape.
Power 4 Schools: Maximize revenue sharing immediately and maintain significant competitive advantages. Their media rights deals, stadium revenues, and donor bases support both the $20.5 million revenue share and substantial additional NIL spending through collectives. Programs like Texas, Ohio State, and LSU operate with combined budgets exceeding $40 million for roster construction when revenue sharing and NIL are combined.
Non-Power Schools: Face impossible math. The revenue sharing cap is the same $20.5 million for all Division I institutions, but most programs outside the Power 4 don’t generate enough revenue to afford full participation. A school pulling $30 million in total athletic revenue can’t allocate $20.5 million to athlete compensation without gutting the rest of the department. Many programs opted into revenue sharing but can’t afford to fully capitalize on it, creating a permanent competitive disadvantage.
Olympic Sports: Exist in perpetual uncertainty. The revenue-sharing model doesn’t specify allocations by sport, but the money flows primarily from football and basketball media rights. Athletic directors deciding how to allocate limited resources face pressure to focus spending on revenue-generating sports, at the expense of Olympic programs that may not generate enough revenue to justify their costs in a professionalized system.
Women’s Sports: Occupy an ambiguous position. Title IX provides some protection against the loss of resources, but whether that protection extends to revenue-sharing allocations remains unclear. Women’s basketball has grown in popularity and commercial appeal, potentially positioning it to capture a larger share of revenue. But most women’s sports don’t generate revenue comparable to that of football and men’s basketball, leaving them vulnerable if compensation is tied strictly to revenue.
Athletes: Receive more money but no employee protections. They’re getting paid like professionals without minimum wage guarantees, overtime protections, workers’ compensation, or the right to collectively bargain over working conditions. They can be cut from rosters, have scholarships revoked, or be subject to rules they have no voice in creating. The money is real, but the labor protections that typically accompany professional employment don’t exist.
Smaller Division I Programs: Face existential questions. Schools in conferences without lucrative media deals, playing in modest facilities, serving regional fan bases—they opted into revenue sharing to remain competitive but lack the resources to keep pace with Power 4 spending. The gap between the richest and poorest Division I programs was already significant. Revenue sharing and unrestricted NIL spending are accelerating that separation into a chasm.
Circumventing the Cap Before the Ink Dried
The $20.5 million revenue-sharing cap was supposed to create spending limits and promote competitive balance. Schools found workarounds immediately.
NIL collectives rushed to frontload deals for the 2025-26 academic year before July 1, 2025, when the College Sports Commission’s enforcement began. By distributing funds before the deadline, collectives avoided payments that would have counted against the revenue-sharing cap or flowed through the NIL Go approval system. This created a one-time spending surge that made 2025 potentially the high-water mark for NIL compensation before the new rules were theoretically expected to bring costs under control.
That didn’t happen. Instead of decreasing, compensation increased across nearly every position in the 2026 transfer portal cycle. The average SEC starting quarterback’s price doubled from $300,000 in 2025 to $600,000 in 2026. Elite players commanded figures that would have been unthinkable a year earlier. Schools simply split spending between revenue sharing, which counts against the cap, and NIL deals through collectives, which don’t.
The College Sports Commission reported only $127 million in cleared NIL deals as of January 1, 2026. That’s a fraction of the estimated $500 million third-party NIL market for basketball alone, not counting football. Either schools aren’t reporting deals as required, the deals are structured to avoid the reporting threshold, or compliance with the new enforcement regime is functionally non-existent.
The CSC initially announced in 2025 that NIL collectives wouldn’t meet the “valid business purpose” criteria, attempting to shut down pay-for-play arrangements disguised as endorsement deals. The commission reversed course within weeks, allowing collectives to continue operating as they had been. Without meaningful enforcement, the clearinghouse system designed to bring transparency and control to NIL spending has a limited practical effect.
Notre Dame athletic director Pete Bevacqua summarized the problem plainly at a January 2026 press conference: “The numbers you’re hearing and the numbers we know that are out there don’t compute with the cap number. I think we have to be honest and forthright with ourselves and have a set of rules that are realistic and reflect what’s happening.”
The gap between stated rules and actual practice has become too obvious to ignore. Schools are spending well beyond the revenue-sharing cap through NIL channels that were supposed to be regulated but aren’t. The enforcement mechanism exists on paper but has proven toothless in practice.
What Comes Next for College Athletes and Employment
Multiple futures are possible from here, and which one materializes depends on legal decisions, regulatory actions, and political choices still being contested.
Employment Status Resolution: Johnson v. NCAA will eventually produce a definitive ruling on whether college athletes qualify as employees under federal labor law. That ruling could come in 2026 or 2027, or be appealed to the Supreme Court, extending into 2028. If courts conclude athletes are employees, questions about minimum wage, overtime, workers’ compensation, and unionization rights immediately follow.
Protect College Sports Act: That professionalization is now moving from the market to the rulebook. NIL, revenue sharing, transfer movement, conference realignment, and media-rights pressure have already changed how college sports operate. The next phase is about governance: who writes the rules, who enforces them, and how much legal protection schools and conferences receive. That is why the proposed Protect College Sports Act matters. It is not just another NIL proposal. It is one of the clearest signs yet that college sports is trying to build a federal framework for its professionalized era.
Revenue Sharing System Overhaul: The current cap isn’t working. Schools circumvent limits through NIL collectives that were supposed to be regulated but aren’t. Either the cap is abandoned for a more realistic system, enforcement actually happens with real consequences, or the gap between rules and reality continues to widen until something breaks.
Title IX Legal Challenges: Schools are making allocation decisions without clear legal guidance. Those decisions will be challenged by athletes, advocacy groups, or the Department of Education. How courts interpret Title IX’s application to revenue sharing will shape gender equity in college athletics for decades and determine whether market-based compensation or equal distribution prevails.
Formal Competitive Subdivision: The divide between Power 4 programs and everyone else continues growing. Schools with resources to maximize revenue sharing and supplement it with extensive NIL spending operate in a different economic universe than programs scraping together partial participation. That separation creates pressure for formal subdivision within Division I that acknowledges financial realities already visible in roster construction and competitive outcomes.
Professional Alternative Appeal: Minor league alternatives become more attractive to athletes who recognize they’re being paid as professionals without receiving professional-level benefits or labor protections. The NBA’s G League, overseas opportunities, and emerging alternatives offer paths to professional careers without the pretense of amateurism. As college sports become more obviously professional, the value proposition of maintaining student-athlete status while being treated as an employee in everything but name becomes harder to justify.
The Amateurism Model Died With a Paycheck
College sports didn’t gradually evolve into professionalism. They made an abrupt transition on July 1, 2025, when schools started writing eight-figure checks to athletes and implementing every structural element of professional leagues except honest terminology.
The arguments against recognizing athletes as employees aren’t about whether college sports have professionalized. They’ve professionalized. The arguments are about avoiding the legal, financial, and regulatory consequences of admitting it out loud.
Athletes perform services. Schools control how they spend their time, where they live, what obligations they fulfill, and how they represent the institution. They receive compensation directly from schools through revenue sharing and indirectly through NIL arrangements that the schools help facilitate. They operate under caps, limits, enforcement mechanisms, and free-agent systems similar to those of professional sports leagues.
The amateurism model died when Lane Kiffin flew to Knoxville to intercept a quarterback in a bidding war with Tennessee. It died when schools started spending $40 million on roster construction. It died when college quarterbacks started earning more than NFL draft picks.
The next chapter depends on whether the system adapts through negotiated collective bargaining and employee recognition, or whether courts and lawsuits force changes on an industry still pretending it hasn’t crossed the line it spent a century defending.
Either way, college sports are professional now. The only people who haven’t acknowledged it are the ones signing the checks.
Are College Athletes Employees FAQs
Are college athletes employees?
Legally, not yet. Despite receiving direct compensation through revenue sharing that began July 1, 2025, colleges maintain that athletes are not employees. The Johnson v. NCAA case is on appeal and may not be definitively resolved until 2026 or 2027. However, athletes now receive millions in direct payments from schools, work under institutional control, and operate within professional league structures—meeting most conventional definitions of employment.
How much money do college athletes make from revenue sharing?
Division I schools can distribute up to $20.5 million per year in revenue sharing for the 2025-26 academic year, with that cap rising to approximately $33 million by 2034. Individual athlete compensation varies widely by sport and position. Top quarterbacks in the 2026 transfer portal commanded $5-6 million, while the average SEC starting quarterback earns around $600,000. In total, Division I athletes will receive approximately $2.3 billion in combined revenue sharing and NIL compensation in 2025-26.
Can college athletes unionize?
The path to unionization faces significant obstacles. The National Labor Relations Act covers only private employers, excluding most Division I programs at public universities. Unionization efforts at Dartmouth and USC were withdrawn in January 2025 when the political landscape shifted. Different state laws, fragmented employer structures, and the mix of public and private institutions make it extremely difficult to create a unified bargaining unit. As of early 2026, no college athlete union has been successfully established.
How does Title IX apply to college sports revenue sharing?
This remains legally unclear. The House settlement doesn’t specify how schools should allocate the $20.5 million revenue-sharing cap between men’s and women’s sports. Some schools allocate most of the money to football and men’s basketball based on revenue, while others split it more evenly to minimize legal risk. The Biden administration issued guidance in 2025 suggesting equal opportunity requirements apply, but that guidance was rescinded. How courts will interpret Title IX’s application to revenue sharing remains unresolved.
What is the College Sports Commission?
The College Sports Commission (CSC) is the enforcement body created by the House settlement to monitor revenue-sharing compliance and regulate NIL deals. All NIL deals above $600 must flow through the CSC’s NIL Go clearinghouse for approval. However, as of January 2026, the CSC reported only $127 million in cleared deals—a fraction of the estimated $500 million NIL market. The CSC initially attempted to restrict NIL collectives but later reversed course, raising questions about the effectiveness of its enforcement.
For Further Reading on College Sports Professionalization:
Stay Ahead of the NIL & College Sports Revolution
The business of college athletics is changing faster than ever. Get the analysis that cuts through the noise—delivered straight to your inbox.
Cited by Forbes, Axios, and Front Office Sports—SportsEpreneur delivers the insights traditional sports media won’t cover.
[Subscribe to the Newsletter →]
Weekly insights on NIL, revenue sharing, transfer portal changes, and the business side of sports.
Eric Kasimov is the founder of SportsEpreneur, part of the KazSource media network. Since launching the platform in 2015, he has hosted over 500 podcast episodes, written and published more than 1,500 articles, and advised business leaders, founders, and creators on building authority through media strategy.
Through his brands — KazSource, KazCM, SportsEpreneur, and QuietLoud Studios — Eric leads teams that produce podcasts, develop brand platforms, and help companies grow through modern content ecosystems. He also scaled KazSource Insurance into a seven-figure boutique agency, providing the foundation for the broader media network he operates today.
His work has been featured in Forbes, Axios, and Front Office Sports, and his podcasts have included conversations with top founders, investors, and athletes turned entrepreneurs.
College Sports Turned Pro: And Nobody Will Admit It
Key Points: Are College Athletes Employees?
Lane Kiffin flew to Knoxville in January 2026 to intercept a quarterback who had just committed to LSU. Not to coach him. To outbid Tennessee in a live auction for his services. The price tag landed around $6 million for Sam Leavitt, a redshirt sophomore who’d thrown 36 career touchdown passes.
Welcome to college football in 2026, where the charade finally ended, but nobody wants to admit it out loud.
On July 1, 2025, college sports crossed a threshold it had been approaching for years. Schools started writing checks directly to athletes through revenue-sharing agreements that look, sound, and function exactly like professional sports payroll systems. The House v. NCAA settlement authorized Division I programs to distribute up to 22% of Power 5 average athletic revenues—equaling $20.5 million in the first year—with that number climbing to roughly $33 million by 2034.
This isn’t some incremental change in the name, image, and likeness landscape. This is the complete professionalization of college athletics, packaged with salary caps, roster limits, centralized enforcement, and multi-million dollar player contracts. The only thing missing is honest language about what everyone knows is true: college sports have become a professional enterprise, and the people running them are doing everything possible to avoid saying so.
The Money Tells the Story About “Student-Athletes”
Follow the dollars and the truth becomes unavoidable. In the 2025-26 academic year, Division I athletes will receive approximately $2.3 billion in combined revenue sharing and NIL compensation. Schools that opted into the House settlement—82% of Division I programs—committed to distributing portions of their media rights, ticket sales, and sponsorship revenues directly to the athletes generating them.
Power 4 schools immediately maxed out their revenue-sharing allocations. LSU didn’t stop there. After securing their $6 million quarterback in January 2026, the Tigers continued to assemble their most expensive roster in Tiger history through the transfer portal. Texas Tech’s roster reportedly cost more than $28 million in 2025. These aren’t outlier programs gaming the system. This is the new baseline for schools serious about competing.
The quarterback market alone demonstrates how far removed college sports are from anything resembling amateurism. Top signal-callers command between $3 million and $6 million for a single season in the 2026 transfer portal cycle. Brendan Sorsby signed with Texas Tech for $5 million. When quarterbacks who haven’t taken an NFL snap earn more than mid-round NFL draft picks, the amateur label becomes absurd on its face.
Consider what that means in practical terms. Jaxson Dart, selected 25th in the 2025 NFL Draft, signed a four-year deal paying roughly $4.2 million per season. Sam Leavitt and Brendan Sorsby will make more than Dart in 2026 while playing college football. The New Orleans Saints’ starting quarterback, Tyler Shough, earns around $2.7 million per year. College athletes at premier programs are now making more than professional athletes at the next level.
2026 Transfer Portal Market Rates by Position:
Team Transfer Portal Budgets for 2026 (Per SportsCasting):
These figures are in addition to the $20.5 million revenue-sharing cap, which was intended to bring spending under control. It didn’t.
Professional League Infrastructure Without the Honesty
The House settlement didn’t just open the checkbook. It created the structural framework of a professional sports league while maintaining the fiction that participants aren’t employees.
The New Professional Systems:
Salary Caps: Schools can distribute up to 22% of Power 5 average athletic revenues each year, capped at $20.5 million for the 2025-26 academic year. That cap increases roughly 4% annually over the settlement’s ten-year term. This is identical in function to the salary cap systems in the NFL, NBA, and NHL, which are designed to promote competitive balance by preventing the richest programs from spending without limits.
Roster Limits: Instead of restricting how many athletes receive scholarships, the settlement imposed hard caps on the number of athletes who can be on each team’s roster by sport. These limits mirror the roster-construction rules in professional leagues, where teams balance depth with the cost of maintaining large rosters.
Centralized Enforcement: The College Sports Commission emerged as the first centralized enforcement body in college athletics. The CSC monitors revenue-sharing compliance, reviews NIL deals exceeding $600 to ensure they serve “valid business purposes,” and has the authority to levy penalties on programs that violate the new rules. This is the functional equivalent of the commissioners’ offices in professional sports, existing to maintain competitive integrity and enforce agreed-upon rules. There are rumors that this monitoring is going about as well as you might think.
NIL Deal Regulation: All NIL deals exceeding $600 must be submitted to the NIL Go clearinghouse for approval. The CSC evaluates whether compensation reflects fair market value and whether the deal serves a legitimate business purpose, seeking to distinguish genuine endorsements from pay-for-play arrangements masked as NIL contracts.
Free Agency System: The transfer portal functions as free agency. Athletes can enter during a designated window, negotiate with programs offering the best combination of playing time and compensation, and move between schools with minimal restriction. The 2026 cycle eliminated the spring transfer window entirely, consolidating all movement into a single 15-day January period that operates with the urgency and intensity of NFL free agency. Except in the NFL, players usually sign multi-year contracts. In college football, roster management is handled year to year.
Every structural element of professional sports now exists in college athletics. The only missing piece is the straightforward acknowledgment that the people being paid millions of dollars to perform athletic services are employees.
The College Athlete Employment Question Everyone’s Avoiding
Call someone an employee and the legal landscape shifts entirely. Employees get minimum wage. Overtime pay. Workers’ compensation. The right to unionize and bargain collectively. Employee status triggers Title IX obligations, potentially requiring equal compensation across men’s and women’s sports. It opens athletic departments to labor law, employment discrimination statutes, and regulatory frameworks designed for employer-employee relationships.
So, despite paying athletes like employees, controlling their time like employees, and building professional league infrastructure around them, schools fight desperately to avoid the label.
Johnson v. NCAA established a four-prong test for determining whether college athletes qualify as employees under the Fair Labor Standards Act. The Third Circuit ruled in mid-2024 that athletes could meet the test if they:
Before the House settlement, athletes struggled to satisfy the compensation prong. Revenue sharing changed the calculation. Schools now pay athletes directly from revenues generated by their athletic performance. Athletes receive checks from their universities for playing sports. That’s employment by any conventional definition, yet the case remains unresolved and will likely extend through 2027 at a minimum before reaching a definitive conclusion.
Universities are paying athletes millions of dollars, controlling their schedules, dictating their obligations, and structuring entire departments around managing their services. The only thing preventing them from being employees is semantic resistance from the institutions writing the checks.
The Unionization Efforts That Hit a Wall
Athletes organizing for collective bargaining rights represent the logical endpoint of professionalization. If college sports function like professional leagues, athletes should have the same rights as players in the NFL, NBA, NHL, and MLB to collectively negotiate wages, working conditions, and the rules governing their employment.
The Dartmouth men’s basketball team voted to unionize in early 2024, and a regional director of the National Labor Relations Board ruled they qualified as employees under the National Labor Relations Act. The decision marked a significant victory for athlete advocates who’d spent years arguing that college athletes deserved the same labor protections as other workers.
That momentum evaporated in January 2025. The Dartmouth case was withdrawn. So was the USC complaint filed by the National College Players Association on behalf of Trojan athletes. Both cases closed within days of each other as the Trump administration prepared to take control of the NLRB, which handles employment disputes at private institutions.
Structural Obstacles to College Athlete Unionization:
Athletes.org, an organization representing roughly 5,000 college athletes as of early 2026, released a blueprint for what collective bargaining in college sports might look like. But releasing a proposal isn’t the same as achieving recognition, and without a clear path through either the NLRB or state labor boards, the unionization push stalled.
Some athletic directors have begun suggesting that collective bargaining might be the only way to create enforceable rules with legal protection from antitrust challenges. Professional leagues operate under the non-statutory labor exemption, which shields their collective bargaining agreements from antitrust scrutiny. The NCAA has no such protection, leaving nearly every rule vulnerable to legal challenge. But acknowledging that collective bargaining would solve problems requires recognizing that athletes are employees, and no one with decision-making authority wants to make that leap.
The Title IX Time Bomb
Revenue sharing created a problem that schools are still figuring out how to handle. Title IX requires educational institutions receiving federal funding to provide equal opportunities to male and female students, including in athletics. How does a school distribute $20.5 million while complying with equal opportunity requirements?
The settlement is silent on allocation methodology. It caps total amounts but provides no guidance on how to divide money between sports or genders. Athletic directors make decisions that could expose their institutions to legal liability under either Title IX or employment discrimination statutes.
Some schools have already allocated the majority of revenue sharing to men’s sports, particularly football and men’s basketball, using professional sports logic—compensation tracks revenue generation. But Title IX focuses on equal opportunity, not market-based compensation. If revenue sharing falls under Title IX’s athletics provisions, gender-based differences in allocation could constitute discrimination regardless of which sports generate revenue.
Employee status might change the calculus. If athletes are employees, Title IX’s employment provisions could apply rather than its athletics provisions. Employment law generally permits different compensation based on revenue generation and market value. But athletes aren’t officially employees yet, so which framework applies remains unclear. Schools are gambling on how courts will eventually interpret Title IX’s application to revenue sharing.
The Biden administration’s Department of Education issued guidance in 2025 stating that revenue-sharing arrangements should comply with Title IX’s equal opportunity requirements. That guidance was rescinded. Without clear regulatory direction, schools are making multi-million dollar allocation decisions in legal gray zones that will inevitably be challenged and litigated.
Where Different Stakeholders Land
The transformation to professional athletics doesn’t affect everyone equally. Winners and losers are already emerging as the new system takes shape.
Power 4 Schools: Maximize revenue sharing immediately and maintain significant competitive advantages. Their media rights deals, stadium revenues, and donor bases support both the $20.5 million revenue share and substantial additional NIL spending through collectives. Programs like Texas, Ohio State, and LSU operate with combined budgets exceeding $40 million for roster construction when revenue sharing and NIL are combined.
Non-Power Schools: Face impossible math. The revenue sharing cap is the same $20.5 million for all Division I institutions, but most programs outside the Power 4 don’t generate enough revenue to afford full participation. A school pulling $30 million in total athletic revenue can’t allocate $20.5 million to athlete compensation without gutting the rest of the department. Many programs opted into revenue sharing but can’t afford to fully capitalize on it, creating a permanent competitive disadvantage.
Olympic Sports: Exist in perpetual uncertainty. The revenue-sharing model doesn’t specify allocations by sport, but the money flows primarily from football and basketball media rights. Athletic directors deciding how to allocate limited resources face pressure to focus spending on revenue-generating sports, at the expense of Olympic programs that may not generate enough revenue to justify their costs in a professionalized system.
Women’s Sports: Occupy an ambiguous position. Title IX provides some protection against the loss of resources, but whether that protection extends to revenue-sharing allocations remains unclear. Women’s basketball has grown in popularity and commercial appeal, potentially positioning it to capture a larger share of revenue. But most women’s sports don’t generate revenue comparable to that of football and men’s basketball, leaving them vulnerable if compensation is tied strictly to revenue.
Athletes: Receive more money but no employee protections. They’re getting paid like professionals without minimum wage guarantees, overtime protections, workers’ compensation, or the right to collectively bargain over working conditions. They can be cut from rosters, have scholarships revoked, or be subject to rules they have no voice in creating. The money is real, but the labor protections that typically accompany professional employment don’t exist.
Smaller Division I Programs: Face existential questions. Schools in conferences without lucrative media deals, playing in modest facilities, serving regional fan bases—they opted into revenue sharing to remain competitive but lack the resources to keep pace with Power 4 spending. The gap between the richest and poorest Division I programs was already significant. Revenue sharing and unrestricted NIL spending are accelerating that separation into a chasm.
Circumventing the Cap Before the Ink Dried
The $20.5 million revenue-sharing cap was supposed to create spending limits and promote competitive balance. Schools found workarounds immediately.
NIL collectives rushed to frontload deals for the 2025-26 academic year before July 1, 2025, when the College Sports Commission’s enforcement began. By distributing funds before the deadline, collectives avoided payments that would have counted against the revenue-sharing cap or flowed through the NIL Go approval system. This created a one-time spending surge that made 2025 potentially the high-water mark for NIL compensation before the new rules were theoretically expected to bring costs under control.
That didn’t happen. Instead of decreasing, compensation increased across nearly every position in the 2026 transfer portal cycle. The average SEC starting quarterback’s price doubled from $300,000 in 2025 to $600,000 in 2026. Elite players commanded figures that would have been unthinkable a year earlier. Schools simply split spending between revenue sharing, which counts against the cap, and NIL deals through collectives, which don’t.
The College Sports Commission reported only $127 million in cleared NIL deals as of January 1, 2026. That’s a fraction of the estimated $500 million third-party NIL market for basketball alone, not counting football. Either schools aren’t reporting deals as required, the deals are structured to avoid the reporting threshold, or compliance with the new enforcement regime is functionally non-existent.
The CSC initially announced in 2025 that NIL collectives wouldn’t meet the “valid business purpose” criteria, attempting to shut down pay-for-play arrangements disguised as endorsement deals. The commission reversed course within weeks, allowing collectives to continue operating as they had been. Without meaningful enforcement, the clearinghouse system designed to bring transparency and control to NIL spending has a limited practical effect.
Notre Dame athletic director Pete Bevacqua summarized the problem plainly at a January 2026 press conference: “The numbers you’re hearing and the numbers we know that are out there don’t compute with the cap number. I think we have to be honest and forthright with ourselves and have a set of rules that are realistic and reflect what’s happening.”
The gap between stated rules and actual practice has become too obvious to ignore. Schools are spending well beyond the revenue-sharing cap through NIL channels that were supposed to be regulated but aren’t. The enforcement mechanism exists on paper but has proven toothless in practice.
What Comes Next for College Athletes and Employment
Multiple futures are possible from here, and which one materializes depends on legal decisions, regulatory actions, and political choices still being contested.
Employment Status Resolution: Johnson v. NCAA will eventually produce a definitive ruling on whether college athletes qualify as employees under federal labor law. That ruling could come in 2026 or 2027, or be appealed to the Supreme Court, extending into 2028. If courts conclude athletes are employees, questions about minimum wage, overtime, workers’ compensation, and unionization rights immediately follow.
Protect College Sports Act: That professionalization is now moving from the market to the rulebook. NIL, revenue sharing, transfer movement, conference realignment, and media-rights pressure have already changed how college sports operate. The next phase is about governance: who writes the rules, who enforces them, and how much legal protection schools and conferences receive. That is why the proposed Protect College Sports Act matters. It is not just another NIL proposal. It is one of the clearest signs yet that college sports is trying to build a federal framework for its professionalized era.
Revenue Sharing System Overhaul: The current cap isn’t working. Schools circumvent limits through NIL collectives that were supposed to be regulated but aren’t. Either the cap is abandoned for a more realistic system, enforcement actually happens with real consequences, or the gap between rules and reality continues to widen until something breaks.
Title IX Legal Challenges: Schools are making allocation decisions without clear legal guidance. Those decisions will be challenged by athletes, advocacy groups, or the Department of Education. How courts interpret Title IX’s application to revenue sharing will shape gender equity in college athletics for decades and determine whether market-based compensation or equal distribution prevails.
Formal Competitive Subdivision: The divide between Power 4 programs and everyone else continues growing. Schools with resources to maximize revenue sharing and supplement it with extensive NIL spending operate in a different economic universe than programs scraping together partial participation. That separation creates pressure for formal subdivision within Division I that acknowledges financial realities already visible in roster construction and competitive outcomes.
Professional Alternative Appeal: Minor league alternatives become more attractive to athletes who recognize they’re being paid as professionals without receiving professional-level benefits or labor protections. The NBA’s G League, overseas opportunities, and emerging alternatives offer paths to professional careers without the pretense of amateurism. As college sports become more obviously professional, the value proposition of maintaining student-athlete status while being treated as an employee in everything but name becomes harder to justify.
The Amateurism Model Died With a Paycheck
College sports didn’t gradually evolve into professionalism. They made an abrupt transition on July 1, 2025, when schools started writing eight-figure checks to athletes and implementing every structural element of professional leagues except honest terminology.
The arguments against recognizing athletes as employees aren’t about whether college sports have professionalized. They’ve professionalized. The arguments are about avoiding the legal, financial, and regulatory consequences of admitting it out loud.
Athletes perform services. Schools control how they spend their time, where they live, what obligations they fulfill, and how they represent the institution. They receive compensation directly from schools through revenue sharing and indirectly through NIL arrangements that the schools help facilitate. They operate under caps, limits, enforcement mechanisms, and free-agent systems similar to those of professional sports leagues.
The amateurism model died when Lane Kiffin flew to Knoxville to intercept a quarterback in a bidding war with Tennessee. It died when schools started spending $40 million on roster construction. It died when college quarterbacks started earning more than NFL draft picks.
The next chapter depends on whether the system adapts through negotiated collective bargaining and employee recognition, or whether courts and lawsuits force changes on an industry still pretending it hasn’t crossed the line it spent a century defending.
Either way, college sports are professional now. The only people who haven’t acknowledged it are the ones signing the checks.
Are College Athletes Employees FAQs
Are college athletes employees?
Legally, not yet. Despite receiving direct compensation through revenue sharing that began July 1, 2025, colleges maintain that athletes are not employees. The Johnson v. NCAA case is on appeal and may not be definitively resolved until 2026 or 2027. However, athletes now receive millions in direct payments from schools, work under institutional control, and operate within professional league structures—meeting most conventional definitions of employment.
How much money do college athletes make from revenue sharing?
Division I schools can distribute up to $20.5 million per year in revenue sharing for the 2025-26 academic year, with that cap rising to approximately $33 million by 2034. Individual athlete compensation varies widely by sport and position. Top quarterbacks in the 2026 transfer portal commanded $5-6 million, while the average SEC starting quarterback earns around $600,000. In total, Division I athletes will receive approximately $2.3 billion in combined revenue sharing and NIL compensation in 2025-26.
Can college athletes unionize?
The path to unionization faces significant obstacles. The National Labor Relations Act covers only private employers, excluding most Division I programs at public universities. Unionization efforts at Dartmouth and USC were withdrawn in January 2025 when the political landscape shifted. Different state laws, fragmented employer structures, and the mix of public and private institutions make it extremely difficult to create a unified bargaining unit. As of early 2026, no college athlete union has been successfully established.
How does Title IX apply to college sports revenue sharing?
This remains legally unclear. The House settlement doesn’t specify how schools should allocate the $20.5 million revenue-sharing cap between men’s and women’s sports. Some schools allocate most of the money to football and men’s basketball based on revenue, while others split it more evenly to minimize legal risk. The Biden administration issued guidance in 2025 suggesting equal opportunity requirements apply, but that guidance was rescinded. How courts will interpret Title IX’s application to revenue sharing remains unresolved.
What is the College Sports Commission?
The College Sports Commission (CSC) is the enforcement body created by the House settlement to monitor revenue-sharing compliance and regulate NIL deals. All NIL deals above $600 must flow through the CSC’s NIL Go clearinghouse for approval. However, as of January 2026, the CSC reported only $127 million in cleared deals—a fraction of the estimated $500 million NIL market. The CSC initially attempted to restrict NIL collectives but later reversed course, raising questions about the effectiveness of its enforcement.
For Further Reading on College Sports Professionalization:
Stay Ahead of the NIL & College Sports Revolution
The business of college athletics is changing faster than ever. Get the analysis that cuts through the noise—delivered straight to your inbox.
Cited by Forbes, Axios, and Front Office Sports—SportsEpreneur delivers the insights traditional sports media won’t cover.
[Subscribe to the Newsletter →]
Weekly insights on NIL, revenue sharing, transfer portal changes, and the business side of sports.
Eric Kasimov is the founder of SportsEpreneur, part of the KazSource media network. Since launching the platform in 2015, he has hosted over 500 podcast episodes, written and published more than 1,500 articles, and advised business leaders, founders, and creators on building authority through media strategy.
Through his brands — KazSource, KazCM, SportsEpreneur, and QuietLoud Studios — Eric leads teams that produce podcasts, develop brand platforms, and help companies grow through modern content ecosystems. He also scaled KazSource Insurance into a seven-figure boutique agency, providing the foundation for the broader media network he operates today.
His work has been featured in Forbes, Axios, and Front Office Sports, and his podcasts have included conversations with top founders, investors, and athletes turned entrepreneurs.