Flexibility regarding NIL

The NCAA notoriously does not lack for rules. For example, one rule defines “business day” while another dictates when coaches may and may not answer their phones. When I served as an athletics department compliance staff member at a Big 12-member university, my responsibilities included educating constituents and answering questions about applying NCAA rules.

Until July 2021, and based on its notion that student-athletes should be amateurs, the NCAA generally prohibited them from making money off their names, images and likenesses (NIL). For example, an NCAA rule permitted a student-athlete to provide private lessons in their sport for pay — but the student-athlete could not use their name or picture to promote the lessons. So the most the student-athlete could do was advertise: “For tennis lessons from a Division I athlete, call this number.” Presumably, no parent would have been too enthusiastic about calling the number to arrange lessons for their child. But that was all student-athletes could do.

Another illustration of the application of pre-July 2021 NCAA rules occurred when a couple of my compliance staff colleagues grabbed lunch at a local burger place. When they walked in, they noticed that the restaurant had affixed a picture of one of their hamburgers over the ball that a high-profile student-athlete held in one of our sports team’s posters. Under NCAA rules at the time, this was an improper use of the student-athlete’s image and likeness to promote the restaurant. Thus, even though it was innocent and creative, we had to ask the restaurant to remove the burger photo from the poster. Even though the student-athlete did not know about the alteration to the poster, NCAA rules dictated that this was a necessary step to protect the student-athlete’s ability to compete.

Many things changed in July 2021 when the NCAA adopted an interim policy suspending its NIL rules, mainly because of external pressures. With limited exceptions, student-athletes may now monetize their NIL. As a result, student-athletes have already earned remuneration for promoting everything from gyms to barbecue restaurants to beverages to merchandise. They’ve also received compensation for appearances and autographs. Just a few weeks ago, participation in these activities likely would have jeopardized a student-athlete’s eligibility to compete in college athletics. Student-athletes can now use their names and images for advertising private lessons and receive pay — or free burgers — when promoting restaurants.

Despite changes to NIL rules, NCAA legislation regarding athletics aid provided by universities and prohibitions on “pay-for-play” remain in place.  In other words, an entity or university may not pay a student-athlete based on the number of points she scores in a basketball game or an entire team for beating the archrival football program.

Many questions remain about what student-athlete NIL compensation will look like in the future. NCAA member universities will work toward a permanent NIL policy. Numerous states have enacted laws, and most universities have proscribed policies governing student-athlete compensation. For example, many universities limit student-athlete involvement with gambling entities. However, some of these laws and policies are more lenient than others. Many believe this could lead to recruiting advantages for universities located in less restrictive states or with more open policies. There has been discussion regarding possible federal legislation that would help create uniformity. However, the NCAA’s deregulation likely lessened the federal government’s motivation to get involved. Some states still limit high school athletes from NIL activities, which has already led one prominent prospective student-athlete to reclassify his graduation year and declare his intent to enroll at a university early to take advantage of the ability to monetize his NIL.

Given these questions, it is likely that we will continue to see changes in rapidly evolving college athletics.

Josh Lens, J.D., is an assistant professor of recreation and sport management at the University of Arkansas and also consults for universities and conferences regarding legal and NCAA matters. The opinions expressed are those of the author.