College Athlete Bill Grants Labor Rights: Scholarship Holders Classified as Employees for Collective Bargaining

The College Athlete Right to Organize Act is a massive shift in how college sports operate, setting the stage for collective bargaining in a multi-billion dollar industry. Simply put, this legislation amends federal labor law—the National Labor Relations Act (NLRA)—to classify college athletes who receive financial aid or scholarships tied to playing a sport as employees of their schools. This means if you’re getting a grant-in-aid or scholarship that requires you to show up for practice and games, you now have the right to form a union and negotiate over pay, working conditions, and safety, just like any other worker.

The End of the Amateur Status Myth

For decades, the NCAA and universities have held that athletes are ‘amateurs,’ denying them basic labor rights while profiting immensely from their performance. This bill (Sec. 2) argues that college athletes are employees under common law because they perform valuable services, schools control their work, and they receive compensation (stipends, aid) for it. By classifying these athletes as employees (Sec. 3), the bill gives them the power to address the massive imbalance identified in the findings—the ability to collectively bargain with their schools and athletic conferences over things like health insurance, practice hours, and revenue sharing.

Who’s the Boss Now? The NLRB

This law explicitly brings both public and private colleges under the NLRA as ‘employers’ in relation to their athletes (Sec. 3). This is a big deal because it means the National Labor Relations Board (NLRB) takes over jurisdiction for all disputes. If athletes want to unionize, the NLRB handles the election. If a school tries to stop them or retaliate, the NLRB steps in. Crucially, the bill allows the NLRB to recognize a group of schools within an athletic conference as a single, multiemployer bargaining unit if the athletes’ representatives agree—meaning athletes could negotiate league-wide standards, similar to professional sports unions.

Protecting the Scholarship and the Tax Bill

One of the biggest concerns for athletes and their families when discussing employee status is the potential loss of financial aid or new tax burdens. This bill proactively addresses that. It states clearly that classifying an athlete as an employee for collective bargaining purposes will not change the tax status of their compensation or scholarships. If a scholarship wasn’t taxable income before this law, it won’t suddenly become taxable now (Sec. 4). Furthermore, any compensation received won't count against an athlete’s eligibility for federal financial aid programs, such as Pell Grants.

Real-World Impact: What Changes on Campus?

For the athlete, this means power at the negotiating table. Imagine a college football player whose team is practicing 50 hours a week. Instead of just complaining to a coach, they could negotiate with the school via their union for limits on practice time or better medical coverage. For the university, this means a massive administrative overhaul. They now have to deal with labor relations, potentially negotiating contracts with groups of athletes across multiple sports. While the bill explicitly excludes the NCAA itself from the definition of an athletic conference, the NCAA’s ability to set eligibility rules could become a major point of contention during bargaining, especially if those rules conflict with a negotiated labor agreement.

This legislation is a game-changer, moving college sports from a loosely regulated amateur model to a federally regulated labor market, ensuring that the people generating billions of dollars finally have a seat at the table.