California Legislature Approves Bill to Expedite Compensation Protections for Student Athletes

Senate Bill 26, authored by Senator Steven Bradford (D-Gardena) and Senator Nancy Skinner (D-Berkeley), and co-authored by Senator Scott Wilk (R-Santa Clarita) Aug. 25, passed the California Senate after clearing the Assembly on Aug. 19.  

SB 26, known as the Fair Pay to Play Act 2.0, advances the effective date of the Fair Pay to Play Act in SB 206 (2019) from Jan. 1, 2023 to Sept.1, 2021. 

SB 206 was the first law in the nation to give student athletes the right to compensation for their name, image, and likeness, allowing them to earn money from sponsorships, endorsements and other activities. SB 26 extends the protection of student athletes to include compensation for their reputation in addition to their name, image, and likeness.  The Bill further expands entities covered under the Fair Pay to Play Act to include the California Community Colleges.

Since the passage of SB 206, over 30 other states have initiated plans to introduced similar laws to SB 206. About 17 states have enacted similar laws, and eight states have them going into effect on July 1, 2021 (including Alabama, Florida, Georgia, Kentucky, Mississippi, and New Mexico, Ohio, and Texas). 

The National College Athletic Association’s (NCAA)’s Division 1 Council voted in late June to allow student athletes to earn money for autograph signings, personal appearances, endorsements, and social media platforms. In the 2017 fiscal year, the National Collegiate Athletic Association (NCAA), which operates as a nonprofit organization, reported $1.1 billion in revenue.

Earlier in June, the Supreme Court ruled in National Association of Intercollegiate Athletic Association v. Alston, that the NCAA does not have blanket authority to deny the rights of college athletes when it comes to just compensation, and doing so would violate antitrust laws. In October 2020, the National Association of Intercollegiate Athletics voted to let players earn money for public appearances and endorsements.  Schools have already started to partner with companies to help athletes navigate the landscape of NIL. 

SB 206 authored by Senator Skinner and Senator Bradford, allows athletes to earn money using their name, image and likeness or NIL without the compensation affecting their scholarship eligibility or ability to play sports.  It also prohibits athletic associations, conferences, and others with authority over college sports including the National College Athletic Association (NCAA) from preventing students from using their NIL. Before the law, the stance from the NCAA was that student athletes should only be allowed to receive scholarships and stipends for living costs, and that they should not financially benefit from their talents or fame.  

SB 26 will next be sent to Governor Gavin Newsom for his signature.