Gustafson Gluek helps unpaid NCAA coaches get $303M

The NCAA has agreed to pay $303 million to settle class-action wage-fixing claims filed on behalf of volunteer college coaches. If approved, the agreement will compensate more than 7,700 college coaches. Minneapolis-based law firm Gustafson Gluek PLLC was co-counsel in filing suit against the NCAA.

From 1992 to 2023, the NCAA and its Division I schools agreed to cap the number of paid sports coaches. Some teams had a “volunteer coach” who was unpaid and not eligible for other benefits. Schools that violated that rule were punished. Coaches would voluntarily work for no pay in hopes of furthering their careers.

Ultimately, coaches filed a class action, claiming that the NCAA and member schools “engaged in an illegal wage-fixing conspiracy to exercise the NCAA’s admitted monopoly market power in the labor market for coaches.” Plaintiffs claimed that the NCAA and its member schools colluded to suppress wages for “volunteer coaches” by capping their compensation at $0, despite these coaches performing many of the same duties as paid staff, often full-time. They alleged that doing so violated Section 1 of the Sherman Act. Plaintiffs stated that, absent this wage-fixing scheme, these skilled coaches would have been paid market rates or at least be compensated in compliance with wage and hour laws.

A class action antitrust lawsuit represented more than 7,700 volunteer college coaches. The class period covers coaches who worked in Division I athletic programs other than baseball between March 17, 2019, and June 20, 2023. It excludes baseball because the NCAA already settled a similar claim for baseball volunteer coaches. That claim was settled for nearly $50 million, with $33 million going to roughly 1,000 coaches.

The $303 million figure, according to plaintiffs’ counsel, was arrived at after arms-length negotiation and ultimately after bringing in a mediator. Expert economist Dr. Orley Ashenfelter, retained by the plaintiffs, estimated lost wages. The amount apparently is 119% of the actual damages from lost wages according to Ashenfelter’s estimate.

As a result of the settlement, on average, each coach would receive just under $40,000 before expenses and fees. This would be based on the school, sport, and how long the coach worked.

“We are incredibly proud of this settlement which, if approved, will provide significant and meaningful compensation to thousands of hard-working coaches,” said co-lead counsel Dennis Stewart of Gustafson Gluek’s San Diego office, Michael Lieberman of Fairmark Partners in Washington, D.C., and Bob Gralewski of Kirby McInerney in San Diego. “We look forward to the approval process and are committed to ensuring that these funds are distributed to coaches in a fair and efficient manner.”

According to a memo sent by NCAA President Charlie Baker, the settlement will be funded by Division I membership and the national office. He noted that payments would likely not start until after next summer.

“While this settlement represents a substantial financial commitment, it closes the door on claims related to volunteer coach bylaws,” Baker said in the memo.

The proposed settlement awaits approval from U.S. District Court Judge for the Eastern District of California, William Shubb. Anyone who believes that they are a class member and did not receive notice can email [email protected].

The Volunteer Coach Rule was repealed in 2023.