The U.S. Department of Education issued new guidance stating that plans by colleges to pay athletes directly through name, image, and likeness (NIL) deals could violate Title IX if the distribution is not proportional between male and female athletes. 

Title IX mandates gender equity in schools that receive Federal financial assistance, including K-12 schools, colleges, and universities. The prohibition on sex discrimination extends to all educational programs in schools, including athletic programs, and requires that athletic financial aid and opportunities reflect the gender makeup of the student body. 

The Office for Civil Rights (OCR) memo clarifies that NIL-related compensation should be treated as athletic financial assistance, like scholarships, and must be distributed proportionally between male and female student-athletes. Universities in powerhouse conferences, however, recently stated plans to allocate most NIL funds to athletes competing in high-revenue sports like football and men’s basketball, raising concerns about Title IX compliance.

The memo also addresses schools' Title IX obligations to provide equal support services and equal opportunities for publicity in media coverage and social media presence. Although third-party collective payments are often not considered financial assistance and the OCR does not classify NIL agreements with third parties as financial aid, it cautioned that such payments could still trigger Title IX obligations if they create gender disparities within athletic programs.

Title IX enforcement typically comes down through lawsuits brought by athletes. One such lawsuit, involving female athletes suing the University of Oregon, claims the school violated Title IX in its NIL distribution plans. The plaintiffs' attorney stated that the new memo bolsters their case. The guidance also raises questions regarding the proposed settlement in House v. NCAA, a class action filed in the U.S. District Court for the Northern District of California in 2020 that would pave the way for colleges to pay student-athletes directly through revenue sharing, as it could further exacerbate gender disparities.

The NCAA has not provided specific guidance to schools on Title IX compliance and athletic directors have already acknowledged the need to reassess their distributions in light of the new memo. Universities may reconsider their plans to allocate NIL compensation based on revenue generation and adjust their strategies based on the Department of Education's guidance, highlighting the rapidly evolving landscape of college sports. 

With a new administration and the continued enforceability and viability of Department of Education and OCR mandates in jeopardy, it is unclear whether OCR’ s new guidance will have lasting impact. Much like the political and cyclical nature of Title IX, the rules and regulations governing NIL in athletics remain in flux with litigation and changing political tides likely to alter the playing field in coming months and years.  

https://www.ed.gov/media/document/ocr-factsheet-benefits-student-athletes