NIL is Now Permitted for Pennsylvania High School Athletes
Name, image, and likeness (NIL) is now permitted for high school athletes in Pennsylvania.
The Pennsylvania Interscholastic Athletic Association (PIAA) Board of Directors on Wednesday, December 7, 2022, approved on its third and final reading a new policy to allow high school athletes to profit off their NIL while maintaining their high school athletics eligibility. The NIL policy was originally passed on the first reading with the PIAA Board of Directors in July and then passed a second reading in October. The NIL policy is effective immediately.
Under the PIAA's new NIL policy, Pennsylvania high school athletes are eligible to profit from their NIL from a number of options, including commercial endorsements, promotional activities, and a social media presence.
The NIL policy, however, has some restrictions that mirror NIL policies adopted by other high school state athletic associations. The policy prohibits any person employed or affiliated with the school, including boosters and alumni, from soliciting, arranging, negotiating, or paying for the use of a student’s NIL.
In addition, students cannot wear school uniforms or “school-identifying apparel” or make reference to the PIAA or their school or team name when engaging in NIL activities. Students also cannot endorse or promote any third-party entities, goods, or services during team or school activities. The students also cannot wear apparel or display a logo or insignia of an NIL partner during team activities, unless that logo or insignia is part of the team uniform.
Furthermore, the policy outlined prohibitions on NIL activities in certain vice industries, including:
Casinos and gambling;
Tobacco and electronic smoking;
Controlled dangerous substances; and
Weapons, firearms, and ammunition.
The policy introduced a requirement that each NIL deal be based on the value a given athlete’s endorsement brings for providing a specific service/activity. Specifically, the policy states that “NIL contracts/agreements need to come from analysis of the value an athlete brings for providing a specific service/activity, not as an incentive for enrollment decisions or membership on a team.” The guidance, however, does not provide any objective criteria for determining the “value” an athlete’s endorsement would bring for providing a specific service/activity. Therefore, businesses entering into NIL deals with PIAA athletes will need to justify the “value” a given athlete brings to the deal using objective factors or metrics (e.g., potential engagement rate).
The policy also includes a disclosure requirement that requires an athlete to disclose to their principal or athletic director any NIL agreement within 72 hours after entering into the agreement.
With the PIAA’s new NIL policy, there are now 22 high school state athletic associations that allow student-athletes to monetize their NIL while maintaining their high school athletics eligibility.
Ryan Whelpley is an Associate at Morse in Waltham, Massachusetts, where he is a member of the firm’s Corporate Practice Group. He is a graduate of Albany Law School and Union College. At Union, Ryan was a member and three-year captain of the Men’s Basketball Team. You can connect with him via Twitter (@Whelpley_Law) and LinkedIn.