The Uniform Law Commission (ULC) has approved significant changes to the Uniform Athlete Agents Act (UAA) at its recent annual meeting.

The UAA, first adopted in 2000, has been enacted in 40 states, as well as the District of Columbia and the U.S. Virgin Islands. Laws similar to the UAA have been enacted by several states including California, Michigan, and Ohio.

The revisions address allegations of improper conduct by agents in their pursuit and representation of college athletes. As states began considering non-uniform amendments to the UAA to address these issues, the ULC decided to revise the UAA.

Most notably, the UAA will have a broader definition of who qualifies as an agent. The 2000 UAA regulates sports agents but generally exempted financial advisers and other potential service providers to student athletes. The UAA now will regulate financial advisers who offer gifts or money to student-athletes in the hope of securing their business when they turn professional. In addition to traditional sports agents, the UAA will cover any individual who provides consideration to a student-athlete in anticipation of serving the athlete in an advisory capacity on matters related to finances, business pursuits, or career management decisions; or managing business affairs for the athlete by providing assistance with bills, payments, contracts, or taxes. Accordingly, service providers that come under the definition of “agent” will now be subjected to the criminal and civil penalties under the applicable state’s version of the UAA.

The revised UAA also recommends maximum civil penalties for violations be increased from $25,000 to $50,000, although UAA generally leaves it to each state to determine whether a violation is a felony or a misdemeanor. The ULC had considered revising the applicable penalties, but decided against that because most states follow the penalties outlined in the 2000 UAA.

The revised UAA also imposes additional notification requirements for agents, requiring them to inform schools before contacting student-athletes and those close to student-athletes. Agents must notify institutions of a pre-existing relationship with a student-athlete who is on an athletic scholarship. Moreover, the definition of “educational institution” now includes schools from elementary through college.

The revised UAA also provides for enhanced reciprocity in agent registration and includes an alternate provision that contemplates a multistate agency that would manage the registration process. The multistate registration agency could take effect if at least five states join.

The revisions also strengthen the UAA’s ability to bar sports agents from illegally luring college athletes into contracts. For example, the UAA requires that agency contracts be accompanied by a separate record signed by the student-athlete acknowledging that signing the contract may result in a loss of eligibility. The contract also must contain a statement that the agent is registered in the state where the contract is signed.

States may begin adopting the revised UAA in the coming year. The form of the UAA followed has significant implications on the practice of agents within each state, as well as the practice of any individual who provides, or contemplates providing, any services to a student-athlete. It will be important to know which states follow the current UAA, the 2000 UAA, a state-amended version of the 2000 UAA, or some other statutory mechanism to regulate agents.

 

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Photo of Benjamin A. Tulis Benjamin A. Tulis

Benjamin Tulis is a principal in the Los Angeles, California, office of Jackson Lewis P.C. His practice focuses on advice and counsel within the labor and employment law sector. Ben is a member of the California Advice and Counsel resource group.

Ben counsels…

Benjamin Tulis is a principal in the Los Angeles, California, office of Jackson Lewis P.C. His practice focuses on advice and counsel within the labor and employment law sector. Ben is a member of the California Advice and Counsel resource group.

Ben counsels employers on a host of employment issues, including wage and hour laws, leaves of absence, employment-related agreements, incentive plans, independent contractor classifications, exempt/non-exempt classifications, company policies, reductions in force, workplace investigations, employee discipline, litigation avoidance and helping employers address legal developments on the fly as they arise. Ben assists employers with a wide variety of employment-related agreements, including but not limited to employment agreements, confidentiality agreements, commission agreements, incentive plans, contractor agreements, severance agreements, arbitration agreements and various other agreements with employees and third parties. Ben helps employers develop incentive arrangements, including commission arrangements with industry-specific compliance issues.