Not much knowledge to address all the legalities. Do know there is a better way than what is happening. Also know that revenue sharing is coming, so isn't that in the near future anyway?? so, if it's going to happen, control it, do something with the collectives, and reign all this in and keep it as college level as possible. In a roundabout way it was always pay for play. Thing they call scholarships that covered the cost of the educations for playing sports. Only NCAA baseball got the shaft cause they were limited to 11.5 scholly's for 26 man rosters. And other sports as well. It's no more a mess now than it has always been. Always had to be money under the table cause the NCAA was too lazy to improve the system before it went berzerk.
I'm old school. My preferred resolution is to offer all scholarship students the full ride plus suitable monthly stipend enough to keep the table clean. That's it. At some point this will spill over into the non-athletic full rides claiming they are treated as employess. How is a music major on full ride any different. Full scholly for an expected service. Makes them employees too, right? And it's no less important to them. Starting with sports is just the tip of the iceberg. This fiasco will get bigger by the decades.
Very few athletes go pro in any sport. Those that do have a short shelf life on average. Most will never enjoy these payouts too far past their playing days cause of family and friend handouts and lack of understanding of the cost of large contracts in the pros. Over 50% of those contracts are already gone and committed to taxes and such before the athlete ever spends a dime. A $10 mil payout is down to roughly $5.8 mil minus the jock tax they pay for games played in other states with state income tax. Plus, these contracts only pay over the length of the season. They gotta budget their posse life over the next 6-8 motnhs. Regardless of one's take on the subject, the school is offering a way to prepare for life after sports, and always have. And technically, by way of scholly for play, any person whether athletic, arts or whatever, that has been on scholly has always been an employee by definition.