House v. NCAA settlement allows schools to directly pay athletes

Judge Claudia Wilken approved a settlement in House v. NCAA on Friday night. Following that decision, schools will be permitted to pay student-athletes directly beginning on July 1.

While name, image and likeness, or NIL, has allowed for compensation to college athletes for the last four years, this will change how the compensation works.

ESPN’s Dan Murphy explained the differences.

“Since 2021, college athletes have been allowed to make money from third parties via name, image and likeness (NIL) deals,” Murphy said. “Boosters quickly organized groups called collectives that used NIL money as de facto salaries for their teams, in some cases paying millions of dollars mostly to top-rated basketball and football players. Now, that money will come straight from the athletic department.”

Pete Nakos of On3.com laid out how things will look following Friday’s ruling.

Beginning July 1, schools will be able to share $20.5 million with athletes, with football expected to receive 75%, followed by men’s basketball (15%), women’s basketball (5%) and the remainder of sports (5%). The amount shared in revenue will increase annually.

Power Four football programs will have roughly $13 to $16 million to spend on rosters for the 2025 season. Many schools have front-loaded contracts ahead of the settlement’s approval, taking advantage of contracts not being vetted by the newly formed NIL clearinghouse.

There are also back damages to be paid. The ruling detailed what those will look like.

“Pursuant to the SA, Defendants have agreed to pay $2.576 billion in total to compensate members of the damages classes. Damages payments will be paid yearly over the course of ten years following the Effective Date.”

Additionally, as Chris Vanini of The Athletic reported, there are changes to the roster limits for FBS football teams.

With the House settlement, FBS football rosters will drop to a 105-player limit BUT

– All can be on scholarship, no more 85 limit
– Schools are not expected to use all 105 schols and will have walk-ons
– Players who would’ve been cut can be grandfathered in for their careers

— Chris Vannini (@ChrisVannini) June 7, 2025

It’s not an exaggeration to say that this is one of the most significant rulings in the history of college athletics.