Collective Bargaining in Professional Sports

Player Salaries, Free Agency, Team Ownership, League Organizational Structures and the Power of Commissioners

Scott Bukstein

• Publisher: Taylor & Francis
• Year: 2020
• Print ISBN: 9781138708037
• eBook ISBN: 9781351781473
• Edition: 1
• Topic: Economics
• Subtopic: Sport & Exercise Science
• Index: Economics

Collective Bargaining in Professional Sports provides a timely and practical overview of the impact and importance of the collective bargaining process in the business of professional sports in the United States.

Focusing on the contemporary history of collective bargaining in the National Basketball Association (NBA) and the National Football League (NFL), but drawing out important lessons for all professional sports, the book sheds light on some of the key issues within modern sport business and sport governance. It offers an inside look into topics such as revenue sharing, competitive balance, circumvention of league rules, player free agency, player social activism, player discipline, and the ethical and legal issues around the use of wearable biometric tracking systems to collect player data.

An essential read for sports business industry practitioners and students alike, this is fascinating reading for anybody with an interest in sport business, sport law or labor relations. It is also a valuable resource for anyone who wants to increase their understanding of the business and financial operations of professional sports leagues and teams, player contracts and salaries, and the role and authority of professional sports league commissioners.

1 Introduction to collective bargaining in professional sports

Overview of chapter contents

The primary purpose of this book is to provide an overview of the business of professional sports in the United States while also detailing the impact and importance of collective bargaining. This initial book chapter explains how the overall legal framework and business operations of major professional sports leagues in the United States are direct byproducts of the collective bargaining process.¹ Team owners and league players negotiate comprehensive contracts called collective bargaining agreements, which contain provisions related to player salaries, free agency (player mobility), the distribution of revenue between team owners and players as well as the authority of league commissioners. Imperfect or unclear collective bargaining agreement provisions can create tension and lead to disputes between players, team owners and league commissioners. These labor disputes often result in formal legal proceedings, as both players and team owners attempt to gain negotiation leverage during the collective bargaining process.

This chapter contains an overview of the historical evolution of collective bargaining within professional sports. This chapter also provides an outline of the primary categories and terms generally covered by current collective bargaining agreements within professional sports. In addition, this chapter spotlights the primary legal areas and laws that inform and influence the collective bargaining process. This chapter also discusses the main groups of people usually involved in the collective bargaining process. This chapter then summarizes the typical tactics and strategies utilized by players and team owners in order to develop or shift negotiation leverage during the collective bargaining process. Finally, this chapter previews some of the content that will appear in the remaining chapters within this book on collective bargaining in professional sports.

The evolution of collective bargaining in professional sports

As explained by legal scholars Paul Weiler and Gary Roberts, “Whether through work stoppages or peaceful collective bargaining, sports unionism has transformed all the rules of the game for dealings between individual teams and players.”² Employee unions within professional sports leagues in the United States began to surface during the 1950s and 1960s. For instance, the National Basketball Players Association (NBPA) was originally formed in 1954. Two years later, in 1956, the National Football League Players Association (NFLPA) formed. The Major League Baseball Players Association (MLBPA) was founded in 1966.³ Each of these player advocacy groups “were deliberately named associations rather than unions, because the latter term was considered appropriate only for the teams’ concession vendors or maintenance crews, not for elite athletes.”⁴

The primary purpose of a players association is to protect and advocate for the mutual interests of all athletes within a particular professional sports league. A players association also functions as the exclusive collective bargaining representative for all athletes within the league.⁵ Collective bargaining describes the process by which a players association negotiates with league management (team owners) to establish the working conditions, salaries, benefits and other important terms of employment for all players within the league. The terms and provisions contained within the resultant collective bargaining agreement (CBA) prevail over a league’s enunciated rules or the individual contracts reached between a player and a league.⁶ As explained by Professor Gabe Feldman, the fundamental policy underlying collective bargaining in professional sports is to encourage players (labor) and team owners (management) to “enter voluntarily into collective bargaining agreements without government interference.”⁷

Early efforts and initial priorities of players associations (1950s to 1970s)

Players associations have fought many “hard battles” since the 1950s in order to bring team owners to the bargaining table to negotiate meaningfully on issues vitally important to players.⁸ During the 1950s, 1960s and 1970s, players associations generally raised concerns related to improving player rights, creating heightened player job security, developing athlete pension (retirement) plans, increasing minimum salaries for players, allowing additional player mobility (free agency) and addressing other fringe benefit areas such as health insurance coverage and life insurance policies.⁹

Major League Baseball Players Association (MLBPA)

Before the Major League Baseball Players Association (MLBPA) was formed in 1966, team owners set the rules without consultation from the players, and those rules were subject to change without notice. Players were not even provided with copies of the rules (“the laws of baseball”) that applied to them. Instead, players were expected to rely on the good faith of the team owners and the league commissioner (who was hired by the team owners).¹⁰

Shortly after being named the first executive director of the MLBPA in 1966, Marvin Miller’s preliminary priorities were to “shore up the union’s finances by beginning a group licensing program and educating the players about the fundamentals of organizing and solidarity.”¹¹ In December 1966, the MLBPA and team owners reached an initial agreement for a player benefit plan, which primarily covered pensions and insurance. More than a year passed before the MLBPA and league management would reach consensus on a comprehensive collective bargaining agreement in February 1968, which covered areas such as minimum thresholds for player salaries along with many other terms and conditions of a major league baseball player’s employment.¹² The 1968 Major League Baseball (MLB) collective bargaining agreement, which was the first-ever CBA in professional sports, “raised the minimum salary in baseball from $6,000—the level at which it had been stuck for two decades—to $10,000, and set the tone for future advances.”¹³

One of the primary reasons for unionization among professional athletes in the 1960s and 1970s was to generate opposition to the reserve system and to advance an aspiration for free agency. A reserve system prevented a player from negotiating with any team other than the team he played on during the prior season—this elimination in negotiation competition among teams in the league resulted in a reduction in overall wages for players.¹⁴ The “reserve clause” functioned as a provision in the standard MLB player contract, which provided that so long as the player’s current team extended a new contract offer to the player by some specified date prior to the next season, the current contract would consequently be extended for one more playing season. MLB teams were permitted to perpetually extend the contract of each player by one season after every season. As a result, players had no ability to sign a contract with another team unless the current team decided not to renew that player’s contract.¹⁵ According to the MLBPA official website, MLB team owners “had ruled baseball with an iron fist for nearly a century prior to Marvin Miller’s appointment as the MLBPA’s executive director. Players had no ability to choose their employer because they were tied to their original club by a ‘reserve clause’ in every player contract that provided for automatic renewal. Salaries and benefits were low [and] working conditions abysmal.”¹⁶ During the 1976 MLB season, the MLBPA and MLB team owners agreed to a modified player reserve clause that would only apply to players who were in their first six years in the major leagues. After six years of service, an MLB player would become a free agent upon expiration of his then-current contract. As explained by legal scholar Stuart Banner, “Football, basketball and hockey lacked an antitrust exemption, but through collective bargaining they reached virtually the same outcome as baseball regarding free agency.”¹⁷

Although the remaining chapters within this book focus primarily on collective bargaining within the National Basketball Association (NBA) and National Football League (NFL), it is important to understand the meaningful role that the MLBPA has played in expanding player rights through the collective bargaining process.¹⁸ The players associations within the NBA and NFL have historically monitored and subsequently borrowed/implemented best practices from the MLBPA with respect to collective bargaining negotiation tactics and player advocacy.

National Basketball Players Association (NBPA)

Before the NBPA was established in 1954, NBA players did not receive any retirement pension or health benefits. In addition, players were not entitled to a minimum wage per season—prior to the formation of the NBPA, the average NBA player salary was approximately $8,000.¹⁹ Some of the top players in the NBA during the 1950s and 1960s, including Bob Cousy and Oscar Robertson, played a pivotal role in the creation and evolution of the NBPA. For example, during the week of the 1955 NBA All-Star Game in New York City, Bob Cousy (star point guard for the Boston Celtics from 1950–1963) voiced the following collective concerns and requests of NBA players to then-current NBA president Maurice Podoloff:

• Payment of back salaries to individuals who played on the defunct Baltimore Bullets club before the te...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• 1 Introduction to collective bargaining in professional sports
• 2 Collective bargaining in the NBA—part 1
• 3 Collective bargaining in the NBA—part 2
• 4 Collective bargaining in the NFL—part 1
• 5 Collective bargaining in the NFL—part 2
• 6 The future of collective bargaining in professional sports
• Index