The NFL and the NFLPA: The Significance of the Current Collective Bargaining Process and a Collection of Relevant Legal and Ethical Issues (Part 5: Conclusions and Bibliography.)

 

As the lights go out in Cowboys Stadium at the conclusion of Super Bowl XLV, the clock will be ticking for both sides to finalize a new collective bargaining agreement.

Conclusions: A Final Assessment of Each Side’s Arguments and a Second Look through the Legal Lens at the History of Collective Bargaining in the NFL

League revenue reached $4.3 billion in 2001, exceeded $6 billion in 2005, and passed $8 billion at the end of fiscal 2009 (Lee, p. 87).  Certainly, there are signs of growth throughout the league, though the Packers’ arguments regarding rising operational costs and player costs that are growing faster than net income stand as legitimate concerns for team owners.  Since teams – except the publicly owned Green Bay Packers – refuse to open their accounting books for all to see, a lack of transparency prevents analysts from achieving a clear understanding of the debate over a new collective bargaining agreement.  The most valid position – in logical terms, the only side offering enough evidence to form a valid argument – regarding revenue-sharing in the battle between NFL management and players belongs to the NFLPA when we rely on the sources I chose for this project.  Statistical analyses, such as a multiple regression of team revenue, retained earnings, player costs, and net income across the league would help resolve the argument between the NFL and the players’ union, since inferences could be drawn from the entire population of thirty-two teams.  With only one team’s financial data, however, statistical conclusions cannot be drawn with any confidence; in other words, analysts cannot extrapolate figures for the rest of the league from the Green Bay Packers’ financial statements.  Arguments are strong on both sides regarding an 18-game season and a rookie salary cap, but the owners’ position on revenue-sharing forces the union to accept claims of financial hardship without many references to concrete financial data.

At this point, the NFLPA may choose to decertify and use antitrust laws to sue the NFL.  “If the NFLPA were to decertify, it would, in effect, operate as a trade organization but cease to be a union,” writes Liz Mullen of the Sports Business Journal (2010, p. 27).  The union is gaining player support to exercise the option to decertify and impose a firm deadline for owners to act, since it must sue before the CBA expires or it will have to wait six months after 3 March 2010 to pursue legal action (Mullen, 2010, p. 27).

Should the union decertify, though, the NFL could gain the upper hand.  In 1989, the

An artist's rendition of the NFLPA's Demaurice Smith as found on the Sports Illustrated website.

NFLPA decertified “only to become a union again in 1993, after it won a jury trial in the Reggie White v. NFL case,” according to Mullen (2010, p. 27). The NFLPA would also relinquish its ability to collectively bargain and represent players before the league, collect dues, and lose players’ licensing and marketing rights (Mullen, 2010, p. 27).  Nevertheless, decertification would “allow the union to legally challenge any NFL plan to unilaterally implement a new labor system” (Mullen, 2010, p. 27).  If the NFLPA sued and used antitrust laws, the league could defend itself by using the “single entity defense” since the “Supreme Court ruled that a single entity cannot conspire with itself in violation… of the Sherman Act” (Kahn, 2009, p. 860).  Even though the NFL has a defense from antitrust laws, the NFLPA could persist and hope for an outcome similar to the Curt Flood Act, “named after the player who had unsuccessfully sued [Major League Baseball] under antitrust laws in 1972, which removed baseball’s antitrust exemption in labor matters” (Kahn, 2009, p. 862).

The outcome could be even more positive for the players, however.  Kahn’s study shows how the NFLPA could succeed if it took the NFL to court over antitrust laws.  Player payroll rose from 41% of league revenue in 1990 to 67% in 1996: a direct result of the union decertifying and taking the league to court over alleged violations of federal antitrust laws (Kahn, 2009, p. 874).  The NFL argues that union decertification would be a “sham” and would be caused by the union’s efforts to gain access to antitrust laws, but regarding decertification, “the [Supreme] Court left open the possibility of future labor-related antitrust suits” under such circumstances (Kahn, 2009, p. 875).  Therefore, the NFLPA has a strong option in decertification.

In all, the NFLPA has valid and strong arguments regarding revenue-sharing and an 18-game season, especially when the history of NFL collective bargaining is viewed from a legal perspective.  Both sides could benefit from collective bargaining and resolving the matter before 3 March 2011, but if the dispute between the union and team owners goes to federal court, anything could happen.  The NFLPA could win big like in 1993; or, in the event of a loss in court, it could set a precedent that would not allow unions to decertify only to gain access to antitrust laws.  On the other hand, the NFL could be shielded from antitrust laws by the “single entity” defense and defeat the NFLPA in federal court; however, if the NFL cannot win in court, the league could lose its antitrust exemption like Major League Baseball in 1972 with the Curt Flood Act.

Though several other legal and ethical issues define the current collective bargaining process – including the battle between owners involving revenue-sharing among the NFL’s thirty-two teams – over the past five weeks in this five-part report we have taken a broad look at literature that reveals certain intricacies of the debate on the CBA.  Below my signature, please find the bibliography of sources I examined for this analysis.  I hope you now have a clearer understanding of the NFL’s current collective bargaining process, and if there are any questions or comments, please feel free to post them here or send me an email.

Cam Suarez-Bitar.

Bibliography

Aikman, Troy.  (2009, August 31).  Enjoy This Season: Labor Pains Could be Right Around the Corner.  Sporting News, 233(19/20), p. 43. (http://content.ebscohost.com/ContentServer.asp?T=P& P=AN& K=44002287& EbscoContent=dGJyMMvl7ESep7M4zOX0OLCmr0ieqK9Srq%2B4TLeWxWXS& ContentCustomer=dGJyMPGus0mxrLVRuePfgeyx%2BEu3q64A& D=aph )

Associated Press.  Colts’ Bill Polian: NFL’s 18-Game Season is “Fait Accompli.” (2010, September 28) USA Today, Sports, NFL, (http://www.usatoday.com/sports/football/nfl/2010-09-27-bill-polian-18-game-season_N.htm)

Associated Press.  Goodell Pushes for a New Stadium in Atlanta.  (2010, November 11).  ESPN.com, (http://sports.espn.go.com/espn/wire?section=nfl&id=5793484)

Associated Press.  Goodell: Rookie Pay Scale “Ridiculous.”  (2008).  NFL.com, (http://www.nfl.com/news/story?confirm=true&id=09000d5d80909cc9&template=with-video)

Baschnagel, Charles N.  An Analysis of the Effects of the 1993 NFL Salary Cap on Competitive Balance and League Revenue: Has anticompetitive behavior led to better competition? Available from Ebscohost database.

Dividing Line is Drawn.  (2010, March 3).  USA Today, Sports p. 1c.

Green Bay Packers Audit performed by the Wisconsin Legislative Audit Bureau, 1999.  Retrieved from Google.com search for “Green Bay Packers financial statements.”  File found online in .pdf format.

Kahn, Lawrence M.  (2009).  Sports, Antitrust Enforcement, and Collective Bargaining.  The Antitrust Bulletin, 54(4), p. 857-881. (http://proquest.umi.com/pqdweb?did=1973216451& Fmt=6& VInst=PROD& VType=PQD& RQT=309& VName=PQD& )

Kaplan, Daniel.  (2010, November 1).  NFL Pools $900M for Labor Fight.  Sports Business Journal, 13(27), p.1, p. 36.

King, Peter.  (2010, October 18).  The Gathering Storm.  Sports Illustrated, 113(14), p. 44-46.

Kuriloff, Aaron.  (2010, July 14).  Green Bay Packers Net Income Rises 30% in Annual Report Amid Labor Talks. Bloomberg.com, (http://www.bloomberg.com/news/2010-07-14/green-bay-packers-net-income-rises-30-in-annual-report-amid-labor-talks.html)

La Canfora, Jason.  (2010, July 14).  Pack Thriving and Suffering, Depending on Who’s Reading Ledger.  NFL.com, (http://www.nfl.com/news/story/09000d5d8191f3cb/article/pack-thriving-and-suffering-depending-on-whos-reading-ledger)

La Canfora, Jason.  (2010, July 14).  Packers Cite Player Costs in $10.3 Million Drop in Operating Profit. NFL.com, (http://www.nfl.com/news/story/09000d5d8191dcca/article/packers-cite-player-costs-in-drop-in-operating-profit)

Labor is Focus at NFL Meeting. (2009, March 24).  USA Today, p. 10c.

Lee, Travis.  (2010).  Competitive Balance in the National Football League After the 1993 Collective Bargaining Agreement.  Journal of Sports Economics, 11(1), p. 77-88. DOI 10.1177/1527002509336207 545MN

Lobdell, Colin.  (2010, October 23).  Can NFL Players Survive an 18-Game Season? Bleacher Report. (http://bleacherreport.com/articles/499818-can-nfl-players-survive-an-18-game-season)

Mullen, Liz.  (2010, November 1).  Labor Uncertainty, Reluctant Recruits Hampering Agents.  Sports Business Journal, (https://www.sportsbusinessjournal.com/article/67304)

Mullen, Liz.  (2010, September 13).  Union Seeks Authority to Decertify.  Sports Business Journal, 13(20), p. 27.

Murphy, Nick.  (2010, November 4).  Guest Column by Nick Murphy: The Numbers Don’t Lie.  Retrieved November 5, 2010 from NFLPlayers.com.  (http://www.nflplayers.com/Articles/CBA-News/Guest-Column-by-Nick-Murphy-The-Numbers-Dont-Lie/)

NFL.com.  (2006-2010).  NFL Collective Bargaining Agreement 2006-2010. Available from NFL.com database.  Searched Google.com for “current NFL collective bargaining agreement” – results: static.nfl.com/static/content/public/…/cba/nflcba-2006-2012.pdf

NFLPlayers.com.  (2010).  Breaking News: Player Breaks Down Revenue Discrepancy.  Retrieved November 5, 2010 from NFLPA.com database. (http://www.nflplayers.com/Articles/CBA-News/Breaking-News-Player-Breaks-Down-Revenue-Discrepancy/)

NFLPlayers.com.  (2010, June 16).  Lewis, Brady Sound Off on Potential Expanded Season.  Retrieved November 4, 2010, from NFLPA.com database.  (http://www.nflplayers.com/Articles/CBA-News/Lewis-Brady-Sound-Off-on-Potential-Expanded-Season/)

NFLPlayers.com.  (2010). NFLPA Lockout Central. Retrieved November 5, 2010, from NFLPA.com database. (http://www.nflplayers.com/about-us/2011-Lockout-Central/)

NFLPlayers.com.  (2010).  Taxpayer Subsidies for NFL Stadiums.  NFLPA.com, (http://www.nflplayers.com/Articles/CBA-News/Taxpayer-Subsidies-for-NFL-Stadiums/)

NFLPlayers.com.  (2010).  Players’ Workers Compensation Issues.  Retrieved November 5, 2010, from NFLPA.com database. (http://images.nflplayers.com/mediaResources/files/Workers%20Comp_FACTS.pdf)

Players Knock Goodell During Camp Tour. (2010, August 10).  USA Today, Sports p. 3c.

Roberts, Gary R.  (1988).  The Evolving Confusion of Professional Sports Antitrust, the Rule of Reason, and the Doctrine of Ancillary Restraints.  Southern California Law Review, 61 S. Cal. L. Rev. 943.

Schiess, Wayne.  (2010).  Advice for Drafting a New NFL Collective Bargaining Agreement.  Texas Review of Entertainment & Sports Law11(2), p.205-217.  (http://content.ebscohost.com/ContentServer.asp?T=P& P=AN& K=51229487& EbscoContent=dGJyMMvl7ESep7M4zOX0OLCmr0iep7ZSs6e4S7CWxWXS& ContentCustomer=dGJyMPGus0mxrLVRuePfgeyx%2BEu3q64A& D=aph )

Standstill Irks Union Leader.  (2009, September 9).  USA Today, Sports p. 10c.

Trotter, Jim.  (2010, September 20).  Going Digital.  Sports Illustrated, 113(10), p. 14

Walker, Don.  (2010, July 14).  Packers’ Worth, Worries Up.  Wall Street Journal, (http://www.jsonline.com/sports/packers/98472199.html)

Wilner, Barry.  (2010, October 13).  NFL Owners Show Optimism About Reaching a New CBA.  Yahoo! Sports, (http://sports.yahoo.com/nfl/news?slug=ap-nflmeetings)

 

Just under two months remain before the current CBA expires. Negotiations are heating up between the owners and the NFLPA.

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