Owners' Lock Out of NFL Players Raises Some Big Questions

What do public employees in Madison earning $40,000 a year and professional football players in Green Bay earning $1.5 million a year have in common? They both face powerful and hostile managements trying to undermine their unions.

The battle between labor and management is always uneven. Up until the 1930s management didn’t even have to negotiate with its workers. Owners could fire union organizers. Courts routinely declared unions an illegal “restraint of trade” and ruled that by trying to negotiate collectively unions were violating the “contract rights” of individual employees and giant corporations to freely negotiate salaries and working conditions.

Only in 1937 did workers finally gain the legal right to form unions and bargain collectively. Corporations were legally required to bargain “in good faith”. Congress established the National Labor Relations Board (NLRB) and gave it judicial authority to enforce labor rights. The NLRB did so enthusiastically for the first few decades, modestly in the 1970s, and not at all after Ronald Reagan took office when he nominated, and Congress confirmed as Chairman of the NLRB Donald Dotson, a man who viewed collective bargaining the way 19th-century courts did, as “the destruction of individual freedom, and the destruction of the marketplace as the mechanism for determining the value of labor”.

Public service unions came of age when private sector unions were strong and the word “union” was a respected word. It was a time when Republican Dwight D. Eisenhower could announce, with widespread approval, "Only a fool would try to deprive working men and women of their right to join the union of their choice."

But even when unions were respected by society as a whole, they were rarely as respected by employers, public or private. Only in 1959 did Wisconsin become the first state to allow collective bargaining by public employees at the local level. In the South, public employee unions had to struggle for recognition, especially when they were composed largely of blacks.

We might recall that when Martin Luther King Jr. was assassinated in Memphis in April 1968 he was there to support a strike by sanitation workers. Two months earlier two black sanitation workers had been crushed to death when the compactor mechanism of the trash truck was accidentally triggered. In response to the tragedy, the city’s sanitation department gave each of the grieving families one month’s pay and $500 for funeral expenses. No one from the city government attended the funerals.

On February 12, 1968 more than 1,100 black sanitation workers began a strike for job safety, better wages and benefits, and union recognition. King's assassination did not dissipate the workers’ struggle for dignity. As Taylor Rogers, one of the strike’s organizers recalled, “If you stand up straight, people can’t ride your back. And that’s what we did. We stood up straight.”

The sanitation workers won. Their contract included union recognition, higher wages, a dues check-off, and the updating of the antiquated sanitation equipment. Another practice that had infuriated black workers—sending them home on rainy days without pay while white supervisors stayed and collected a paycheck—was also ended.

A Brief History of the Football Players Union

Professional football players also began to organize when private sector union density was at its peak. But neither the respect of neither unions nor the law convinced the team owners to negotiate. In 1956 players on the Green Bay Packers and Cleveland Browns formed an association and made minimal demands on their team owners: a minimum wage, per diem pay to cover expenses and, believe it or not, a request that the teams pay for their uniforms and equipment!

The owners never met with the players and refused to respond to any of their proposals.

As would be the case for the next 40 years, the players turned to the courts for help. The U.S. Supreme Court ruled that the NFL did not enjoy the same antitrust immunity that Major League Baseball did, opening the door to many NFL rules that limited player mobility and negotiating power to be viewed as illegal restraints of trade. Rather than face that prospect through another lawsuit, the owners granted several of the players' demands, including setting up a minimal pension plan. But the owners refused to enter into a collective bargaining agreement with the association.

In 1968, threatened by the possibility that the players would join the powerful Teamsters union, the owners said they would recognize the NFLPA if the Teamsters were rejected. The players did, but the owners reneged on their promise. The players voted to strike. The owners countered by declaring their first lockout. A few days later the owners relented, but the concessions won by the players were modest. According to Wikipedia, the owners agreed to contribute about $1.5 million to the pension fund but maintained current minimum salaries at $9,000 for rookies, $10,000 for veterans and $50 per exhibition game. The owners refused to allow for independent arbitration of player-management disputes.

In 1970, after the NFL and the AFL merger, their two players’ unions also merged. After a brief lockout, the players went on strike. They returned two days later when the owners threatened to cancel the season. The players did, however, gain the right to bargain through their own agents with the clubs and impartial arbitration but only for injury grievances. They gained some improvements in basic salaries and pensions, and dental care. Following negotiations, the owners retaliated by letting go many union player representatives from their teams.

In 1963, NFL Commissioner Pete Rozelle had unilaterally imposed what became known as the Rozelle Rule. The timing was instructive. That was the year after he negotiated the NFL’s first broadcast contract with CBS--$9.3 million for two years. Each team began the season with $332,000 in the bank, a sum greater than most teams’ payrolls at the time. Thus all teams were guaranteed a profit even before they sold a single ticket or played a single game. Flush with cash, the team owners could have started a bidding war if players were free to sell their services to the highest bidder. The Rozelle Rule all but eliminated free agency by allowing any team that lost a free agent to another team to receive something of equal value from that team. Few teams were willing to risk signing a high-profile free agent only to see their own rosters depleted.

Coincidentally but not accidentally, the agreement by the NFL owners to share national broadcast revenues equally not only opened up the specter of higher player salaries; it also raised the possibility of future Green Bay Packers---non-profit teams in small cities owned by their fans. So in 1963 the League also adopted a rule banning any further such ownership structures.

In 1974 the players again went on strike, this time focusing on the hated Rozelle Rule. The players rallied under the banner, “No Freedom, No Football” but gave up six weeks later. They again turned to the courts for help.

In 1977 John Mackey of the Baltimore Colts became the first NFL player to successfully defeat the League owners in court. Along with 35 other NFL players, he challenged the validity of the Rozelle Rule. The owners argued that the rule was part of a collective bargaining agreement and therefore exempt from antitrust law, a legal argument that, as we shall see, has played an important role in player-management conflicts. The court disagreed, concluding the Rule was not the product of good faith bargaining but had been forced upon a weak players union.

The owners reached a settlement with the union. Impartial arbitration of all grievances was implemented. Some free agent restrictions were ended. But the League’s new version of free agency was almost as restrictive as its first. Indeed, from 1977 to 1987 only one player changed clubs out of the thousands of free agents who were eligible.

In 1982, the players again took on free agency. They went on strike for 57 days. The owners refused to budge. One reason was that their TV contracts with the networks, which provided about 60 percent of the owners' income, guaranteed they would be paid whether games were played or not. The players capitulated.

In 1987 the players again tried to allow individual players to enter a true marketplace for their talents. When no progress was made in the negotiations after two weeks of regular season play, the players voted to strike. The league responded by canceling games and hiring replacement players. The strike was broken. The union voted to return to work.

The day the strike ended, the players once again turned to the courts. The NFLPA filed an antitrust suit in Federal Court. The Court of Appeals ultimately rejected that suit. You might have to be a lawyer to understand the logic, so read closely. The Supreme Court held that even in the absence of current collective bargaining agreement, as long as a bargaining relationship still exists the antitrust immunity holds. In other words, so long as collective bargaining was deemed to be continuing, the antitrust law could not be invoked. The Chief Judge presciently dissented, noting, “this court’s unprecedented decision leads to the ineluctable result of union decertification in order to invoke rights to which players are clearly entitled under the antitrust laws.”

Gabriel Feldman, law professor at the Tulane Sports Law program explains, “Essentially, players are required to choose labor law (and collective bargaining) or antitrust law (and individual bargaining and litigation). If the players choose labor law, an antitrust shield is raised that prevents them from attacking NFL rules under the antitrust laws. To lower the shield and choose antitrust law, the players must end the collective bargaining relationship.”

Forced to make this choice, in December 1989 the players voted to end the NFLPA’s status as the players’ collective bargaining agent. The NFLPA then re-formed as a voluntary professional association.

Since the NFLPA no longer represented the players in collective bargaining, individual union members were free to bring an antitrust action against the NFL challenging its free agency rules as an unlawful restraint of trade. A group of players, led by New York Jets running back Freeman McNeil filed suit challenging the restrictions on free agency. An all-woman jury in Minnesota heard the case in 1992. Pat Bowlen, owner of the Denver Broncos complained to the Rocky Mountain News that he didn’t want “eight women who are basically domestic housewives to decide the future of the National Football League.”

In 1992, they did by ruling in the players’ favor.

That verdict and the threat of a class action suit filed by Philadelphia Eagles player Reggie White on behalf of all NFL players brought the parties back to the negotiating table. Under the auspices of U.S. District Court Judge David Doty, the NFL finally agreed on a formula that permitted free agency. In return, the owners demanded and received a salary cap, albeit one tied to a formula based on players' share of total league revenues.

Once the agreement was approved the NFLPA reconstituted itself as a labor union and entered into a new collective bargaining agreement with the league. Players won unrestricted free agency for the first time and were guaranteed a higher percentage of major league revenues in return for giving the owners a salary cap on payrolls.

The NFLPA and the league have extended their 1993 agreement five times, most recently in March 2006 when it was extended through the 2011 season after the NFL owners voted 30-2 to accept the NFLPA's final proposal. In 2010 the NFL exercised its option to terminate that contract, effective March 3, 2011.

The NFL owners had an ace up their sleeve. Just as they had in 1982, in 2010 they had signed a contract with broadcasters—CBS, ESPN, NBC, and Direct TV—such that the NFL would accept significantly lower revenue in return for a guarantee that it would receive about $4 billion even if the season were not played. This was designed to give them enormous bargaining leverage.

Two days before the lockout, Judge Doty ruled that by insisting on this lockout provision as part of the broadcast contract, and by agreeing to take significantly less money in return, the NFL had breached its collective bargaining agreement with the NFLPA, an agreement that required both parties (players and owners) to act in good faith to maximize total revenues that both parties would receive. That stripped away, at least for the time being (the owners have appealed), the owners' $4 billion lockout fund.

They locked out the players anyway. The NFLPA sued, asking for the courts to issue an injunction ending the lockout. A hearing on the issue will be held April 6. Meanwhile the union has again decertified, again to allow its players to challenge the owners under the antitrust law. The owners have filed a complaint to the NLRB, arguing that the decertification is an unfair labor practice.

And that’s where things stand today.

Millionaires vs. Billionaires?

Currently the revenues are split about 50-50 between players and owners. (The net revenues, after the owners subtract some of their expenses from the total, an amount worth more than $1 billion in 2010, are split 57-43 in the players’ favor, a percentage you often read in the media.) The owners want the players to give back about $1 billion that is coming to them under the 2008 contract.

The owners argue that while the players’ percentage will decline, the amount they receive will not if they agree to another of the owners’ demands: extending the regular season to 18 regular games. The current schedule has 16 regular season games, up from 14 in 1977 and 12 in 1960.

Another issue is whether to cap the rookie’s pay scale and if so, what to do with the money saved. Both the players and the owners agree that there should be a rookie pay cap. But the players want half of the estimated $200 million in savings put toward retired players and the other half toward veteran players. The owners want to keep the money.

The media so far is describing the labor battle as millionaires fighting billionaires. And it is true that the median salary across the NFL is a handsome $1.4 million a year. The rookie minimum is $310,000.

But the length of an average NFL player’s career is only 3.6 years. And even a short career takes a heavy toll on their bodies. The owners watch from cushy seats in heated skyboxes. The players are down on a hard, cold field, engaged in a very violent game. In 2010, 350 players were on the injured reserve list for an average of nine and a half games.

At the Superbowl we watched Packer star cornerback Charles Woodson exit the game with a broken collarbone, Packers cornerback Sam Shields leave with an injured shoulder and Steeler star receiver Emmanuel Sanders sit out almost the whole game with a foot injury. Green Bay’s quarterback, Aaron Rodgers, has suffered two concussions this year. The announcers noted he now wears a special helmet.

Each professional football player now has a l0 percent chance of sustaining a concussion in a given season. Mild traumatic brain injury (MTBI), the medical term for concussions, has become the most common specified type of injury in pro football, occurring nearly twice as often as hamstring strains.

The Centers for Disease Control estimates that l5 percent of patients diagnosed with MTBI experienced disabling problems on a “persistent” basis.

The long-term health risks associated with NFL injuries include a significantly increased likelihood of Alzheimer’s or dementia.

A 1994 study of 7,000 former players by the National Institute of Occupational Safety and Health found that football linemen have a 52 percent greater risk of dying from heart disease than the general population.

Essentially, the quality of life of an ex-football player is likely to be diminished from his life on the field. Even more damning, the quantity of his life will also be diminished. The average NFL player who plays for more than five years has a life expectancy of 55 years. If he is a lineman this drops to 52 years. U.S. life expectancy overall is 77.6 years.

To my knowledge, there have been no studies of the life expectancy of NFL owners. But since life expectancy is correlated with wealth it is likely they live longer than the rest of us.

Since a professional football player’s tenure is so short and the probability of debilitating injury so high, a key issue in labor negotiations is the level of medical benefits and pension. NFL pensions are skimpy. The pensions are vested only after four years. (Recall that the average player’s career lasts only 3.6 years.) Even long-term players receive little, especially in comparison to other professional sports leagues like major league baseball. According to former cornerback Bernie Parrish, Major League Baseball pays average pension benefits three times higher than those offered by the NFL: $36,700 vs. $12,165.

Former Packers guard Jerry Kramer gets a pension of $358 per month. Willie Wood, who helped Vince Lombardi win five championships during Wood’s 12 seasons, is now in a wheelchair. He receives a pension of $2,000 a month.

Baseball’s gross income is about $4.3 billion. Last year the NFL grossed over $7 billion. As Parrish says, “There is no excuse not to have the NFL retirement benefits matching MLB’s.”

As for medical care, only in 2007, after enormous public pressure and congressional hearings about the disabilities of professional football players, did the NFL create the “88 plan”. The number refers to the number worn by John Mackey who played for the Baltimore Colts in the 1960s, was the first president of the NFLPA, and was one of those let go by his team because of his role in the 1970 strike. It is also the amount the NFL currently pays for institutional care for an ex-player suffering from Alzheimer’s or other forms of dementia: $88,000.

It is possible the issue of disability benefits and medical care will be decided, as have so many other issues, in the courts. An increasing number of NFL players are suing the NFL on these issues. A class action suit would have a powerful impact.

The football players union is not perfect. For one thing, it hasn’t represented well the interests of all its members, focusing instead on enabling ever-higher salaries for its current players. Some 50 years ago the team owners agreed to share equally the network broadcasting revenue but the players have yet to divide up their collective revenue more fairly between current players and retirees.

The NFLPA can also be criticized for not using its member’s fame and influence to assist other workers. NFL stars do not walk the picket lines when other workers strike. They do not honor the picket lines of other workers. This has been starkly emphasized in Madison. To their credit, six members of the Green Bay Packers did sign a letter of support for the public employees that maintained, in part, “When workers join together it serves as a check on corporate power and helps ALL workers by raising community standards.”

But no Packer stars or even, to my knowledge, players in the starting lineup at the Superbowl, have made public their support for other Wisconsin unions.

Indeed, the NFLPA shies away from the word, union. Instead, it calls itself an association. Probably because they believe union has disagreeable connotations in modern America where less than 12 percent of the workforce belongs to a union. Given the polls about public support of unions after the Madison uprising, they might want to reconsider that belief. The word "union" projects a strength and unity of purpose that "association" lacks. And that strength and unity will be crucial when faced with the power and influence of 32 team owners with collective wealth over $40 billion.


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