Collective Bargaining Agreements Evolution in NBA, NFL and MLB.

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Collective bargaining (CBAs) is a method of arbitration of problems concerning games between sports professionals and player associations (Caldwell, 2010). For a long time it has existed in sports. At the beginning of the 20th century it became well-known. The collective bargain is about taking control from one side and giving it to another, with one aspect of the divisive history of sport (Dryer, 2008). The deals between players and the owners of the league include compensation, dispute settlement and other problems surrounding the relationships between the employer and the employee. Today, the National Basketball Association (NBA), Major League Baseball (MLB), and National Football League (NFL) in the United States have a distinct agreement that governs their leagues. The evolution of CBAs among the three-sport professional leagues in the U. S. that are NBA, MLB, and NFL will be examined. Besides, it will be discussed the differences between the three CBAs and their impact on the sporting sector.

NBA Collective Bargaining Agreement

Basketball was primarily an unregulated activity that did not have a precedent for government or labor union. The control of the National Basketball League and Basketball Association of America was under the franchise within an individual organization. The sports monitoring and regulation by a body appeared in 1954 through the formation of national basketball players union by Bob Cousy. In the period between 1946 and 1949, the players employed the two opposing leagues to place a demand on their salary (Lowell, 1973). They would threaten to switch the league if their pay demand were unmet. However, in 1949 the two leagues merged to form National Basketball Association (NBA) (Caldwell, 2010). The left athletes chose between playing for NBA or Amateur Athletic Union Basketball for a firm. The options did not take into account the rights of players, so Cousy became the NBA President in 1955 with a list of player’s rights. His efforts were opposed by the league and the owners. Later after several attempts and meetings, NBA accepted to negotiate with players. Through the bargain players would enjoy some rights such as necessary treatment in the television and radio appearances, moving of sportsman’s expenses if he entered the market in the season, referral of the owner-player disputes to NBA, and elimination of exhibition games within three days after the season opens (Parlow, 2009).

Later in 1964, the player union negotiated the pension plan for the retired NBA players. The pension scheme required the employees to contribute 50% for the payment of $2000 endowment (Parlow, 2009). Later in 1967 the players association acquired pension plan of $ 600 monthly for those who were 65 years and had played for 10years (Caldwell, 2010). Then the organization of players raised minimum salary to $10,000 and pension for a veteran to $12,500. In 1983 there were significant financial losses that affected the franchise and the league. Due to the losses, a lot of deferred payment arose which almost led to strikes. Due to the increase in differed sums, the players association entered a CBA that provided players with a salary cap of 53-57% of the NBA gross revenues, and the league supported 253 jobs for the players even if the number of teams reduced (Dryer, 2008). In 1995 employers demanded new CBAs. The two parties signed a new deal in 1996 that stipulated that all the players have unrestricted free agency after the completion of their contracts. The CBA also imposed a salary cap with graduated scale depending on the position of the player and a guarantee to everyone that they would receive 48.8% of all incomes from basketball (Parlow, 2009).

In 1997-1998, the owners called for a new CBA due to the loss occurred by 13 teams at the end of the season. They forced the players union to enter the agreement by stopping the work and locking players out. The players lost half of the season and finally agreed to negotiate on their maximum salary that relied on the number of years on the league, longer rookie contracts as well as escrow tax if the income were above 55% of basketball revenues (Dryer, 2008). In 1998 the CBA developed new ways for successful employer –employee relationship. As a result, all the negotiations between the players were very successful.

MLB Collective Bargaining Agreement

Baseball games started in the first half of the 19th century in the United States and appeared on the professional level in 1866. However, in 1966 the Major League Base Ball Association (MLBA) came into effect to protect the interest of the professional baseball players. Before MLBA, most players could switch teams because of short term contracts (Dryer, 2008). In 1880 the national league decided to implement a reverse rule that protects the players from turning to the other teams after a year of contract completion (Lowell, 1973). In 1885 the powers of the owners of the league were rising rapidly, and the players decided to form the NBPB to reduce their influences. In 1890 the players became so upset by the controls that sportsmen created competing league known as Player League (PL) (Caldwell, 2010). The PL was to struggle with the nation league for revenues and support. The PL made up a greater rivalry, and by the end of 1890 season, the national league owners agreed to provide players with better employment conditions and reprisal. However, the agreement did not change even after the CBA. The players still earned the minimum wage of $2400 per each season, bought their uniforms, and suffered from poor accommodation in hotels and travels.

In 1900, the competitive leagues attempted to convince the players to switch to the league due to the favorable condition of work and treatments. Later in 1914 the sportsmen established another rival league-Federal League due to the poor working condition in the National League. In 1915 the Federal League was disbanded (Dryer, 2008). However, there was no credible union to fight for players rights. Later in 1946, American Baseball Guild (ABG) came into effect due to the contribution by Robert Murphy. The ABG aimed to address the issues that existed since 1886 when baseball become professional. It ended the reserve clause, established salary arbitrations with a minimum wage of $7,500. However, it failed to unified players (Caldwell, 2010).

In 1953 the sportsmen formed the Major League Baseball Player Association (MLBPA) to allow them to have united voice in dealing with employers. In 1968 it resulted in high salaries, pensions, and health insurance benefits. In 1970 there appeared another CBA that granted high salaries. However, the terms were still unsatisfactory which transformed into a strike in 1972. In 1976 a CBA players became free agents through the arbitration process, and the owners could not reserve them for another year of services (Dryer, 2008). Besides, the CBA stipulated that teams would get payment for free agents that signed for others teams. The next CBA came in 1990, where the owners were not allowed to collude with an objective of not signing a free agent, and also stipulated revenue sharing issues or raising the minimum payment from $ 68,000 to $ 100000. In 1994 the owners attempted to establish a cap on salaries, but it was opposed vehemently leading to strikes (Caldwell, 2010). In 1996 another CBA came into effect that raised minimum wages. The deal also came with a luxury tax on teams at a rate of 35% for revenues above $51million in 1997 and 34% in 1999 for revenues exceeding $58.6millions. The next CBA agreement was set in 2002, and later in 2007 it aimed at improving baseball condition.

NFL Collective Bargaining Agreement

The NFL CBAs appeared due to the rise in the powers of owners in the National Football League. In 1956, the players formed the National League Football player Association (NLFPA) to represent their interest (Goplerud III, 1997). The association demanded a minimum pay of $5000, payment plans for injured players as well as uniforms (Dryer, 2008). The National Football League refused to listen to their plea claiming that the association was illegal. In 1960 the players used the newly created American Football Players Association (AMFPA) to demand high salaries from NFL. The claim did not succeed, and in 1966 the two leagues merged further worsening the condition. Later in 1968 the NFL recognized NLFPA but failed to accept the need for the new pension plan. In the same year, new CBA came into effect, and it stipulated that a minimum pay of $9000 for a rookie, $10000 for veterans, and retirement at 65 years.

In 1970 NLFPA combined with AMFPA to negotiate a new CBA that resulted in a minimal rise in salaries of $12,500 for rookies and $13,000 for veterans (Dryer, 2008). It also oriented on the fact that players would have agents and fair arbitration. In 1977 a new CBA stated that the sportsmen would have increased benefits and would have ended the Rozelle rule. In the period between 1977 and 1982 the teams shared the TV revenues (Goplerud III, 1997). In 1982, the players demanded that they would get 55% of the income generated (Caldwell, 2010). The owners rejected the proposal and two months later agreed on a CBA, and the players’ salaries to a total of $1.28 billion but failed to address the stated demand. The NFL succeeded to evade the bargain due to their unity (Goplerud III, 1997). The prosperity of NLF in the agreements was also due to short career plan athletes that allowed them to wait out as players continued with strikes. The advances in the various leagues played a significant role in improving the working condition of players which helped to ensure the increased salaries and respect of fundamental rights. Through the formation of the player’s unions, they could advocate for their rights and communicate their demand with much ease.

Comparison of the NBA, MLB, and NFL

All the three leagues adopted the free agency in the course of their development, they had reserved clause which approved that an athlete played before the agency. It bounded a player to the contractual agreement, and it could mean lifetime commitment (Washutka, 2007). However, MLB maintained it through antitrust exemptions while the others two through collective bargains. In all the three leagues the reserve requirement was eliminated by leaving the free agency system in place (Caldwell, 2010). Besides, in all the three leagues there is stipulated procedure for the former team to keep a free agent.

Among the three leagues only MLB does not have a salary cap instead of the fee limits. Besides, NFL is the only league where the hard salary cap is present (Washutka, 2007). NBA also has a salary cap which is expressed by the percentage of the revenues which a team can use on it players (Caldwell, 2010). In both NFL and MLB there is no clause which allows the team to get compensation when they lose a restricted free agent if he (agent) gets an offer from its previous team and refuses it. Still, in both NFL and NBA the salary cap does not allow a team to win a player just because the League can pay much while in MLB the presence of free agency clause has resulted in the free movement of many stakeholders (Goplerud III, 1997). Furthermore, among the three leagues, NBA has the least revenue sharing plans which depend on luxury taxes. The MLB sharing plan stipulates that team use the shared revenues on their players and the other utilities.

References

Caldwell, T. (2010). An overview and comparative analysis of the collective bargaining agreements in the NBA, NFL, and MLB. CMC Senior Theses. Paper 62. Retrieved on April 7, 2017 from http://scholarship.claremont.edu/cgi/viewcontent.cgi?article=1063&context=cmc_theses

Dryer, R. T. (2008). Beyond the box score: A look at collective bargaining agreements in professional sports and their effect on competition. J. Disp. Resol., 2008(1), 267.

Goplerud III, C. P. (1997). Collective bargaining in the National Football League: A historical and comparative analysis. Vill. Sports & Ent. LJ, 4(1), 13.

Lowell, C. H. (1973). Collective bargaining and the professional team sports industry. Law and Contemporary Problems, 38(1), 3-41.

Parlow, M. J. (2009). The NBA and the great recession: Implications for the upcoming collective bargaining agreement renegotiation. DePaul J. Sports L. & Contemp. Probs., 6(1), 195.

Washutka, D. M. (2007). Collective bargaining agreements in professional sports: The proper forum for establishing performance-enhancing drug testing policies. Pepp. Disp. Resol. LJ, 8(1), 147.

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