THE CBA SPIN CYCLE COMMENCES
Posted by Mike Florio on May 20, 2008, 10:28 a.m.
We heard that NFL Commissioner Roger Goodell was trying to persuade owners not to vote now on opting out early of the Collective Bargaining Agreement because Goodell feared that the move would trigger bad press for the league.
Apparently, the ultimate decision was to move forward — and then to try to control the P.R. regarding the move.
Moments after posting an item about the unanimous decision to pull the plug after the 2010 season, we received by e-mail a press release from the Baltimore Ravens setting forth several management-side talking points.
The release emphasizes the fact that football will continue without interruption for at least three more seasons.
The release also characterizes the uncapped year (2010) as a “season [that] will be played without a salary cap under rules that also limit the free agency rights of the players,” which is an accurate description that many players simply don’t realize.
The release characterizes the issues as follows:
“A collective bargaining agreement has to work for both sides. If the agreement provides inadequate incentives to invest in the future, it will not work for management or labor. And, in the context of a professional sports league, if the agreement does not afford all clubs an opportunity to be competitive, the league can lose its appeal.
“The NFL earns very substantial revenues. But the clubs are obligated by the CBA to spend substantially more than half their revenues — almost $4.5 billion this year alone — on player costs. In addition, as we have explained to the union, the clubs must spend significant and growing amounts on stadium construction, operations and improvements to respond to the interests and demands of our fans. The current labor agreement does not adequately recognize the costs of generating the revenues of which the players receive the largest share; nor does the agreement recognize that those costs have increased substantially — and at an ever increasing rate — in recent years during a difficult economic climate in our country. As a result, under the terms of the current agreement, the clubs’ incentive to invest in the game is threatened.
“There are substantial other elements of the deal that simply are not working. For example, as interpreted by the courts, the current CBA effectively prohibits the clubs from recouping bonuses paid to players who subsequently breach their player contacts or refuse to perform. That is simply irrational and unfair to both fans and players who honor their contracts. Also irrational is that in the current system some rookies are able to secure contracts that pay them more than top proven veterans.”
The last paragraph is the key, in our view. This fight might not be about reducing the 59 cents on the dollar that the players now receive. The goal might be to ensure that the players don’t try to get more — and to reverse the terms from the last CBA that the league overlooked as the owners tried to come up with an acceptable plan for sharing unshared revenues.
And that’s the one issue that the release ignores: The ability of the owners to come up with a long-term solution to the problem of the disparity in total revenues between teams making the most, and teams making the least. The use of a salary cap based on all revenues makes the player costs eat more deeply into the profits of the teams that generate the least revenue.
The supplemental revenue sharing plan apparently isn’t making enough of the owners happy, and it’s a problem that could ultimately cause the owners to fracture.
So even though a possible work stoppage is the thing about which most fans will periodically fret over the next couple of years, the actual worst-case scenario is the splitting of the NFL into two leagues — one with teams that share every penny, and one with teams that follow the “every man for himself” mold.
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OWNERS VOTE 32-0 TO OPT OUT OF CBA
Posted by Mike Florio on May 20, 2008, 10:08 a.m.
What a difference two years make.
In March 2006, thirty of the league’s owners voted in favor of a Collective Bargaining Agreement that gives 59 percent of the total football revenues to the players. Now, all of them have voted to pull the plug on it two years early.
Per Adam Schefter of NFL Network, the owners voted unanimously on Tuesday morning not to extend the CBA through the 2012 season.
Only nine votes were necessary to kill the deal early. Presumably, the unanimous vote is the result of an effort by the owners to project a united front in their negotiations with the union. (We’d heard that Commissioner Roger Goodell was trying to get the owners to defer the decision. So much for that.)
It also makes us think that the owners aren’t yet serious about worst-case scenarios like an uncapped year or a work stoppage. Instead, the 32-0 vote tells us that they see no harm in trying to negotiate a better deal. The worst-case scenario would be agreeing to the same terms that they presently intend to honor for the next three seasons.
Notes from the NFL meeting
May 20, 2008 10:18 AM
Posted by ESPN.com's Pat Yasinskas.
In case you don't understand why owners just opted out of the collective bargaining agreement, here are the numbers behind it.
The league is an $8 billion-a-year business. But $4.5 billion of that (59.25 percent) goes to player costs and owners said they need to make a bigger profit.
In other news, the league just announced that all rookies will visit the Pro Football Hall of Fame as part of their orientation program. The visits will take place from May 28 through June 23. Draftees also will attend the annual rookie symposium in San Diego from June 29 through July 2. The league said the Hall of Fame visits will help rookies understand the league's history and heritage.
Collective bargaining agreement, Pro Football Hall of Fame
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Owner opt out
9:21 AM Tue, May 20, 2008 |
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Albert Breer http://www.***BANNED-URL***/blogs/images/email-icon.jpg E-mail http://www.***BANNED-URL***/blogs/images/email-icon.jpg News tips
The news of the owners opting out of the CBA is breaking across the internet. And while this is significant enough to garner some attention, here are two words of advice: Don't worry.
Truth is, this was a formality. It was going to happen, period. Most people thought it would go down closer to the Nov. 8 deadline to void the labor deal in 2011. This, in fact, is likely a measure by the owners to jumpstart talks.
Now, there are a couple things you should know ...
- This will have little-to-no effect on the 2008 season. Nor should it mess with the '09 season. The first problem would come in 2010, which is now, according to the terms of the opt-out, designated as an uncapped year.
- The players don't want to get to 2010 in the current climate any more than the players do. For one thing, no cap would throw the economics of the league out of whack. And while it could mean teams like Washington or Dallas, flush with cash could open vaults (though that doesn't jive with Jerry's history), it also would also likely allow the smaller-market team to curb their spending. Plus, under the terms of the agreement, free agency rules would change, most notably keeping players from getting unrestricted status until after their sixth year, rather than their fourth.
I have to think the sides will get this done. Things were pretty dire in 2006, or seemed that way, and the union and owners worked things out. They've got plenty of time to do it now. If you want more on this, here are the thoughts of
Jerry Jones and
Gene Upshaw on the topic from the combine.
