MLB Labor Dispute: Potential Legal Fallout and What It Means for Baseball
1. What’s the Dispute About?
At its root, the debate between Major League Baseball and the Major League Baseball Players Association is about money and who gets it.
The Major League Baseball (MLB) believes that cost limitations are necessary in order to close the significant gap that exists between clubs who spend enormous sums of money on payroll and those that spend very little. As of this year, the player payroll for the New York Mets is estimated to be $328 million, whereas the player payroll for the Cleveland Guardians is estimated to be $80 million. According to reports, Major League Baseball has proposed a wage floor of $171 million and a salary cap of $245 million. Other professional sports leagues have salary caps and maximum salaries, which are portrayed as helping to promote fair play and level the playing field. These salary caps and maximum incomes are also known as pay caps.
restrictions on the duration of player contracts are another policy that Major League Baseball is looking to implement. These restrictions would prevent player contracts from being longer than five years (for a player joining a new team) or six years (for a player staying with his team). In addition, the league suggested that the minimum pay for Major League Baseball (MLB) players should be raised from $780,000 to $1 million, and that players should be at least 20 years old and have graduated from high school at least two years prior to signing contracts with Major League Baseball teams.
The union maintains that these and other requests would be detrimental to the sport, stating that Major League Baseball is attempting to “eliminate fundamental rights with a salary cap” and “destroy the amateur entry process.” “Reduce player compensation by billions of dollars” is another concern of the union. To continue along these lines, the Major League Baseball Players Association (MLBPA) asserts that a cap system would “eliminate the free market” as part of an effort to reduce player compensation and increase the revenues of teams and owners.
2. How Can a Lockout Be Legal?
In the event that they are in support of a reasonable bargaining stance, lockouts are legal, despite the fact that they may appear to be unjust to players at first glance.
The act of an employer refusing to permit employees to work and, as a result, to be paid is known as a lockout. It is designed to exert pressure on union members in order to get them to comply with the demands of management. The Major League Baseball players will be “locked out” of showing up at spring training facilities and ballparks in order to fulfill their employment contracts from that point forward. Players’ associations typically establish a lockout fund in order to assist in mitigating the financial impact of a work stoppage. This fund is used to pay players a percentage of their wage during the lockout.
MLB is looking to make adjustments to the economic connection it has with the union. According to a decision made by the Supreme Court of the United States, lockouts are legal on the condition that they bring “economic pressure to bear in support of” a “legitimate economic position.”
In the event that lockouts interfere with the rights of workers to engage in collective bargaining, they may be considered unfair labor practices and even an unlawful matter.
The Major League Baseball (MLB) locked out players on December 1, 2021, despite the fact that it did not get as much notice as the current issue. Over the course of three months and eight days, the lockout existed. Despite the fact that it resulted in a truncated spring training and a delayed opening day, the whole 162-game schedule was played nonetheless. This century has had lockouts for the National Football League, the National Basketball Association, and the National Hockey League.
3. Does a Lockout Have to Happen on Dec. 1?
No.
Just like a strike, a lockout is a choice that can be made.
Expiration of a collective bargaining agreement (CBA) does not affect many provisions, notably those that govern pay and medical benefits. As a matter of fact, they might persist for a considerable amount of time during what is known as the “status quo period.” A league is not permitted to unilaterally impose new regulations for salaries, hours, and other working conditions during this period, which is stipulated by labor law and the National Labor Relations Board. At this time, the league is prohibited from doing so.
I was involved in a labor-management conflict while I was working in the legal field, and the status quo era continued for a number of years during that time. Normative operations were carried out. At least in the realm of sports, it is not unusual for a collective bargaining agreement (CBA) to run its course and for not much to change until a new CBA is established.
Even in professional sports, leagues and players’ groups have conducted their operations in the same manner for many years. The United States Soccer Association and the United States Men’s National Soccer Team went through a period of years (2018 to 2022) before reaching an agreement on a new collective bargaining agreement (CBA). During that span, the squad continued to play games and function as they normally would.
The status quo will remain in place until either a new CBA is reached or the parties achieve a stalemate after engaging in bargaining in good faith.
4. Could MLB and the MLBPA Operate in Status Quo?
Indeed, but you shouldn’t count on that happening.
MLB wants to make significant changes to the economics of baseball, such as imposing a pay cap, allowing players to sign maximum contracts, and other aspects that the MLBPA is opposed to. MLB does not wish to maintain the parameters of a present collective bargaining agreement, also known as the status quo. Having said that, Major League Baseball may choose to postpone a lockout if the two parties are close to reaching an agreement as the date of December 1 draws near.
5. How Discouraging Is It That the Sides Appear Far Apart?
The fact that Major League Baseball is looking for significant changes and that the Major League Baseball Players Association seems to be adamantly opposed to them is not a positive omen; nonetheless, it is important to keep in mind that there is a significant amount of time between now and December 1.
Both the league and the union are engaged in a struggle to influence public opinion. The league is arguing that the reforms it is seeking would make Major League Baseball more comparable to other major professional leagues, while the players are arguing that the owners are already wealthy and just want more money. Noise and hyperbole make up a significant portion of that conversation, which includes the information that will be presented as news in the media stories about the negotiations. After engaging in negotiations behind closed doors, away from the scrutiny of journalists and influential individuals, the two parties will eventually come to an agreement that both parties can accept.
Consider the recent labor dispute that occurred between the Women’s National Basketball Association (WNBA) and the Women’s National Basketball Players Association (WNBPA) in the previous year. In addition to being exceedingly PR-conscious, the two sides appeared to be very far apart. The disagreement lasted for several months, but they were able to come to an agreement without losing any games.
6. Could MLB Teams Lay Off Scouts and Other Personnel?
Whether or not there is a lockout, Major League Baseball teams always have the ability to make decisions on staffing. There is a possibility that a lockout may eventually result in a prolonged halt of business activities, which may cause teams to lower the compensation of their employees, lay off people, or put them on furlough. While the COVID-19 pandemic was going on, Major League Baseball teams engaged in all of those practices that reduced employment.
But there were significant ways in which the epidemic was distinct from a labor conflict. In the months and years that followed the pandemic, there was no way to know with absolute confidence when it would end or how the sports world would function going forward. In the case of a labor dispute, this is not the case because it has the potential to cease at any moment and immediately return to normal business operations. It is possible that it would not be a prudent decision to eliminate front office jobs that would need to be filled again, as this would mean severing links with staff who have years of experience and are highly talented.
7. Could Congress or the President Force MLB to End the Lockout?
No.
A private sports league cannot be compelled to resolve a disagreement with its unionized players because neither Congress nor the president possesses the authority to do so under federal law, the Constitution of the United States of America, or case precedent.
Air traffic controllers are not being terminated on this occasion by President Ronald Reagan. It is also not the National Labor Relations Board (NLRB) that is suing Boeing over its plans to move a facility from Washington to South Carolina while President Barack Obama is in office.
In this particular instance, a sports league and its players are engaged in a labor dispute. After the league and the players have come up with a solution, it will come to an end.
8. Could Congress or the President Pressure the Sides to Reach a Deal?
Certainly, and it is highly likely that this will occur to some degree.
Baseball has a long and illustrious history in our nation, the majority of clubs have stadiums that are subsidized by taxpayers, and a large number of jobs, including those that are employed at restaurants and bars located in close proximity to ballparks, could be forfeited if games are not played in 2027. Some members of Congress and the people they represent would be aggravated by the possibility of a season that was not successful.
In addition, Congress has demonstrated a propensity for intervening in sports issues; for example, take into consideration the amount of airtime that members of Congress receive when they preach about the current situation of collegiate athletics. The fact that the sports and news organizations will cover whatever they say is something that they are undoubtedly aware of.
Nevertheless, there is a possibility that Congress will intervene in a disagreement involving a private sports league that involves rich owners and millionaire sportsmen. The average wage of a Major League Baseball player is $5.34 million over the course of their career. Workers in the steel industry, employees in assembly lines at automobile factories, and teachers are not involved in this labor dispute. The sport of baseball is a form of amusement that, despite its widespread popularity, is not indispensable to the economy.
This concern appears to be especially pertinent at a time when many ordinary Americans are confronted with real-world issues such as rising prices for groceries and petrol, as well as growing expenditures for housing and education.
9. What Could Congress Actually Do?
Those who hold the big card in Congress are threatening Major League Baseball with the possibility of rescinding the remaining portion of MLB’s antitrust exemption. I am very familiar with this playbook.
It was in the case of Federal Baseball Club v. National League (1922) that the Supreme Court of the United States decided that professional baseball is not subject to antitrust scrutiny. The decision has been challenged for a long time for being inconsistent with fundamental understandings of the law. Subsequently, the court declined to extend the exception to other sports, such as boxing, basketball, and football.
After a number of decades had passed, a baseball player named Curt Flood tried to challenge the exemption. However, in 1972, the Supreme Court sustained the exception by using the principle of stare decisis. This expression relates to the concept that the court is required to follow precedent, and precedent from 1922 must be followed to the letter, even if it might be argued that it is incorrect. In addition, the court stated that the legislative process might be utilized by both Congress and the president in order to either eliminate or restrict the scope of the exemption.
The Curt Flood Act was finally enacted into law by President Bill Clinton after it was passed by Congress and signed into law by the president. The act reduced the scope of the antitrust exemption accorded to Major League Baseball, most notably by removing the protection’s application to the employment of Major League Baseball players. A number of other subjects, such as minor league baseball, the amateur draft, club relocation, and ownership sales, continue to be exempt from the exemption. Due to the fact that owners cannot threaten a league with an antitrust lawsuit to relocate, Major League Baseball has contended that the exemption has been beneficial to fans.
The remaining portion of the exemption could be repealed by the introduction of legislation by Congress. Congress could utilize this threat to encourage Major League Baseball to reach an agreement with the Major League Baseball Players Association (MLBP). It is unknown whether there would be sufficient political backing.
On the other hand, the antitrust exemption does not play a significant role throughout the majority of the situation. Because of the Curt Flood Act, the exemption is no longer applicable to the employment of Major League Baseball players, which is the subject of the lockout.
10. Could MLB Challenge the MLBPA in the Legal System?
The answer is yes, and there is a playbook for it.
The NFL filed an unfair labor practice charge (ULP) with the National Labor Relations Board (NLRB) in February 2011, one month before the Collective Bargaining Agreement (CBA) of the NFL would expire and the NFL would lock out players. The National Football League asserted that the union was not bargaining legitimately.
In a similar manner, the National Basketball Association (NBA) filed a ULP with the National Labor Relations Board (NLRB) against the National Basketball Players Association (NBPA). To make it easier for players to file lawsuits under antitrust law, the National Basketball Association (NBA) presented the National Basketball Players Association (NBPA) disclaiming interest as a hoax. The National Basketball Association (NBA) filed a separate lawsuit against the National Basketball Players Association (NBPA) in the Southern District of New York.
Over the course of several months, the National Labor Relations Board (NLRB) conducts an investigation into ULP charges. At the end of the process, the NLRB offers a recommendation to a regional director, whose decision is then reviewed by the NLRB. The National Labor Relations Board (NLRB) has the ability to file a complaint and ask a federal judge for an injunction.
In the aim of increasing advantage for its negotiations with players, Major League Baseball (MLB) may adopt a similar technique (and the Major League Baseball Players Association could do the same). However, in the end, these actions would most certainly be slow moving and would not resolve the core conflict.
11. Could MLB Impose Terms Like a Salary Cap Without Union Consent?
This tactic was attempted by Major League Baseball during the players’ strike in 1994-1995, but it was rejected by a federal judge. (More on that will be discussed in Part II.) However, Major League Baseball may declare a standstill, which would indicate that it believes it has given its best and final offer to the union. MLB might then attempt to impose the stipulations that were included in that offer. On the other hand, the MLBPA would present a ULP case against Major League Baseball and insist that the union and league are engaging in bargaining in good faith.
12. Can Mediation Get the Two Sides Talking?
Indeed.
The Federal Mediation and Conciliation Service (FMCS), which is a federal agency that is impartial, has been utilized by leagues and players’ associations in an effort to resolve labor issues in the past. In the process of FMCS, both parties involved in a dispute present their reasons to a mediator, who then suggests a settlement to the conflict. Since the suggestion is merely a recommendation to the two parties, it does not carry any legal weight.
The league made a request to the union in 2022 to use FMCS, but the Major League Baseball (MLB) stated that the MLBPA had declined the request. FMCS was utilized by both parties during the lockout that occurred in the National Hockey League in 2012–2013. The recommendations made by mediator Scot Beckenbaugh were believed to assist the NHL and NHLPA in finding a solution.
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