Week Two Discussion Block 1

Reply to Rakeem

Rakeem Williams posted Feb 8, 2022 11:19 AM

The Major League Baseball (MLB) labor contract negotiations of 2020 featured lengthy deliberations that resulted in a shortened league of only 60-games. The situation mimicked the 1994 MLB lockout of players when the MLB owners and MLB players disagreed on specific details of the collective bargaining agreement (CBA) at the time. The most recent challenges in 2020 started on March 12 when the league's officials announced a temporary shutdown owing to the COVID-19 pandemic concerns. The halting of the MLB season coincided with the shutdown of NHL and NBA seasons (Baer, 2020). As a result, the league officials had projected that the new 2020 season would be delayed by at least two weeks, which in retrospect was a vast understatement.

Without a definitive schedule because of the pandemic, MLB and the Major League Baseball Players Association (MLBPA) agreed that the players' association would not exchange for assurances regarding service time and salary advances for the players suing the MLB for total salaries in the case of cancellation. The two entities also agreed to operate on prorated salaries when the season shortened. However, the MLB continued to insist on reducing the players' pay suggesting a per-game payment basis if the payers wished to see the season through (Baer, 2020). On the other hand, the players' organization argued against the presented suggestions leading to a standoff. That standoff lasted for the entire part of 2020 until an agreement was reached.

One of the issues that prevailed in the preliminary stages of the standoff was whether the league would continue with its scheduled number of games for the 2020 season. By April, the league had not yet started, and with rising cases of COVID-19, the league officials were hesitant to make any actual plans. MLB had floated many suggestions, such as playing games in an isolated area comparable to the NBA's model of playing in Disney. However, no indication of the sort ever materialized. Anderson et al. (2020) state that both the players' union and the league later agreed that the season, if at all any, would be held in the home stadiums of every team playing in the company without any fans in attendance.

Another major issue that drew sharp reactions from the stakeholders regards the revenue-sharing plan. MLB and, by extension, the owners of the clubs participating in the league earn a lot of revenues from selling television broadcasting rights to the major broadcasters in the country and across the world. In addition, they also make vast sums of money from sponsorships. Therefore, approximately two months after suspending the league, MLB initiated the first steps for reviving the season. It was, however, clear that it would be impossible to manage an entire 164-game season owing to the delays caused by the pandemic. Therefore, MLB proposed an 82-game season that would commence in early July (Baer, 2020).

Nevertheless, the owners of the league and MLB were not ready to pay players the entire sums as agreed in their contracts. As such, MLB had incorporated a contentious revenue-sharing proposal that players disagreed with right from the start. The situation became worse when that proposal leaked to the media before its official release by MLB.

In the proposal, MLB had suggested that players agree to a sliding scale payment plan with payments sliding between 72.5% and 20% of per-game payments (Rogers, 2020). In essence, the players would earn a cumulative salary of 23.9% of their original salaries. Players earning higher wages would experience the biggest pay cut. A majority of people in the industry believed that the proposed plan would result in conflict between the well-paid players and those earning smaller salaries (Baer, 2020). On the other hand, players countered the offer by suggesting a 114-game season with full per-game pay. The players' union indicated that players earn their total prorated salaries, which would amount to 70.4% of the original 2020 players' wages. MLB declined the proposal.

Subsequent proposals by MLB surfaced, and MLBPA countered those proposals with suggestions of their own. There was no agreement between the players and the league. Finally, the league consulted with the owners and issued an ultimatum to players, insisting on a 60-game league with total prorated salaries. Players, however, wanted a 70-game league. MLB stayed put, insisting that the league would only hold 60 games for the 2020 season. The players' representatives voted against that suggestion in a 33-5 vote (Fucillo, 2020). The Chief Operating Officer of MLB imposed a 60-game league and issued a July 1 report date. Players resumed, and the season started on July 23 and ended on September 27.

The interesting bit with this scenario is that, on the one hand, MLB wanted to retain as many profits as possible. By limiting the number of games and convincing players to agree to a work payment formula that would see them earn less money, using the COVID-19 pandemic as an excuse. Although COVID-19 truthfully disrupted MLB operations, the owners saw this as an opportunity to pocket millions of endorsements and television rights payments through a shortened season with fewer games. On the other hand, players believed that the MLB earned a lot of money and, truthfully so and therefore should honor the terms as stipulated in their contractual agreements concerning the payment. Players also wanted to have as many games as possible since their salaries would be prorated.

The negotiations took several months, and even though the situation warranted the extended leave of absence from the sport, both the MLB and the players won. However, the situation favored the MLB more since they got to earn a lot of money with delays and postponed matches and the overall reduced number of games, which meant reduced salaries for the players. Nevertheless, MLB was never close to "busting the union." There were no attempts to sabotage the players' union. Part of the union's responsibility is representing members and pushing for higher wages for the members (Carrell & Heavrin, 2014). Any other approach such as sabotaging the union would have complicated an already tense situation without yielding any benefit in the face of a ravaging pandemic that turned out worse than projected. In the long run, the players union ultimately won the short term, and the owners will make back all the profits in the long run.

References:

Anderson, R. J., Acquavella, K., Snyder, M., Perry, D., & Axisa, M. (2020). MLB 2020 season: Timeline of how testy negotiations led to Rob Manfred mandating a 60-game schedule. CBS Sports Digital. https://www.cbssports.com/mlb/news/batting-around-where-will-carlos-correa-and-trevor-story-sign-when-the-mlb-lockout-ends/

Baer, J. (2020). Timeline: How MLB reached an agreement for a 2020 season after three frustrating months. Yahoo Sports. https://sports.yahoo.com/timeline-on-how-mlb-season-has-been-pushed-to-the-brink-coronavirus-013338726.html

Carrell, M., R. & Heavrin, C. (2014). Introduction to labor relations. In. Carrell, M., R. & Heavrin, C. Labor relations and collective bargaining: Private and public sectors. Pearson.

Fucillo, D. (2020). Report: MLB players reject owners' proposal, league to implement 60-game schedule. Draft Kings Nation. https://dknation.draftkings.com/mlb/2020/6/22/21299770/mlb-season-start-date-2020-length-players-vote-owners-proposal.

Rogers, J. (2020). Fewer games? Salary deferrals? Where MLB players and owners could find middle ground on 2020 season. ESPN. https://www.espn.com/mlb/story/_/id/29252350/fewer-games-salary-deferrals-where-mlb-players-owners-find-middle-ground-2020-season.