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A History of Players' Unions in American Sport

This document provides a history of players' unions in American professional sports. It discusses how professional baseball developed earlier in the US than other countries, establishing the reserve clause system that bound players to teams. While early unionization attempts failed, the precedent set in Federal Baseball Club v. National League exempted baseball from antitrust law, influencing labor relations. In the 1960s-70s, unions strengthened as Marvin Miller led the MLB players' association in gaining concessions and supporting Curt Flood's challenge to the reserve clause.

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0% found this document useful (0 votes)
123 views17 pages

A History of Players' Unions in American Sport

This document provides a history of players' unions in American professional sports. It discusses how professional baseball developed earlier in the US than other countries, establishing the reserve clause system that bound players to teams. While early unionization attempts failed, the precedent set in Federal Baseball Club v. National League exempted baseball from antitrust law, influencing labor relations. In the 1960s-70s, unions strengthened as Marvin Miller led the MLB players' association in gaining concessions and supporting Curt Flood's challenge to the reserve clause.

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A History of Players' Unions in American Sport

Introduction

Throughout 2011, one of the most important issues to most American sports fans was the issue of organized labor and collective bargaining. The lockouts of the NBA and NFL brought fans from the world of touchdowns and free throws and thrust them into the world of collective bargaining and anti-trust litigation. These kind of labor disputes have been relatively common throughout the last forty years: the NFL, NBA, MLB, and NHL have all experienced significant labor disputes, and each league has experienced the cancellation of games due to these disputes. Since the dawn of sports collective bargaining in the 1960s, 21 work stoppages strikes or lockouts among these four sports alone (LeRoy, 2011). While labor dispute are certainly not unheard of in pre 1960s-times, or in other nations of the world, the existence of strong labor unions willing to take strong stances against management seems to be much more prevalent in post-60s America than at any other time or place in modern sporting history. What factors, then, led to the relative strength and audacity of sports labor movements in America? What historical, legal, and cultural factors so differentiated America from places such as Europe, where sports unions are weak or nonexistent? To find the answers, the history of professional sport within America must be examined, from the origins and foundations of the major sports within America, to the coalescing of these four major leagues of sport and codification of their labor practices, to the formation and strengthening of players' unions. I argue that the importance of unionization in American sport arose as a consequence of the early development and institutionalization of professional sport, especially professional baseball in

America, as compared to other countries. As such, business law was less refined as it was today, leaving judges to make precedents that would not be consistent with current interpretations with the law, but which still held legal power throughout history and through to today. Therefore, baseball was pressured into pursuing a strong union and collective bargaining strategies to meet their players' demands. Other sports Football, Hockey, and Basketball had access to legal avenues of antitrust legislation that baseball did not, which shaped the histories of those games in their own unique ways.

The beginnings of Baseball and the Reserve Clause

Professionalization of sport in America came easier than in Great Britain. Baseball, especially, came into professionalism easily. Baseball began as a children's game, and then progressed to upper-class gentlemen forming clubs like those seen in Britain to play the game amateurly. However, growing classes of immigrants also learned the game, seeing it as uniquely American and a way to integrate into society (Gorn & Goldstein, 2004). Unlike in Britain, where the lower classes who relied on professionalism to earn their wages were separated from the upper classes, in America the upper and upper-middle classes embraced professionalism as a way to earn money for themselves, through team ownership. Thus, professional teams formed as early as 1869, and by 1876 the National League of Professional Base Ball Clubs the precursor to today's National League and, thus, to Major League Baseball was formed. The National League set important precedent as to how baseball players would be paid. In the name of competitive balance and not giving wealthy teams advantages over less-wealthy teams, the reserve clause was established in 1879. The reserve clause, in effect, allowed for

teams to have exclusive rights to a player in perpetuity, and only the team could sell or trade or release thee rights. Players were bound to teams for life, unless the team saw value in letting them go. This, among other measures instated by the league, allowed them to keep player salaries low. This sparked the first organized labor action against major professional baseball, as many players from the National League successfully went on strike, forming a rival Players' League. However, the superior wealth of National League owners successfully competed out the Players' League, and soon the National League and new rival American League stood as the two most powerful professional baseball leagues in the country. Failing in their first bid at organized labor, the players were forced into these leagues. However, viable competitors to the National League especially the American League began to flourish, offering hope for players to receive better deals as leagues would ignore the reserve clauses of other leagues. For a time, the validity of these reserve clauses would be struck down by courts (Philadelphia Baseball Club v. Hallman) or found to be enforceable only within the same state (Philadelphia Baseball Club v. Lajoie). However, the landmark case of Federal Base Ball Club v. National League of Professional Base Ball Clubs, which set ruled that baseball did not constitute interstate commerce (since diamonds, after all, were located entirely in one state), and as such baseball was given a full anti-trust exemption, including explicit judicial acceptance of the reserve clause (LeRoy, 2011). Despite presenting a glaring contradiction with regards to the normal judicial definition of interstate commerce, this precedent has withheld challenges on many occasions and to this day takes an important role in baseball labor law. In contrast to the early professionalization of baseball, (American) football and basketball, especially in their formative days, were sports primarily played on an amateur level according to Victorian muscular Christianity ethos. Indeed, this historical trend can still be

seen immense popularity of football and basketball in colleges, marking its origins as an amateur game that was originally played in upper-class collegiate institutions such as Harvard or Yale. Basketball was similarly promoted by organizations such as the YMCA, organizing and explicitly amateur and Christian game that extolled virtues of sound body and sound mind. The success of professional baseball in America, however, showed that professional sports were a viable form of entertainment and profit in American culture. As such, football and basketball, as well as the Canadian game of ice hockey, established professional leagues that thrived in America. Following the example of baseball, all of them, in one form or another, employed the idea of a reserve clause. However, it bears noting that none of these sports had a decision so important as Federal Baseball Club that gave it a full anti-trust exemption. As such, baseball often led the way in terms of labor relations and utilization, both because it had persisted longer as a professional sport, and because unionization and collective bargaining was seen as the only way to influence labor relations, due to the courts being closed off in large part by the Federal Baseball Club decision.

Unionization and the rise of Marvin Miller

People were beginning to see, however, that the reserve clause unduly limited the economic rights of players. As early as 1940 (Zollman, 1940) legal scholars were beginning to see that the reserve clause was extremely inhibiting to players and stood on shaky legal ground, and many came to the conclusion that the reserve clause had a strong effect in keeping players salaries artificially low (Rottenburg, 1956). Despite this, the Federal Baseball Club ruling was upheld in case after case throughout the 40's, 50's, and 60's. This was in spite of the fact that

baseball was expanding its revenue streams by branching out into television, and radio, which allowed games to be broadcast nationwide - and for teams to obtain lucrative broadcasting fees (Jay, 2004). This obviously strained the already tenuous definition of baseball as not constituting interstate commerce nevertheless, the ruling stood time after time. Thus, legal challenges to the reserve clause and, indeed, to other aspects of professional baseball were mostly closed to the players. This made unionization and collective bargaining became the most attractive option for the players to gain concessions. However, while baseball unions did exist through this period, they were seen as being house unions that were merely puppets of ownership interests (Korr, 2002). The Major League baseball Players' Association, or MLBPA, founded in 1953, was seen as just another example of a union that was subservient to owners and thus doomed to be ineffectual. The MLBPA, however, broke this pattern in 1966, when it hired Marvin Miller to be its executive director. Miller was the farthest thing from a puppet of the owners he was, instead, a well-educated labor economist, has left a lucrative and successful career as one of the heads of the United Steelworkers union to become the MLBPA's director. Miller began claiming numerous concessions from the owners in 1968, the minimum salary was raised from $7,000 to $10,000, and from 1963 to 1969 average player salaries increased from $19,160 to $249090 (Jay, 2004). 1968 also saw the adoption of baseball's first collective bargaining agreement It was in 1969, however, that Miller began to show his true willingness to take the fight to the owners. St. Louis Cardinals star Curt Flood had been traded to the Philadelphia Phillies, but refused to report, citing the racial hostility of the fans, as well as the unfairness of the reserve clause. Flood, an African-American, made controversial comments likening the reserve clause to slavery and himself to a well-paid slave (Khan, 2010),. In a letter to commissioner of baseball

Bowie Kuhn, Flood further stated: I do not feel I am a piece of property to be bought and sold irrespective of my wishes. I believe that any system which produces that result violates my basic rights as a citizen and is inconsistent with the laws of the United States and of the sovereign States. Miller enthusiastically supported Flood in his fight against the reserve clause, and the MLBPA funded Flood's legal case until it reached the US Supreme Court. In a 5-3 decision, however, the Supreme Court once again upheld the Federal Baseball Club precedent, in perhaps the most contradictory and farcical manner yet. Justice Harry Blackmun wrote the majority opinion, in which he explicitly acknowledged that baseball constituted a form of interstate commerce, that the Federal Baseball Club ruling was an aberration, and that other professional sports were not at all subject to the same antitrust regulations that baseball was, for no other reason than the Federal Baseball Club precedent. Despite this, however, Justice Blackmun - as well as Justices Rehnquist, Burger, Stewart, and White - upheld the Federal Baseball Club precedent and ruled in favor of commissioner Kuhn. Justice Blackmun's opinion is also notable for its opening section, entitled The Game, in which Blackmun decided to spend around seven pages writing a adulator history of the game of baseball, very flowery and reverential to the idealistic conceptualization of the national pastime, which concluded in a nearly page-long listing of various great players throughout baseball's early history, and references in the footnotes to famous works of poetry on baseball. Though Flood v. Kuhn once again upheld the antitrust exemption, its importance lies tin the fact that it demonstrated, perhaps for the last time, that if significant strides were to be made in professional baseball labor reform, it would not be accomplished through the court system. Thus, in 1972, Mavin Miller and the MLBPA organized the first organized, MLB-wide strike.

Major league games were canceled, and Owners eventually gave in to the MLBPA's demands for increased pension funding (Scully, 1974). The league was also forced in 1972 to institute the so called Flood rule, named for Curt Flood, which gave veteran players the right to refuse trades under certain circumstances. Another work stoppage and the threat of missing games led to more concessions in 1973, when the concept of salary arbitration entered into baseball for the first time (Faurot and McAllister, 1992). The arbitration process injected an independent arbitrator into the process of salary negotiation, negotiating a fair price between the demands of the player and ownership. Arbitration was one of the first instances in which the salary of players could be affected by an entity other than ownership, putting more economic fairness into the salary system. Despite these victories, however, the reserve rule still remained to be conquered. Miller and the MLBPA, however, had a plan. Miller encouraged two players, Andy Messersmith and Dave McNally, to not sign contracts for the 1975 season. Without contracts, the only thing binding them to their teams was the reserve clause, which locked the players into a series of oneyear contracts with their teams that would renew themselves in perpetuity. After playing the 1975 year without a contract and only tied to a team under the reserve clause, Messersmith and McNally took a grievance to the arbitration system established in the 1973 collective bargaining agreement notably, not the court system that had time and time again upheld the reserve clause. Arbitrator Peter Seitz ruled in favor of Messersmith and McNally, ruling that the reserve clause only bound players to teams for one additional option year, and thus Messersmith and McNally were free agents able to sign wherever they liked. The reserve clause was finally abolished. In 1976, a new collective bargaining agreement was signed stipulating that players were eligible for complete free agency after six years of major

league service time with their teams. The six years of service time was not simply a union concession to the owners, but also a tactical decision by Miller, who feared that having too many free agents at the same time with only a limited amount of teams to bid for them would lead to depressed salaries (Conti, 1998). Salaries immediately ballooned, under the effects of arbitration and free agency. The average player salary in 1972, before the arbitration system, was $34,092 (Haupert. 2003). By 1976, under the auspices of salary arbitration, average salary increased to $52,300. Free agency, however, grew the average salary at an unprecedented rate, and by 1979 the average salary figure had reached $121,900, only continuing to grow from there.

Other Sports Antitrust Law and the rise of Free Agency

Football, basketball, and hockey were not bound by the same antitrust exemptions that baseball were. Court cases in the history of these sports, including Radovich v. National Football League (1957), Philadelphia World Hockey Club v. Philadelphia Hockey Club (1972) and Robertson v. National Basketball Association (1975) showed that all of these sports were fully regulatable under antitrust law, due to the lack of a Federal Baseball Club-esque precedent that specifically called for an exemption. Thus, antitrust law is an important part of labor negotiations in these sport indeed, the 2011 NFL and NBA lockouts both resulted in antitrust cases being filed (Brady v. National Football League, 2011) (Anthony v. National Basketball Association, 2011). However, the success of Miller's MLBPA encouraged collective bargaining and the threat of work stoppages as a method of achieving the players' objectives. In 1968, the NFLPA set out to negotiate its first collective bargaining agreement with the NFL. This led to the NFL's first

work stoppage, which ended quickly as the owners made some minor concessions in regards to raising salary (Lomax, 2004). Another short work stoppage in 1970 led to more minor concessions, which led to player dissatisfaction with the union. In 1971, the NFLPA appointed Ed Garvey as its Executive director, and in 1974 another strike was called. This time, the union let it be known that they were out to eliminate the option clause a provision that bound players to teams past their nominal contracts, though not renewed in perpetuity like the baseball reserve clause and the Roselle rule, named for NFL commissioner Pete Roselle, in which teams must give compensation to a player's former team when they are signed as a free agent. Both of these rules, though not as definitive as baseball's reserve clause, severely restricted player movement and, as such, lowered player salaries in much the same way. However, the 1974 strike ended without the signing of a new collective bargaining agreement, precisely because the players had the option of pursuing antitrust litigation against the league. Sure enough, Mackey v. NFL (1976) ruled the Roselle rule as an anti-trust violation, thus giving the players another victory. This continued pattern of the players leveraging both the threat of anti-trust litigation as well as work stoppages to achieve their goals. Strikes occurred again in 1982 and 1987, both of which caused games to be canceled and part of the 1987 season to be played with replacement players. However, these work stoppages were supplemented by antitrust lawsuits such as Powell v. NFL (1989) and McNeil v. NFL (1992) that also gained the players more rights. In 1993, the threat of another lawsuit, White v. NFL, caused the NFL and NFLPA to work out a new collective bargaining agreement they had been playing without one again since the 1987 strike that finally removed many of the restrictions and ushered in an era of NFL free agency, in return for the players acquiescing to owners' demands of a salary cap (Bell, 2011).

In contrast to both the NFL and MLB, the NBA did not suffer any major labor disputes on its way to abolishing the reserve clause and establish free agency. Instead, much like the NBA, anti-trust legislation was the main tactic used. When the NBA and rival ABA were planning their merger in 1970, NBAPA president Oscar Robertson filed an antitrust suit on the grounds that such a merger would greatly diminish the competitive for player salaries, thus creating an antitrust violation. The NBA and NBAPA settled the lawsuit with an agreement that very much resembled a collective bargaining agreement, which abolished the NBA's reserve clause and gave greater free agency rights to players with regards to drafts and free agency compensation (LeRoy, 2011). The NHL, too, owed much of its reform of free agency to anti-trust litigation, instead of collective bargaining. However, the formation of the union did indirectly play an important role in abolishing hockey's reserve clause. In Philadelphia World Hockey Club v. Philadelphia Hockey Club (1972), the courts ruled the reserve clause an anti-trust violation, in large part on the grounds that the reserve clause was negotiated before the NHLPA actually existed, did not represent the result of collective bargaining, and therefore fell within the jurisdiction of the courts to overrule.

Modern Sports Labor Disputes existential threats?

The abolishment of the reserve clause from these four leagues did not, however, bring an end to labor disputes. Indeed, the past 20 years have seen labor disputes in multiple sports that canceled or threatened to cancel seasons, post-seasons, or even threaten the very existence of the leagues themselves. With the end of the reserve clause and relative opening of free agency came

even more disputes about the allocation of revenue between owners and players, and whether the further restrictions to free agency in some sports are still necessary parts of keeping a competitive league, or old vestiges of the reserve clause that unfairly and illegally limit player freedom. While the labor disputes of the 1970s and 1980s resulted in the players gaining many concessions, to some extent it seems like recent times that owners have been able to extract more from the players in these debates. This relative increase in owner leverage has also led to longer strikes and lockouts where hope of finding cooperation seems less and less likely. One of the most memorable and devastating labor disputes in recent sporting history was the 1994-1995 Major League Baseball strike. While previous strikes had canceled games before, the 1994 strike cut short the 1994 season and forced the cancellation of the entire playoffs, including the World Series. This proved to be devastating to the popularity and economics of baseball in the short term (Staudohar, 1997), creating a depression that would take years and, some would argue, steroids-induced home run frenzies to recover from. Significantly, however, the new collective bargaining agreement signed in 1997 in large part consisted of player concessions to the owners, including the institution of a luxury tax that limited the spending of the richest teams. This trend towards longer, more divisive labor disputes continued with the 1998-99 NBA lockout. The lockout threatened the cancellation of the season, and ultimately limited the season to only 50 games. Significantly, again, the lockout was widely viewed as a win for NBA ownership (Taylor, 1999) with ownership receiving many concessions including the institution of a maximum individual salary, less exceptions to the salary cap rules, and longer team control over their draft choices. The agreements in these cases both seem to mark that the pendulum is

swinging the other way in regards to who holds the power in these negotiations. The NHL suffered an even harsher fate than the MLB and NBA, however. The 2004-2005 NHL lockout forced the cancellation of the entire season and post-season, stretching a total of 308 days. The unwillingness of the players to concede early, however, did not seem to produce greater fortunes for NHL players than it did for MLB and NFL players, as the owners again received their chief demand the acceptance of a salary cap in the NHL. NHLPA head Bob Goodenow resigned shortly after the conclusion of the lockout his hardline stance against a salary cap was seen as the key factor holding up negotiations for so long, and he clearly failed to prevent a salary cap from being instituted. Once more, the owners win the discussion.

Conclusions: 2011 and Beyond

Once again, lockouts threatened the seasons of two major sports leagues the NBA and NFL in 2011. And, once again, these disputes resulted in outcomes that most observers say are favorable to owners especially in the case of the NBA lockout (Yglesias, 2011). Major League Baseball, perhaps still shaken from the spectre of the 1994 strike, signed its own collective bargaining agreement in 2011 without labor disputes, and while details on the new agreement are still scarce and open to interpretation, it seems obvious that players have not reversed the trend of the owners being the prime beneficiaries of recent collective bargaining agreements. There are many possible reasons why collective bargaining, which at its inception so radically favored players at every turn, now seems to have slowed or reversed that progress, and swung back around to giving more power to the owners. One of the paramount reasons, especially in the non-baseball sports, is that anti-trust legislation seems like a less effective tactic

than before. The most egregiously illegal elements of the old league rules = the reserve and option clauses have been heavily mostly eliminated, with free agency for the most part achieved and player salaries at astronomically high level compared to before collective bargaining. While anti-trust legislation was still filed during both the NFL and NBA lockouts, it seems now that it acted more as a bargaining tactics than as a true attempt to seek judicial reform of the process. While using antitrust legislation as a bargaining chip has worked before see the aforementioned settlement of the Robinson case in the NBA this time it seems that the threat is seen as less credible, either owing to the fact that owners don't except antitrust legislation to result in any significant changes, or that players unions would not have the wherewithal to last through a long lawsuit. This also ties into the fact that the owners of these teams are generally much, much more wealthy than the players, and less reliant on the continued operation of the league for their income thus the owners have comparatively less from dragging out a labor dispute and hoping the players will cave to their demands. This does not, however, explain the swing back to the owners in Baseball, especially seen in the resolution to the 1994 strike. I would argue that antitrust legislation is still extremely important in the players being able to secure leverage during labor disputes the fact that baseball was able to achieve such reforms while having the road of antitrust legislation completely closed off to them is somewhat anomalous. The strides made by the MLBPA owe themselves in large part to the personal dedication and acumen of Marvin Miller, and of the inexperience of baseball ownership in dealing with unionized labor. As such, it seems possible that, in the future, baseball collective bargaining agreements will continue to cede more and more power back to ownership, unless Federal Baseball Club and the antitrust exemption are overturned by legislative or judicial action. If players unions in hockey, basketball, and football

are not active and serious in the pursuit of antitrust legislation, or if there really is to be little serious legal ground for more of these suits to stand on, then they too may continue to lose power. On the whole, unionization has radically changed the way in which American professional sport. Players receive more economic benefits from their current situation than before the rise of players' unions. While antitrust law has shown to be key in players reforming professional sports systems to their benefit, it is somewhat ironic that the concept of a strong, active players union originated is baseball the one American sport that is explicitly exempt from antitrust law. It remains to be seen what the future holds for with regards to collective bargaining in American sport are recent trends indicative of a large-scale movement of power back into the hands of ownership after the ascendancy of players unions in the 70's, or have we reached some point of near-equilibrium where owners and players can create a successful, mutually beneficial financial agreement? It seems that we will have more opportunity to answer these sorts of questions, as the NHL collective bargaining agreement expires at the end of this current season.

References Bell, J. (2011, Mar 12). Timeline of nfl labor disputes. Retrieved from http://www.usatoday.com/sports/football/nfl/2011-03-03-nfl-labor-disputestimeline_N.htm Conti, J. (1998). Effect of salary arbitration on major league baseball. The Sports Lawyers Journal, 5, 221-248. Faurot, D., & McAllister, S. (1992). Salary arbitration and pre-arbitration negotiation in major league baseball .Industrial and Labor Relations Review, 45(4), 697-710. Flood v. Kuhn, 407 U.S. 258, (1972) Flood, C. (1969, Dec 24). Curt flood's letter to bowie kuhn. Retrieved from ttp://mlb.mlb.com/news/article.jsp? md=20070315&content_id=1844945&vkey=news_mlb&fext=.jsp&c_id=mlb Gorn, E., & Goldstein, W. (2004). A brief history of american sports, ed. Eric Foner. Hill and Wang. Haupert, M. (2003). The economic history of major league baseball. Retrieved from http://eh.net/encyclopedia/article/haupert.mlb Jay, K. (2004). More than just a game: Sports in american life since 1945. Columbia University Press. Korr, C. (2002). The end of baseball as we knew it: The players union, 1960-81. University of Illinois Press. Khan, A. (2010). Baseball in the black public sphere: Curt flood and the disappearance of race. Retrieved from http://conservancy.umn.edu/bitstream/98800/1/Khan_umn_0130E_11398.pdf

Lomax, M. (2004). The quest for freedom: The nflpa's attempt to abolish the nfl's reserve system. Football Studies, 7, 70-107. LeRoy, M. (2011). The narcotic effect of antitrust law in professional sports: How the sherman act subverts collective bargaining. http://papers.ssrn.com/sol3/papers.cfm? abstract_id=1933917 Rottenburg, S. (1956). The baseball players' labor market. Journal of Political Economy, 64(3), 242-258. Scully, G. (1974). Pay and performance in major league baseball. The American Economic Review , 64(6), 915-930. Staudohar, P. (1997). The baseball strike of 1994-95.Monthly Labor Review, 120, 21-27. Taylor, P. (1999, Jan 18). To the victor belongs the spoils.Sports Illustrated, Retrieved from http://sportsillustrated.cnn.com/vault/article/magazine/MAG1014974/index.htm Yglesias, M. (2011, Nov 26). How the owners won the nba lockout. www.slate.com/blogs/moneybox/2011/11/26/ how_the_owners_won_the_nba_lockout.html Zollman, C. (1940). Baseball peonage. The Marquette Law Review, 24, 139-145.

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