This past week has been an eventful one in terms of professional sports and labor talks. But while Major League Baseball avoided heated conflict, the National Basketball Association succumbed to it.
Extended Labor Peace for MLB
The Major League Baseball Players’ Association and the league’s owners are on the verge of reaching a new labor deal. Official announcement of the new Collective Bargaining Agreement is expected to come on Tuesday with a Memorandum of Understanding (MOU), but rumblings of the CBA’s provisions are already ever-present.
A large portion of the labor talks was focused, in some way, around money. Notably, the league’s minimum salary was raised from $414,000 per year to $480,000 per year—a nearly 16% increase. Provisions were also included so that the league’s minimum salary will reach $500,000 per year at some point during the CBA.
The labor deal also includes provisions for a luxury tax, and changes to the number of players eligible for salary arbitration.
The most hotly debated change to the CBA, however, revolved around the league’s amateur draft. In talks, MLB Commissioner Allan “Bud” Selig and the league’s owners advocated a hard-slot. Under this system, teams would be given a defined bonus that they can pay amateur talent, depending upon where a player was drafted. The players, however, opposed a hard-slot, believing that it was a form of a salary cap. In solution to the conflict, the new labor deal will include a draft Luxury Tax. Teams that spend over the recommended slot value will be hit with a tax, but they will still be able to spend over slot if they are willing to pay the penalty. Another change to the league’s amateur draft is also expected. Under the current CBA, free agents may be given a “Type A” or “type B” Elias ranking, based upon their performance during the previous season. Teams who fail to resign a “Type A” or “Type B” free agent are compensated in the following years draft, regardless or whether or not they made an effort to resign the player. Under the new CBA, however, draft pick compensation will not be based upon Elias rankings. Instead, teams will receive draft pick compensation if and only if they make a “qualifying offer,” but still fail to sign the free agent. A “qualifying offer” is defined by the deal as a one-year, $12.4 million contract offer.
Most interesting are the changes the structure of the leagues, playoff, and everyday play. Following the recent sale of the Houston Astros organization to Jim Crane, a millionaire businessman, the team will move from the National League to the American League for the 2013 season. The team’s move will balance out both leagues with 15 teams apiece. As a result, there will be interleague play everyday of the season—not just during select weeks as has been the case since it was introduced in 1997. Additionally, a major change to MLB’s playoff system will also be brought about under the new CBA. Two additional Wild Card teams will be added—bringing the total to two per league—and Wild Card teams will face each other in a one-game playoff at the start of playoffs each year. The winners of the playoffs will advance to the Divisional Championship Series. Surprisingly, nearly 75% of both interested parties approved the aforementioned provisions.
Most importantly, the new CBA will include provisions for the start of drug testing for Human Growth Hormone (HGH). While MLB began testing minor league players for HGH a few years back, no system had yet been in place for major league athletes. The main hurdle in bringing HGH testing to the major league level appeared to be the form of HGH testing. While steroid use can be tested for through urine samples, HGH use can only be uncovered through blood tests. Players’ fears of “invasive” blood draws have apparently been calmed. Beginning with the start of Spring Training in 2012, all MLB players will be tested for HGH. HGH will likely fall under the same classification as other performance enhancing drugs with regard to penalties: the first offensive will result in a 50-game suspension and the second a 100-game suspension.
The new Collective Bargaining Agreement, which was completed nearly three weeks ahead of schedule, will last for five years. By the end of this deal, Major League Baseball and the league’s Players’ Association will have had thirty-two straight years of labor peace (The last players’ strike was in 1981).
No End in Sight for the NBA Lockout
While MLB avoided heated labor conflict, the biggest news story in sports right now is that the NBA did not.
Labor talks between the NBA owners and the league’s Players’ Association broke down on Thursday, November 10 after the players rejected Commissioner David Stern’s “final” ultimatum offer. Stern had told the players that they must accept the offer on the table or be presented with one much less favorable. Rather than giving in to Stern and the owners, the NBA players announced their decision to disband the players’ union and file anti-trust lawsuits against the league and its owners a few days later on Monday, November 14. Specifically, players contend that the owners’ lockout functions as an illegal boycott of the workforce (i.e. the athletes) and demand monetary damages for lost wages. Under the anti-trust laws, the owners could potentially have to pay damages up to three times the actual amount of the lost wages.
Two lawsuits were filed, both in conjunction with the National Basketball Players’ Association. The first was filed in the Northern California District Court and was lead by New York Knicks forward Carmelo Anthony and Oklahoma City Thunder forward Kevin Durant, among others. The second lawsuit, led by Dallas Mavericks forward Caron Butler, among others, was filed in the Minnesota District court. The players picked to lead the suits were strategically chosen because they represent a wide variety of classes within the Players’ Association: rookies and veterans, free agents and players under contract.
The two separate lawsuits were consolidated in the Minnesota District Court this Monday. The consolidation of the lawsuits does not represent weakness by the players. Rather, the players chose to combine the two suits in an attempt to expedite the process and hopefully settle the lockout sooner. The players’ attorney David Boies hopes that a court date will be set for sometime in December.
Litigation will likely take months, or potentially years, to resolve. If the players and the owners leave settlement of the conflict to the courts, there will be little hope for a 2011-12 NBA season. If we are too see professional basketball this season, the players and the owners must resume negotiations and reach a settlement outside of court. Unfortunately, the two sides have not met formally since November 14, and no future meeting appears in sight. While the players appear ready and willing to resume talks—the immediate goal of their lawsuit was, actually, to force the owners to negotiate—David Stern has publically professed his unwillingness to negotiate further.
As optimism for an 2011-12 NBA season is quickly running short, at least we know that there will definitely be professional baseball come April.
Photo Credit: Associated Press
About Dylan Kraslow
Dylan is technology editor for NBR. He primarily writes about the start-up space and the business of sports.
