SBJ/May 21-27, 2012/Labor and Agents

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  • Union leaders say decertification still has role as labor tactic

    Liz Mullen
    Just when conventional thinking in the industry was that the concept of decertification was dead, two players association leaders raised the specter of dissolving sports unions in the future at this year’s Sports Lawyers Association annual meeting.

    The first to raise the subject was Ron Klempner, associate general counsel of the National Basketball Players Association.

    “The purpose of decertification, if we do it the next time, will be because the collective-bargaining process has pretty much run its course in professional sports,” said Klempner during a panel titled Town Hall Debate: Collective Bargaining: Winners and Losers.

    The association’s annual conference is attended by about 600 lawyers and law students, including attorneys who represent players, teams, leagues, sponsors and networks.

    Klempner’s remarks caused a stir in part because the NBPA fought off an effort led by seven powerful agents to decertify the union when the NBA imposed a lockout on July 1 last year.

    “I was surprised he would say it,” said one of those seven agents, who did not attend the conference but heard about Klempner’s remarks from lawyers who were there. “But I am not surprised he would think it. There has to be a different structure. The players have given back too much.”

    The agent asked for anonymity because he was not authorized to talk about union business.

    The NBPA did end up dissolving, temporarily, in November through a process called voluntary decertification, but only after the agents had gathered enough signatures from NBA players to hold an election to disband the union, a process called involuntarily decertification. Either type of decertification allows labor union members to file antitrust lawsuits against their employers — in this case, the NBA. The NBPA did file such a lawsuit, but it was soon settled, the NBPA reformed as a union, the lockout ended, and a new CBA took effect.

    NBPA Executive Director Billy Hunter, who did not attend the conference, originally fought off the idea of decertification, choosing to use federal labor laws against the lockout instead of antitrust laws. The NBA and NBPA filed unfair labor practices charges against each other with the National Labor Relations Board, but the lockout was over before the NLRB ruled on those charges.

    In his speech before the SLA gathering, Klempner said that for many years labor laws protected players and gave them the ability to fight for rights such as a minimum salary, arbitration, free agency and pensions.

    “As time went on, the money began to shift from the owners to the players,” Klempner said. “And now, the purpose of the union … is not so much to prevent exploitation, but it’s really to protect the owners.”

    Both NFL and NBA players made concessions after being locked out by owners in those sports last year. In the NBA’s case, the players reduced their share of revenue from 57 percent to roughly 50 percent. Klempner said the players made the concessions rather than lose the season — which would have taken away more money from players than they would have been able to earn back in their relatively short earning careers.

    But Klempner said every level of player indicated that players were growing tired of owners asking them to give back.

    Meanwhile, the NHL CBA expires Sept. 15, and unlike last year, when it was clear months in advance that disbanding the union was something both the NFL players and NBA players might do, that action has not really been talked about in regard to NHL players.

    One big reason for that is Don Fehr, who took over as executive director of the NHL Players’ Association in September 2010. Fehr joined the NHLPA after 25 years of heading up the MLB Players Association, long considered the strongest union in sports and which has used labor law through the years to fight off the imposition of a salary cap and other restrictions.

    Fehr could not attend the SLA meeting. His brother, Steve Fehr, who serves as outside counsel to the NHLPA, took his place on the union executive directors panel at the event.

    Although Steve Fehr did not suggest in any way that decertifying the NHL players union was a serious option in the coming labor talks, he did address the subject of decertification during his presentation before the SLA group.

    Fehr noted that former Solicitor General Ted Olson, who represented the NFL players in the Brady v. NFL case, said last year about sports, “This is not an industry in which it advantages the employees, the players, to belong to a union.”

    Fehr said, “I thought, ‘Wow, that is quite a statement.’ I don’t think any players who were members, or are members, of the MLBPA would think that. I don’t think many members of the NHLPA would agree with that — but I don’t know; maybe we will find out.”

    The NHLPA’s outside counsel expects health and safety issues to be a priority in labor talks.
    Photo by: AP IMAGES
    Fehr, who has served as outside counsel to the MLBPA since the 1980s, was involved in filing an amicus brief for both the NHLPA and the MLBPA in favor of the NFL players in Brady v. NFL before the 8th U.S. Circuit Court of Appeals.

    NHL TALKS WILL INCLUDE CONCUSSIONS: Fehr told the audience at SLA he expects that when the NHL and NHLPA begin formal bargaining, health and safety issues, as well as disciplinary issues, will be discussed.

    “Concussions will, no doubt, be a priority,” Fehr said. “We need to figure out what is going on, what is the state of the science today. How are players getting concussions, and what exactly is the best thing to do about it?”

    As for disciplinary matters, Fehr noted that in MLB, players do not have a right to have their discipline for on-the-field conduct heard by a neutral arbitrator, but players cannot lose salary even if they are suspended.

    “In hockey, you have neither [right] at the moment,” Fehr said. “You don’t have the right to have a neutral party decide whether the punishment is for just cause and you can lose money.”

    Appeals of NHL suspensions are, under the current CBA, presented to NHL Commissioner Gary Bettman.

    Berthelsen says if Cam Newton continues to play well, his next contract will come early.
    Photo by: GETTY IMAGES
    NEW FEATURES IN NFL CBA: Richard Berthelsen
    , general counsel for the NFL Players Association, addressed what he said were misconceptions about the rookie pay system in the first year of the NFL’s new CBA.

    Berthelsen said that despite a public perception that all rookies are being paid less under the new deal, only first-round selections have had their pay cut. “Players drafted in the second through seventh rounds actually make more money,” Berthelsen said at the SLA event.

    All rookies now have four-year deals — except for first-rounders, who have five-year deals, but clubs must decide in the third year whether to exercise the fifth-year option.

    Before the new CBA, there was criticism of first-round “busts” making more than proven veterans. Under the new deal, clubs can cut or not exercise the fifth-year option on players who don’t perform — but players who do perform will be rewarded, Berthelsen said.

    Using last year’s No. 1 draft pick, Carolina quarterback Cam Newton, as an example, Berthelsen said, “If Cam Newton continues to play the way he did in his first year, the team can’t wait to renegotiate his contract.” Newton’s next deal, Berthelsen said, “will be in the neighborhood of Peyton Manning or Drew Brees or Tom Brady or, if not, even higher. So don’t feel sorry for him. He’ll be just fine.”

    Berthelsen spoke on May 12, three days before he was set to officially retire. Berthelsen will continue to act as a senior adviser to the NFLPA, but his official retirement date was May 15, 40 years to the day after he was hired as a young lawyer at the union.

    Liz Mullen can be reached at lmullen@sportsbusinessjournal.com. Follow her on Twitter @SBJLizMullen.

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  • California workers’ comp board ruling defers to ‘forum provisions’ in players’ contracts

    In a ruling that could alter the sparring between the NFL and NFL Players Association over where players can file workers’ compensation claims, a California regulatory body said earlier this month that it would respect provisions of an NFL contract that specified the state in which such claims are filed.

    The owners and players were unable to resolve the controversial issue last summer in reaching a new collective-bargaining agreement, leaving many workers’ compensation cases unresolved.

    The NFLPA has contended in various courts that so-called “forum provisions” in player contracts requiring that players file in a specific state are unenforceable because California law trumps the provisions. Just 10 days ago the NFL filed in an Ohio federal court, suing the union among others, asking the judge to enforce an arbitrator’s decision that 36 former Cincinnati Bengals players could not file in California.

    Players want to file in California because of the state’s employee-friendly laws, including the ability to collect damages even if they only played a limited number of games there. However, their contracts frequently specify that claims must be made in the team’s home state.

    The California Workers’ Compensation Appeals Board ruled May 1 in a case brought by former Bengals defensive end Vaughn Booker, stating “even if we were to assume that the [board] has subject matter jurisdiction, we would decline to exercise that jurisdiction here because the contract between applicant and the Bengals contains a forum selection clause requiring that he make any workers’ compensation claim exclusively in Ohio.”

    That appears to run counter to an argument the NFLPA has made. The union declined to comment, but in a case pending in a Louisiana federal court, for example, the NFLPA has contended that eight former New Orleans Saints players were not bound to the forum provisions in their contracts because, “The California Workers’ Compensation Appeals Board … has ruled that any provision of an employment agreement between an NFL Player and Club that purports to limit the NFL Player’s ability to pursue workers’ compensation benefits in California is void and unenforceable.”

    The point, however, is being debated elsewhere. Gibson Dunn & Crutcher, representing former Tennessee Titan and hall of famer Bruce Matthews in his appeal before the 9th Circuit of a ruling requiring his claim to be adjudicated under Tennessee and not California law, told that court that just because the California board “ultimately decline(s) to exercise jurisdiction (that) does not mean … that private parties can by contract divest the WCAB of jurisdiction altogether.” The NFL told the same court, “WCAB squarely rejected the argument that a forum selection clause is a waiver of California Workers’ Compensation law. To the contrary, such provisions are valid and should be enforced if reasonable.”

    John Goldman, a labor attorney with Herrick Feinstein, called the California ruling significant because it is coming from the WCAB and not a federal court.

    “If anyone was going to be paternalistic with regards to California labor laws, it would be the California compensation board,” he said. “They are saying not only does this not concern us, but it does not concern us because you guys agreed it did not concern us.”

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