NFL fair labor deal (cont.)
Roughly speaking, in 2009, the last season with a salary cap in the NFL, per team player costs were about $150 million -- a $128 million salary cap and another $20 million-plus of benefit-related expenditures. Owners are seeking to adjust that overall number to the range of $125 million in per-team player costs, an NFL club source said, with the difference being used to fund initiatives that they say will help grow the game. The players counter by asking for financial transparency to see exactly why that money is needed, where it will go and how it will be used.
"That's why the 18-game schedule is the easiest way to grow the pie,'' a NFL club executive said. "At the end of the day, if that's the only way for the players to get a better deal, they'll probably do it, as long as rosters are expanded, offseason workout rules are adjusted, and the post-career medical benefits are extended.''
One veteran agent told me this week that's the reason he believes the 18-game season is a fait accompli, even though players and fans don't really want it. In time, the players will realize the extra money generated will lessen the impact of their losing a portion of the league's revenue pool, and come to view 18 games as a more acceptable tradeoff.
"The nut of this whole thing is how much of that $1 billion are they going to be able to keep?'' the agent said. "They know they won't get the whole thing. It's really about how much of that money can they get back? Is $500 million possible? It might be. With the new revenue of 18 games, that might be realistic.''
Neither side seems to be starting the labor negotiations with a targeted point of where the percentage of players-owners revenue split has to be to work for them, sources say. Part of the reason is because there are still too many moving parts that will play into how those percentages fit into the final agreement.
"Would the league accept 54 percent (of post-expenses revenue to players) if it got everything else it wanted in terms of the 18-game schedule, the rookie wage scale and the forfeiture language?'' another NFL club executive said. "Or is it better to fight for 53 percent and losing all the rest of those battles? I don't know if anybody knows yet.
"You can't look at the numbers without looking at the whole deal and seeing how the other issues factor in. If it's 16 games as opposed to 18 games, the numbers would change, so you can't separate it out and say in abstract that it would be a good deal for either side at this percentage or that percentage.''
Still, both sides recognize that the players' slice of revenues will decrease from 2006 standards, and the owners' will increase. And every percentage point it moves represents millions of dollars.
"My sense is neither side was ever prepared to make a deal before the CBA expires,'' the veteran agent said. "If De Smith thinks he's getting a deal between now and March 4, he's crazy. And if he thinks he's going to get a better deal after March 4, he's na´ve. There are some owners who are really angry, and there are some owners who are more player-friendly. But I'm not sure there is more of them than the angry ones right now. There are some hard-liners who want to kick the players' ass. They really want to exact some revenge on the players.
"This thing is going to take a while though because the players need to be much closer to the brink of disaster before they compromise. Keeping something like 54 percent (of revenues) would probably be pretty good for the players. Something like 52 percent would probably be closer to an ass-kicking. There were years gone by where the players would have been thrilled with 52 percent, but not now.''
Will a season be jeopardized?
A second veteran agent I talked to this week said given the lack of bargaining sessions and the rising acrimony between owners and players in recent days, he has grown increasingly pessimistic about the chances of the 2011 season being played. He sees no pressure point to compel both sides to negotiate in good faith until the regular season is in jeopardy. And even then he wonders if both sides won't be dug in too far at that point to give any meaningful ground.
"The owners talk about growing the game, but the only way the game will grow is if there is a game,'' the agent said. "If the game stops for a year, some people will find they can live without it. The more this unfolds, I'm starting to think either a season is going to be missed, or this thing is going to get locked up in court for a long time through decertification. It's almost a rewind back to 1987-92, when there was football but no CBA.
"The more I hear, it seems like the owners see this as a time where they can try to break the union. Even though they actually need the union, so they're not vulnerable to getting sued for anti-trust charges. It's going to be tough for Roger Goodell, because procedurally it's only going to take nine votes (from owners) to block a deal. It's not going to be easy to get something done.''
Union sources refuse to confirm when or if the NFLPA will pursue its decertification option, because it likely considers that move something of a last resort that comes with some inherent risk. There's no guarantee that its decertification will be recognized by U.S. District Court Judge David Doty in Minnesota, who has issued favorable rulings in the past for the NFLPA in its labor showdowns with league management. But if he does grant the union's decertification, it would clear the way for anti-trust litigation and block the NFL from locking out its players.
Much of the union's confidence in its position seems to be based on having the decertification option in its back pocket. One NFLPA source I spoke with said "the greatest chance for a resolution is with factors that the union and the league are not in control of,'' i.e. the courts.
While the union won't talk about decertification, it seems to have been preparing for the possibility nearly as long as league owners have been making lockout plans, with the NFLPA securing the authorization to decertify in a team-by-team vote during the 2010 season. History offers a ready reason why decertification looks like the union's most likely course of action.
"It's probably their best solution, because anything the players have ever gained has been in Doty's court, and not through a work stoppage [a players' strike],'' one agent said. "If there's a lockout and they decertify and go to court, there'd be some short-term suffering for some players between now and the years before the case got decided, but the decertification would keep football going. It's not a CBA deal, but the football would resume.
"That's why it's the best leverage the players have. The league knows it doesn't want to go that route and wind up back in Doty's court, where it has never won. That's why it's trying to challenge the union's ability to decertify.''
Though the league has been emphasizing the March 3 deadline for striking a deal before either side starts feeling any financial pain, sources I talked to on the union side of the spectrum don't foresee players feeling a sense of utmost urgency to negotiate until the regular season looms.
"The pressure will come the day before and after the regular-season game checks would have been due,'' a veteran agent said. "The games are the point of no return. And really up until then, the fans won't really feel it either.''
One agent I spoke with said that despite all the information that has been made available to the players about what could be in store this offseason, some remain unprepared, asking about offseason workout bonuses that won't be paid in the event of a lockout, or just now learning about COBRA medical insurance coverage that will be their responsibility once a lockout begins. Some of the less-informed players will be the greatest threat to union solidarity once the lockout starts to lengthen and approach the regular season, the agent said.
"I kind of know how it's going to go in some cases,'' the agent said. "When it comes close to time for the game checks, some players will fold like folding chairs in late August, when the real money starts being in play. Not the majority of them. But some of them. The union doesn't want us to say that, but it's reality. The real pressure point will be the start of the season.''
It's instructive to remember that it was some of the NFL's biggest stars who proved so undermining to the union's efforts in the players strike of 1987. After the union voted to strike two games into the '87 regular season, stars such as Joe Montana, Mark Gastineau, Randy White, Lawrence Taylor, Howie Long and Steve Largent were among the 89 players who eventually crossed the picket line and reported back to their teams, joining both replacement players and their fellow strike-breakers.
Could there be a similar breaking point of this labor showdown looming in late summer or early fall? How will a player like recently franchised Baltimore Ravens defensive lineman Haloti Ngata react when he's facing the forfeiture of his roughly $700,000 paycheck each week? Will he take that financial bullet for the long-term good of his fellow players and the NFLPA's cause? Or will he and other prominent players exert pressure on Smith and the union at that point to cut their best deal and get back to work?
"Part of the disconnect in this situation is that you're asking players who have a short-term career to look at the long-term benefits of the deal,'' an NFL club executive said. "There's just not a horizon matchup for them.''
It's still just a staring contest
With the current CBA still having two more weeks to run before expiration, we're still in the phase where both sides are talking about holding real negotiations, but doing very little of it. It remains a battle for hearts and minds, and both the union and the NFL are engaged in the effort to shape public opinion to their point of view.
To that effect, Smith held a conference call with the player agent community on Monday, asking them to consider having their clients boycott next week's NFL Scouting Combine in Indianapolis as a show of strength and solidarity with the players union. It was not a well-received proposal, sources said.
"He got shut down pretty quickly on that,'' an agent told me. "It kind of told me how na´ve he is with stuff like that. These players, this draft class, is really not a part of this whole process, and yet they're going to kind of get thrown under the bus in this deal. They're already going to get a rookie wage scale, and he's asking them to boycott after they've been training for this event for months already, with a lot of agents paying for that training for months.
"He quickly abandoned that idea and asked if we can have the draft's top 10 players or so boycott the draft festivities that weekend in New York. That's really no big deal. The top 10 players can be induced to stay home and have a draft party instead of going to New York. But that tells you it's not going to be quick. I think it's going to be ugly. Maybe something happens late summer or early fall. I know I've been telling my guys it's a great time to go back to school and get your college degree, because you're going to be on vacation for a while.''
Interestingly, one NFL club executive told me he believes the agent community could conceivably wind up playing a key role in getting players and management to work together towards a deal. Agents have relationships with both sides and might try to exert their influence if negotiations go nowhere for months.
"That hasn't played out yet, but in the end the wild card in this negotiation is the agents,'' the NFL club executive said. "They understand both the short-term and long-term interests at stake in this, and they probably have the greatest feel for the true pulse of the players. If this goes long enough, the players may start to listen more to the agents than the union reps or the union.
"The agents can see it both ways, and they'll be looking for solutions to get guys paid. They'll be dealing with guys who have been paid, guys who need to get paid in the future, and guys whose money is on the line right now. They're a critical swing area, but we haven't gotten to the stage where they can be influential yet, because the players haven't turned to them.''
One of the things we like most about football and sports in general is the clarity it provides. There's a winner and a loser of every game, and there's a scoreboard to tell you which is which. But there's very little clarity on display in a labor negotiation, and the spin, rhetoric and posturing continues to be a big part of this game. Whatever winds up being the terms of the next CBA, it's clear no one has put their best deal on the table yet.
"It's like a couple of armies still facing each other down,'' an NFL club executive said. "They're both still trying to out-flank each other. Once they both start running in the middle, you might get a deal. But right now, nobody's running in the middle. It's just a staring contest.''
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