As one of the premier sportswriters in the country points out, to start the 2010/2011 NFL season, on the verge of a lockout next season, the Vikings and Saints showed a sign of solidarity by all raising their finger together to show that they are one in the collective bargaining session soon to begin!
In a country where unions are ignored when they’re not demonized, it was perhaps the most widely-seen, collectively experienced display of labor solidarity in the history of the United States. Hyperbole? Consider that the game garnered the highest opening night ratings in the history of the NFL. 28% of all households were unexpectedly treated to a taste of solidarity.
While I know that many of our friends on the right will attack this post and the players of the NFL, know that as Drew Brees says more is to come. “You’ll see that a lot,” said Brees, a member of the NFLPA’s board of directors. “That was a symbol of solidarity amongst all players in the NFL. We are one group, one team, one voice.”
Before we start with the talking point of Millionaires V Billionaires, and they get paid to play a game, etc… I will let NFL players Association president DeMaurice Smith answer to that:
Zirin: You’ve got a lot of reporters that say, “A pox on both their houses. It’s millionaires versus billionaires.” How do you make the case to say it’s not just rich people squabbling, that there is something bigger at stake?
Smith: The first thing I do is challenge reporters on how much they know. When I was at the Super Bowl and I had a press conference with 120 or 130 reporters who covered football for years. I asked them raise your hand if you knew the National Football League was a non-profit organization? Silence. It is. It’s a 501 C 6 non-profit. How many people know last year the National Football League generated $9 billion in revenue. According to Forbes every team averages $31 million in profit every year. Every team is worth $1 billion. And here’s the kicker, over the last 15 years every team’s value has grown by about 500 percent. So, that’s the owner’s side.
Now for the players, the average salary in the National Football League is $700,000. You will never find a player who’s going to say we’re crying in the poor house. I tell our players the reason you have to be responsible is that the average wage for a man between the ages of 21 and 24 in America is about $25,000. We should never be in a position where we have to give up based on money. That’s insulting. But on our side of the table, the average career for a football player is 3.6 years. It takes you three years and three games in order to get five years of health care coverage when you’re done playing. If you play any less than three years you don’t get any health care coverage when you tire. If you play three years and three games, you still only get five years.
All well and good, but why is a union even necessary in the NFL?
Oh, I don’t know….maybe to prevent owners from engaging in practices intended to benefits owners at the expense of players. Obviously the example I cited had to do with Major League Baseball, but it could just as easily have happened in the NFL.
The same reason that Unions are necessary in the working world, so the workers get treated fairly and the owners dont screw them.
Well that made sense in the working world at the dawn of the industrial revolution. But if a player doesn’t think he’s getting a good deal with one team, another team may offer him a better deal to his liking. It’s called competition.
Except when teams collude in order to prevent players from getting a better deal, as I wrote above.
For that salary, what constitutes getting screwed? Because the line of people willing to accept whatever your answer is in exchange for what they get paid would be a mile long.
The irony of this is that by far, the biggest example of football players getting screwed over is the case of the retired players – not by the NFL & owners, but by their very own union. Guys who literally gave their lives to the game when tickets were $5 a game & TV revenues were pennies compared to today, they were paid salaries by the owners accordingly. Their union was responsible for retirement – health care & pension. And yet, though the economics of the game exploded, the union turned a blind eye to the guys who laid the groundwork – hurting in every sense of the word. Sometime read about Wisconsin’s own Mike Webster, perhaps the best center to ever play the game – died broke and struggling from severe mental problems as a result of concussions and wasn’t able to get the medical attention he deserved.
Guys who tried to bring the issue to the forefront (like Hall of Famers Jerry Kramer & Joe DeLamielleure) were ignored. Or worse – former head of the union, Gene Upshaw said,
Worse yet, to of DeLamielleure for being a thorn in his side,
Locke, I’m 100% in agreement that what the NFLPA has done to the retired players is unconscionable. Those guys deserve better treatment from the league, but most of all, they deserve better treatment from the union they helped build.
That is a fundamental problem with unions. Union leadership typically does what’s best for them – and generally it coincides with the members, but not always. And while it makes sense and is fair and reasonable that the union and it’s leadership should do what’s best for them, at times this comes a the expense of either individuals (in the cases where cuts are required and the options are to fire 10 people or give everyone a pay freeze) or in potential new members. The latter always surprised me – my instinct would be that they’d want to do whatever they can to add new members and gain power. Then somebody explained it to me: new employees/members take up financial & other resources that would otherwise be available to existing members – the best example is reducing the overtime that goes first to the most senior employees; new members are unpredictable, and a risk of voting against the current union leadership.
Or cut corners in terms of player safety to cut costs, or dont give the players their fair share of licensing revenues, etc…
Worth noting that while it appeared that all the players from both teams were “together” in this, there was clearly one player who wasn’t. When everyone else stepped out on the field, a certain #4 for Minnesota stood on the sidelines with his back to all of this. Haven’t heard any response from him on this, but I’m sure it’ll be along the lines of, “Aw shucks, I didn’t even notice what was going on.” Or maybe, “Well gosh and golly-gee, I guess I was just so focused on preparing for the game, I forgot all about it.” Or maybe, “Well, you know, I was late joining the team because I had ankle surgery – have you seen the pictures?”
Garnering a little respect for #4 for that, if it was intention. All the other players looked like idiots with their fingers in the air.
Maybe – but flies in the face of the “it’s all about my guys” mantra he’s cultivated.
It sure does. Then again, his offseason “will he or won’t he retire” antics have made it clear he’s all about Brett Favre, not about the team.
I can’t parse what the heck Smith is saying in the third paragraph quoted. Anybody know what he’s trying to get at?
I know he’s just playing the game, but the value of the teams has absolutely nothing what-so-ever to do with the salaries of the players. Nothing. Well unless the players actually contribute to the hundreds of millions it costs to buy a team. But seriously, just shows the typical lack of understanding of basic financial terms & how they’re related. Salaries are an expense – and as such, determine, but are also intimately tied to profitability.
The Salary Cap has worked very well to do just that. As it stands, the cap is set at just a tick under 60% of gross revenues. As revenues go up, the players cut of those revenues goes up as well. The owners believe 59.6% is too much. That giving the players 59.6% of gross revenues does not leave them with a big enough cut of revenues to cover their expenses. The players want to see a larger cut. But you can’t tell me that the current system is grossly unfair – they’re quibbling over the details, but getting a guaranteed percentage anywhere in that neighborhood is certainly fair. More importantly, the salary cap has contributed heavily to the rising of the popularity and economics of the NFL. It has kept parity – leveled the playing field so that all 32 teams in the league are capable of building a championship capable team. “On any given Sunday” as they say, one team can beat another. And as a result, we tune in. We buy tickets. And merchandise. Lose that – and customers lose interest and don’t tune in or go to games. Revenues go down and everybody loses. Like baseball. When many of the teams just don’t have the finances to be able to compete with the Yankees, you see the popularity fall.
What is not fair, and absolutely needs to be fixed, is a rookie cap. It makes no sense to anyone – not the team, not the fans and certainly not the veteran players – for guys who have never played a single down in the NFL, someone like Sam Bradford, to get a guaranteed $50 million dollars no matter what. Too many of those guys end up as busts and it’s wasted money that should be spent on proven veterans.
I agree with you in terms of the retired players(although I wont say the owners are blameless) and the rookie salary cap. I also agree that the salary cap has been a good thing and baseball desperately needs it. It not only brings parity, it allows the bottom tier of the league to make a good living also.
I do not agree with you on the “owners paying millions to buy the team” many times when they pay millions to buy the team, they get multi millions in tax breaks. The same with the stadiums, instead of say Miller Park, it should be named tax payer park. None more true than the new Yankees Stadium.
Would there be a salary cap paying out 60% of revenue without a united players union?
I’ll agree on the stadiums. But I think it’s one of those “close your eyes & think if England” things.
Pro sports are a really bizarre confluence of free market, monopoly and centrally controlled structures – and as such, discussions like this are sometimes just very strange if you get into principles. The NFL labor market is on one hand, a monopoly – the NFLPA has a monopoly on the market of NFL caliber/experienced players. But within that group, unrestricted free agency is as much of a free market as you get with teams competing for the services of players. The NFL has a monopoly on NFL teams. But there’s also some degree of market competition there if you think in terms of franchise free agency. Which is where the stadium stuff comes in. A team owner can threaten to move a team if he doesn’t get X million for a new stadium. What makes the threat credible is that there are dozens of other cities willing to do this because of the millions/billions a franchise will generate for the local areas. Finally you have all the licensing stuff – TV & radio broadcasts rights and anything involving copyright are monopolies on the right to copy/distribute various elements/products.
I’m not really sure what Smith is trying to say, but what I will say is that instead of fighting for the salary cap to be a higher percentage of gross revenues, the players should be fighting to get language in the labor agreement that guarantees more of the salary in their contracts, which would certainly ensure a little more stability for players. As it stands now, a player could sign a $34 million contract with only a few million actually guaranteed, only to be released by teams who later regret the contract. One thing I like about baseball (and basketball to some extent) is that teams that sign players to bad contracts are forced to deal with the repercussions of those contracts.
To some extent, that’s the other side of the same coin I mentioned. A rookie cap & different contract structures are “more just” distribution of existing money rather than getting a bigger cut.
I will disagree completely with you on the guaranteed contracts. That’s something that has a negative impact on baseball, not positive & it would only hurt the NFL to move too far towards baseball’s way of doing things. It hurts the teams to be forced to pay guaranteed contracts to guys who turn out to suck. The Brewers were literally paying Suppan to pitch against them last week. It’s bad and breeds contempt by the fans, and it’s bad for competition since it magnifies the difference between the richest few teams & the rest. The NFL doesn’t have teams that have no chance – teams that just churn out players to sell to other teams like MLB does.
In some ways, what you’re asking for reminds me of when schools and teachers or their union rail against homeschooling and/or school choice because it takes state & federal funding away from their district. The funding is…to educate the students – of course your funding should be reduced for each student you no longer have. The guarantees for sports contracts – why the hell should teams have to pay salaries for players who they cut? Don’t get me wrong, there should be protections for injuries, etc. But when a player can no longer get the job done that they were paid to do, a team should be able to cut them & not have to pay their contract for years into the future.
Your example isn’t really a good one or representative of the NFL either. Players always get a signing bonus. This is money paid immediately and is theirs to keep no matter what. For a typical $34 million contract, the signing bonus would be at least $5 million, but as much as $15-20 depending on the situation. Again, this chunk is 100% “vested” on day 1. On top of that, the first year of salary is essentially guaranteed since you don’t sign a guy & cut him before he plays his first year. Cut players still get their guaranteed signing bonus, & all roster & performance bonuses plus salaries they’ve already earned – they just don’t get a salary for future seasons. But they’re free to sign with someone else.
There are always going to be edge cases – on both sides, but they’re just that, rare exceptions. There are two things not mentioned in all the “the team can cut us any time” complaints. First of all the cap treatment of signing bonuses – the fact that though the bonus is paid out in full to the player immediately upon signing the contract, it’s actually pro-rated across the life of the contract in terms of cap impact. This means teams keep players around a year or two (or more) longer than they would without the cap because the remaining uncounted portion of the cap gets accelerated immediately (or over 2 years if they time it right). For example, give a guy a 5 year, $50 million contract with a $20 signing bonus. Player gets the $20 million on day one, but instead of counting the full amount towards the cap right away, the team gets to count $4 million each year for the 5 years. (Salary portion would average $6 million per year (50-20 / 5 years for an average cap number of $10 million per year. Now say the guys stinks – an injury he doesn’t recover from or he just doesn’t care any more since he got his huge paycheck already. After two years, the team wants to cut & move on. But if they it do, they’ll have the remaining uncounted bonus will cost them $12 million right away – for a player who wouldn’t be on the team. They call it dead money or dead cap money. Unfortunately, something Mike Sherman was good at creating as GM. And I’ll repeat this again, because it’s something even most fervent fans don’t get – we’re only talking about the cap number, the actual dollars of that signing bonus have already been paid to (and possibly spent by) the player. Anyway, this is yet another positive thing about the cap – at least if you’re a veteran player – it artificially creates a little more stability.
The other thing that goes unmentioned in the “poor players, they might get cut” is that while the contracts explicitly spell out what happens if players get cut before fulfilling the contract, and the signing and roster bonuses reflect the balance negotiated between the player and team specifically to mitigate that concern, players routinely protest or even hold out when they feel like they want more money and there’s almost nothing the teams can do about it.
Overall, the NFL owners and players have worked themselves into an excellent balance to create the most popular and lucrative professional sports league and found a very good balance of risks and rewards for all sides. Minor tweaks here & there are fine. Major changes will upset the balance and a work stoppage might not kill the goose, but it will certainly reduce the number of golden eggs it produces.
Forgot to mention, on the “fair share of licensing” front, the NFLPA is responsible for licensing out the “likenesses” of NFL players and gets all the dough.
Which players make less than $700,000 a season in salary?
If $770k is an average, who makes less? Anybody?
Are we parsing compensation by saying salary and not total compensation?
Well, if we look at the Packers roster from 2009, here’s a partial list of the players who made less than $700k in salary:
Keep in mind that’s base salary.
FYI, league minimums starts at $325,000 for rookies and steps up with years of experience through to $860,000 for 10+ years experience. For league minimum purposes, that amount does include any bonuses, although the bonuses count in the year they are paid (not pro-rated).
Interestingly enough, while the salary cap in general creates a stabilizing effect, a pressure to keep veterans around longer that their performance might justify (due to avoiding cutting a player & facing the cap hit of accelerated signing bonus & dead money), the league minimums do just the opposite. The higher minimum for more veteran players means that if a team has two guys who are perform roughly at the same level, if they have to choose, they’ll cut the veteran and keep the rookie.