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Collective Bargaining Agreement contracts MLS

Does MLS place business ahead of soccer?

MLS and its players came to an agreement that will see games return via a summer tournament, but at what cost?

MIAMI, Fla. — (5 June 2020) On Wednesday, Major League Soccer and the MLS Players’ Association came to an agreement on the new Collective Bargaining Agreement (“CBA”) and the resumption of the season in the current climate. The negotiations could fairly be described as having beeen tense, prolonged, and damaging to the relationship between the players and the league owner investors.

They culminated with Commissioner Don Garber issuing a threat to lockout the players. Given the circumstances, it was a tone-deaf way to handle talks that were ongoing.

A lockout is drastic. It represents an escalation and is the “ultimate management weapon” in any labour dispute. Garber acknowledged he was the one who threatened the lockout in the hope it would push the players toward an agreement. He said the league is set to lose $1 billion because of the coronavirus. Going with a basketball anology, he equated it to being put on a “24-hour shot clock” to accept the league’s offer.

However, it is open to debate whether, given the current circumstances in which the MLSPA had repeatedly agreed to MLS’ proposal’s amid the ongoing global pandemic, the choice of this weapon was at best unwise and at its worst unnecessarily derisive. 

The threat was in response to changes to details from the CBA that had already been agreed upon in late February before the pandemic. In essence, MLS was attempting to use the pandemic to procure for themselves a better deal. When the negotiations didn’t produce immediate results, they had the boldness to raise the stakes even further by threatening to not pay the players, withdrawing their health insurance and the other basic benefits that come with their employment as a player. Moreover, the league did this in the midst of one of the most uncertain periods in the country since the Great Depression.

To their credit, the union did not fold in the face of Garber’s threat. On the contrary, the threat unified the players more than ever, angered that the league had threatened to lock them out. In the end, it was the league that relented, amending some of its demands, moving back the deadline for the threatened lockout and eventually coming to an agreement that will allow it to return from its COVID-19 suspension with the summer tournament in Orlando. But the players still had to agree to make amendments to the CBA that was to run from 2020 to 2024 and which had already been agreed upon but not yet ratified. At the time the CBA was agreed to, the MLSPA characterised the agreement as a success. That might not be the case now.

Although the lockout was avoided, the damage has still been done. The players were taken aback by the manner in which the league conducted itseld this time around. Nashville SC defender Daniel Lovitz let his opinion be known when asked about Garber’s behaviour. Speaking to Ben Wright, Lovitz said:

“We hope that in time the wounds from the process heal, but it’s really tough to hear the league say they are interested using the partnership between the league and the players to help grow the league into what they want it to be when they continually show us what they think of the partnership that we share.”

Daniel Lovitz, Nashville SC

Lovitz’ entire statement is copied below.

Analysis

The suspension of play due to the COVID-19 pandemic became to be seen as a chance for the league to claw back some of the gains the players made in the new CBA and to reinsert new language beneficial to owners. 

As a result, MLS has lost the trust of its players, who had every reason to be optimistic after a mostly harmonious collective bargaining negotiation over the winter. The facts of this case tell a tale of a league that time and again acts in an adversarial manner towards the union. For its part, the union has in the past been too conciliatory. Players say the lack of cimmunicaton from the league added to their frustrations; that, and the points the league tried to renegotiate was counterproductive to reaching an agreement.

Let’s be clear on one point. It wasn’t the insertion of a force majeure clause into the CBA itself which was objectionable to the MLSPA. The players association had already conceded that item. Rather, it was the fact the league came back to the union after they had already agreed to the insertion of the clause with a twist that would have greatly expanded the possibility of its being invoked: Under the MLS’s proposal, the clause could have been triggered if only five MLS teams (out of the 26) experienced a 25 percent drop in attendance from the previous season. This would have been over the entire five years of the CBA. Most MLS teams do not hit 90 percent capacity for most games, so it’s entirely conceivable that the drop in attendance might occur.

Force majeure clauses are provisions that allow one or both parties to void a contract if circumstances arise that are beyond the control of the party seeking to rescind the contract. A fuller discussion of this contractual provision can be found here. The point of having a contract is that sets forth the rights and obligations of the parties, as well as their expectations. In this case, extending the scope of the force majeure clause to allow for MLS to rescind the CBA based on a few teams’ attendance figures could easily frustrate the expectations of the union that they had a solid five-year agreement that they could count on in place. As someone who has drafted many contracts, inserting such specific terms into a force majeure clause expands the definition of what constitutes force majeure in an “unprecedented” fashion. It certainly would have been beyond anything used in other North American professional sports leagues. 

In contrast, the three-pronged approach proposed by the MLSPA is used by the NBA. It called for MLS to be able to terminate the CBA with 30-day notice if an event or condition, makes it impossible for the league to perform its obligations under the CBA, frustrates the underlying purpose of the CBA, or makes the CBA economically impracticable to carry out.  

The players were awakened from any belief that this league is about them, or even that it’s about soccer. It’s about the bottom-lines of billionaire team owners. The pandemic only made it clear. 

The course of negotiations saw the league take a hardline approach from the onset. The CBA had been agreed on, but not ratified by either side. The decision was made to tie ratification of the CBA into an agreement to restart the season.

MLS started negotiations on April 16th by floating a 50 percent pay cut for players at a time when league executives had taken a maximum cut of 25 percent. Furthermore, MLS also did not seek players’ input to help design a return-to-play plan. Instead, the MLSPA sometimes learned details of the Orlando plan through media reports, prompting the league to issue a memo threatening employees with punishment for leaks in part because they were “impacting our negotiations with our players.” Despite players voicing concerns about leaving family for an extended period during the pandemic — and with games in home markets becoming more viable by more state governments — the league remained focused on playing in Orlando in part to improve their standing with partners Disney and ESPN ahead of the expiration of the current TV deal after the 2022 season. 

league and its owners have shown is that they care most about the health and safety of their bank accounts.

From the point of view that “it’s not personal, it’s business,” this was outstanding negotiating by MLS. After all, at the end of the day, without the billionaire owners, there is no league for the players to play in. The owners know that they enjoy an advantage that owners of other professional teams do not enjoy. Most MLS players are don’t have huge sums of money in their bank accounts, unlike the NBA, NFL or NHL or MLB. So any work stoppage would hit home hard and quickly. The biggest salary group in MLS is the “middle-class” soccer players. Like most of the people reading this, they can’t afford not to be payed. It’s the classic American story that is played out everyday; corporations run by billionaires versus the other 99 percent. You already know how that story goes.

While MLS’ tactic might have been effective, was it worth the cost? The MLSPA might be conciliatory on the outside, but inside the union, the threat to lock players out and take away their pay and health benefits in the middle of a pandemic will not simply be forgotten.

The league calculated that it was holding all the cards, and there was little fallout to be concerned about. A great deal of fans don’t follow MLS close enough to know of, much less care about the intricate details of the acrimonious negotiations. Most fans simply want to see games. It’s one case where MLS gains an advantage by not being in the centre of the media spotlight like the other professional sports in this continent.

The players feel that they’ve acted like equal partners, but, in return, were met with heartless negotiating tactics from the league. The players were awakened from any belief that this league is about them, or even that it’s about soccer. It’s about the bottom-lines of billionaire team owners. The pandemic only made it clear.

When the agreement was announced, Commissioner Garber had this to say: “I want to say that as difficult as those conversations were over the last three weeks and month or so, the players showed great leadership,” Garber said. “And I applaud what they have done to organize themselves and to be smart, to be thoughtful, to understand the detail of this agreement, to fight and advocate for it, and to do it in a very respectful way, and to do it in a very professional way.”

How all of this plays out in future discussions between the league and the players association will only be known over time. MLS talks about being a league that players will choose to play in over others. That message seemed to be lost on the players during the current negotiations. As another player who spoke to The Athletic on condition of anonymity in order to prevent retribution put it, “You talk about being a league of choice, but the choices that were presented to us, they really didn’t seem like choices at all.” 


Statement by Nashville SC Defender Daniel Lovitz:

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By Ken Russo

My work in the business of soccer applies skills acquired in law practice with a focus on the sport's commercial, communications and sporting components. Russo Soccer aims to inform, educate and engage in dialogue on news and relevant issues in the game.

Um advogado por formação, concentro meu trabalho nos negócios, comunicações e operações de equipes no futebol mundial. | Abogado con fundación avanzada en comunicaciones, enfocado en los negocios del fútbol y las comunicaciones. | Je suis un avocat experimenté dans les affaires de football.

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