NFL Owners Responsible for Starting Bad Faith Negotiations and Potential Lockout

Michael JeeCorrespondent IFebruary 21, 2011

Arlington, Texas, can lay claim to hosting the most-watched television program in Super Bowl XLV, despite some major problems ranging from uncooperative winter weather to an unprofessional ticket fiasco.

Indianapolis may not even get the chance.

Currently, NFL team owners and the league’s players, represented by the NFL Players Association, are trying to compromise and address each side’s concerns as best as possible.

The two parties agreed to federal mediation and have met for a third day, the most promising sign in weeks, if not months, in the contractual standoff.

Still, the possibility of Super Bowl XLVI’s cancellation, or an indefinite hold at least, remains real.

If this dreaded scenario does materialize, the blame lies squarely on the NFL owners’ shoulders.

Team owners foreshadowed the present deadlock when they lawfully but prematurely decided to opt out of the now-defunct contract bargaining agreement in 2008.  The agreement’s early termination is quite baffling considering it was the owners, in the first place, who voted by a 30-2 margin two years earlier to extend the deal until 2012.

Owners claim that players need to take paycuts if the NFL is to remain viable and profitable while unilaterally pushing to extend the regular season from 16 to 18 games and reducing preseason games by two.

By ending the collective bargaining agreement in 2008, they can argue that the players’ union had ample time to prepare and propose a suitable compromise.

However, the owners’ main argument for the CBA’s abrupt dismissal and for their new proposal holds no water.

Foremost, with exception of the Green Bay Packers, owners have not released—and seemingly will not—their fully audited financial statements.  They want players and fans alike to simply trust their word that the league faces financial trouble.

Their assertion is entirely false.

In truth the NFL has never been more profitable, according to Kurt Badenhausen of Forbes SportsMoney.

By Badenhausen’s count, the average team earned $33 million in operating profits (earnings before interest, taxes, depreciation, and amortization).

Badenhausen’s colleague, Maury Brown, reported that the NFL raked in $9.3 billion in 2009 as revenues grew 9 percent from 2008 to 2009, even in the Great Recession. 

Game attendance has remained healthy over 254 home games and drew 17,007,172 people in 2010.  That figure represented a 139,232 drop in paid attendance, less than one percent (0.81%).

Forbes’ most recent NFL franchise valuations reveal that 19 of 32 clubs are worth at least $1 billion.  For comparison, Major League Baseball only has one team—the New York Yankees—valued at over $1 billion, as ranked by the magazine.

Moreover, John Ourand of SportsBusiness Journal has reported that ESPN and the NFL are close to a deal that would have the network paying close to $2 billion annually—a 65 percent fee increase—to broadcast Monday Night Football.

Along with ESPN, CBS, Fox and NBC will pay the NFL $4 billion a year to televise games and have agreed to do so in 2011, lockout or no lockout.

All the while, players’ salaries including rookie wages, which are tied to revenue, have not increased proportionally in recent years.  

Instead, the players’ share of revenue has dropped slightly since 2006.  Not since the 1980s, before the days of free agency, will the players’ share of revenue be as low if the owners get their way.

Granted, the average NFL player makes significantly more money than the average worker in any industry.

Still, in context, players have not received a fair shake notwithstanding their higher-than-normal salary and the fact that their job entails playing a sport.

Players’ health and long-term livelihood are at stake, as well.

The median length of an NFL career is just 3.6 years with a minimum salary of $320,000 to $545,000 during that span.  Frequently, fans forget that headliners such as Aaron Rodgers and Tom Brady—strong supporters and team reps for the NFLPA—are the exception, not the norm.

For that reason, players show natural concern for their health; their ability to play now  and life after retirement.  Can they lead a full, healthy, and productive life even on a short-lived but high-paying wage?

That future may hold some atypical handicaps.

Many players sustain repeated concussions that can lead to brain damage, and the intense physicality of the game can cause lifelong implications.

A study commissioned by the NFL and conducted by the University of Michigan’s Institute for Social Research, has shown that cognitive diseases like Alzheimer’s are more common in former players.

The findings support similar independent studies, such as papers published by the University of North Carolina’s Center for the Study of Retired Athletes, regarding NFL players and the effects of their occupational head injuries.

Professors and doctors nationwide, including at New York’s Mount Sinai Hospital, have echoed and affirmed the results.

It is highly possible an uncertain future with potentially-expensive health care costs could await and hit players hard, a daunting reality that a brief period of a six-figure salary may not sustain.

To add insult to injury, the NFL has said that it will not continue active players’ health care in a lockout even with knowledge of the health issues players face.

In light of this stark circumstance, players have already made concessions.

They have repeatedly stated contentment with the previous CBA and revenue sharing, and have accepted a rookie wage scale with a “Proven Performance Plan,” which basically specifies that rookie deals would reduce in length to three or four years—creating an approximately $200 million revenue pool that would benefit retirees and fund incentives for players who outperform their contracts.

On the other hand, team owners have not provided any substantive allowances.  

They will still reap millions in the end while players and fans, not to mention workers and local economies, suffer the consequences of their adamant demands.

The current impasse obviously resulted because of money.

One side already has it and, for all intents and purposes, wants a bigger piece of the pie.  Yet, the owners will not disclose exactly how many chips they bring to the table.

At bare minimum, not only does their suppression thoroughly lack transparency, but it just goes to show that they took negotiating in good faith off that table from the start.


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