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Looming Lockout

The start of the 2010 National Football League (NFL) season was certainly unusual, as anyone who tuned into the opening game can attest. Right before kickoff, players from the two opposing teams--the New Orleans Saints and the Minnesota Vikings--demonstrated solidarity when they walked onto the field holding up their index fingers and delivered a clear "we are one" message on national television.

The public display wasn't necessarily a warmhearted gesture. Rather, it was a silent signal to NFL team owners that the players intended to stand their ground in the ongoing heated negotiations for a new collective bargaining agreement (CBA).

The CBA between the team owners and the players union, the National Football League Players Association (NFLPA), will expire March 4, and at press time, a new agreement still had not been reached. This delay means the owners' threat of a lockout--meaning a nonexistent 2011 season and enormous financial losses--not to mention furious fans--may become reality, although negotiations are expected to continue.

The NFLPA estimates that an average of $160 million in local spending and 3,000 jobs would be lost in each league-participating city if the full 2011 season were canceled. The NFL hasn't canceled games due to labor conflicts since 1987.

Much of the standstill in negotiations is due to financial issues. Although the current CBA has been a boon to both signatories--players' median salaries increased 9.4 percent and team values rose 16.2 percent from 2006 to 2009--owners say it is too much in the players' favor. Citing massive costs for stadium construction and maintenance, the owners say they haven't recouped enough of their spending and are pushing for more games per season to increase their bottom line. They also want the CBA to establish rookie salary caps and a reduction in players' share of total revenue.

"The owners are basically looking for the players to take a hit," says Gregg Clifton, a partner at Jackson Lewis and co-chair of the firm's Collegiate and Professional Sports Industry Group.

Not surprisingly, the players vehemently disagree. "This is one of the first negotiations where the players are not really making any demands," says Clifton. "The players are saying, 'We just want to keep what we have. In fact, we'd be happy to extend the agreement we currently have.'"

The players claim that playing extra games--even the two additional games per season (bringing the grand total to 18 regular season games) the owners are requesting--will be too demanding on them physically and would increase injury risks. The players say they won't discuss extra games unless a reduction in off-season workouts and full-pad practices in training camp are considered in the new contract.

A letter dated Dec. 1, 2010, from NFLPA Executive Director DeMaurice Smith advised all players to save their last three paychecks in case the 2011 season is canceled. The letter recommended that players consult with their advisers to prepare for the possibility of lack of income. Players would lose their health insurance if there is a lockout.

Clifton says the stakes are high for the players in these negotiations, perhaps more so than for average corporate employees facing a possible strike, "because the playing career is of such a short average duration. They really don't want to miss out on a season; it's very difficult to recoup those lost wages. There is a short-term nature to their wealth. They might be making $5 million or $10 million a year, but they might make it for four years."

The negotiations take on added complexity because this is the first bargaining agreement in which Smith and NFL Commissioner Roger Godell have ever been involved. Both are fairly new to their positions; Godell assumed his position in 2006, and Smith started in 2009. "Both parties are leading their groups into this collective bargaining negotiation without any prior history of working together on a collective bargaining agreement," says Clifton.

Although the March deadline is just around the corner, the date doesn't pressure either bargaining party because it's during the off-season. Clifton says the issue might not be ripe until July, when camp opens. "It would be pretty challenging to get something done by March, simply because there's a lot of moving parts," he says. "There are 32 different owners. There are approximately 1,500 union members, and among that group, there are diverging interests. Younger players, middle-of-the-road players and veteran players have different agendas."

Clifton expects the negotiations to continue because of a shared goal. "The commonality on both sides is that they want to continue the game and they don't want there to be an interruption come next season," he says. "I don't think you will miss any part of next season."

Ashley Post

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