Why is there a Major League Baseball lockout? It’s a question that’s been on the minds of fans for weeks. The answer, unfortunately, is a bit complicated.
On March 27, 2020, Major League Baseball (MLB) announced that it would be indefinitely suspending all spring training games and delaying the start of the 2020 regular season due to the COVID-19 pandemic. The announcement came just hours after the NBA suspended its own season following a positive coronavirus test by a player on the Utah Jazz. On April 1, MLB Commissioner Rob Manfred announced that the 2020 season would be delayed until further notice.
The following day, MLB and the MLB Players Association (MLBPA) came to an agreement on a number of key issues related to how they would operate during the season. However, one key issue remained unresolved: how to split revenue generated during the season. The impasse led to negotiations breaking down and, on June 30, Manfred announced that there would be no baseball in 2020 unless the players agreed to a 50-game regular season.
The players rejected Manfred’s proposal, instead opting to file a grievance against him and the MLB owners for unilaterally imposing new economic terms for the season. The MLBPA also accused Manfred of not doing enough to prevent COVID-19 from spreading among players and personnel. On July 16, after months of negotiations and rhetoric from both sides, it was announced that there would be a 60-game regular season beginning in late July/early August.
The Economics of Baseball
The current Major League Baseball lockout is a result of failed negotiations between team owners and the Major League Baseball Players Association over how to split up the league’s $9 billion in annual revenue. The two sides are far apart on how to divvy up the money, with the players seeking a larger share than they received in the last labor deal. The owners, meanwhile, are looking to cut payrolls and increase their profits.
The Business of Baseball
Baseball has been called America’s pastime, and while that may be true, it is also big business. In fact, Major League Baseball (MLB) is a billion-dollar industry. And like any other business, there are times when the owners and the players can’t see eye to eye on how to divide up the profits. That’s what has led to the current MLB lockout.
The lockout began on December 1, 1994, when the MLBPA (Major League Baseball Players Association) went on strike. The strike lasted 32 days, making it the shortest work stoppage in MLB history. But it also led to the cancellation of 948 games, including the1994 World Series. That was the first time the World Series had been cancelled since 1904.
The owners and players finally came to an agreement on January 11, 1995. But the agreement didn’t last long. In 2002, there was another lockout that lasted from September 16 to November 24. That one resulted in the cancellation of 1,084 games, including the entire postseason.
The most recent lockout began on October 30, 2011 and ended on January 16, 2012. That one was even longer than the 2002 lockout, lasting a total of 161 days. But thankfully, no games were cancelled this time around.
So why do these lockouts keep happening? It all comes down to money. The owners want to make more money, and the players want a bigger piece of the pie. The owners say they need to make more money because their costs are increasing while their revenues are stagnating or even declining. The players argue that they shouldn’t have to take a pay cut when team values are soaring and MLB revenues are at an all-time high.
It’s a tough negotiation because both sides have valid points. But at the end of the day, someone has to give in if they want to avoid another costly lockout in baseball’s future.
Baseball’s Antitrust Exemption
Few fans of America’s pastime know that baseball is the only professional sport in the United States that is exempt from antitrust laws. The exemption allows Major League Baseball (MLB) to monopolize the market for professional baseball players and charge exorbitant prices for tickets and broadcasts. But lately, the exemption has been under attack by fans and lawmakers who say it’s time for baseball to compete on a level playing field.
The antitrust exemption dates back to 1922, when the U.S. Supreme Court ruled that baseball was not interstate commerce and therefore not subject to federal antitrust laws. The ruling meant that MLB could prevent players from competing for teams in other leagues and could block the sale of team franchises to anyone outside the league. MLB has used its monopoly power to keep player salaries artificially low and ticket prices high.
In recent years, there have been two major lockouts in MLB: one in 1994 that canceled the World Series, and another in 2002 that caused the cancellation of spring training games. In both cases, team owners cited rising player salaries as the main reason for their actions. And in both cases, it was fans who suffered the most, as they were deprived of their favorite pastime during the summer months.
With another potential lockout looming on the horizon, fans are once again bracing for the worst. But this time around, there is a new movement afoot to finally repeal baseball’s antitrust exemption. A bill was introduced in Congress last year that would do just that, and it has garnered support from both Democrats and Republicans.
Time will tell if this latest effort to level the playing field will be successful. But one thing is certain: without antitrust laws, baseball will continue to be ruled by a handful of wealthy team owners who care more about their bottom line than they do about the fans who make their sport possible.
The Collective Bargaining Process
A lockout is when an employer refuses to allow employees to work. A lockout can happen for a number of reasons, but in the case of Major League Baseball, it is because the owners and the players are not able to come to an agreement on a new Collective Bargaining Agreement. The current CBA expires on December 1st, 2021, and the two sides have been unable to come to an agreement on a new one.
The History of Collective Bargaining in MLB
The history of collective bargaining in Major League Baseball (MLB) can be traced back to the late 1800s, when players first began to form unions. In 1885, the first players’ union was formed, and two years later, the first strike occurred. This strike was short-lived, however, and by 1902, the union had disbanded.
Players continued to unsuccessfully attempt to unionize throughout the early 1900s. It wasn’t until 1953 that another players’ union was successfully formed – the Major League Baseball Players Association (MLBPA). The MLBPA is responsible for negotiating contracts between MLB players and team owners.
Since its formation, the MLBPA has been involved in a number of high-profile labor disputes with MLB team owners. The most notable of these disputes was the 1981 Major League Baseball strike, which led to the cancellation of 713 games and caused significant damage to the relationship between players and owners.
In 1994, another work stoppage occurred when MLB owners implemented a salary cap without consulting with the MLBPA. This action led to a 232-day strike that cancelled that year’s World Series.
The most recent labor dispute occurred in 2011 when negotiations between MLB owners and the MLBPA broke down regarding a new collective bargaining agreement (CBA). As a result of this impasse, all spring training games were cancelled and Opening Day was pushed back from April 1 to April 4. Ultimately, a new CBA was reached and baseball resumed without any further delay.
The current CBA expires on December 1st 2021, meaning that another labor dispute could occur in the near future if a new agreement is not reached before then.
The Current Collective Bargaining Agreement
The current collective bargaining agreement between Major League Baseball and the Major League Baseball Players Association expires on December 1, 2016. The two parties have been negotiating a new agreement for several months, but have so far been unable to reach an agreement. If a new agreement is not reached by December 1, 2016, there will be a lockout of MLB players.
A lockout is when an employer (in this case, MLB) prevents its employees (MLB players) from working. A lockout can happen for a number of reasons, but in the case of MLB, it would likely happen because the owners and MLB are unable to agree on how to divide the revenue generated by the sport. If there is a lockout, it would mean that MLB players would not be able to play baseball until a new collective bargaining agreement is reached.
The last time there was a lockout in MLB was in 1994-95. That lockout lasted for 232 days and resulted in the cancellation of 948 games, including the 1994 World Series. That lockout ended when the owners and MLBPA agreed to a new collective bargaining agreement.
The Owners’ Proposals
The primary face of the 1994-95 baseball strike was not a player, but acting Commissioner Bud Selig. Technically, Selig was not the commissioner; he had taken over for Fay Vincent in September 1992 and had been given the title of “acting Commissioner.” This was because MLB’s owners did not want to pay Vincent a severance package (worth about $7 million) if they were going to fire him. So, instead, they put Selig in charge and let him do the job of firing Vincent without having to pay the severance. MLB’s owners were also unhappy with how Vincent had ruled on a few key issues, such as the Pittsburgh Pirates’ use of television revenue sharing to finance player salaries.
In March 1994, Selig formed a committee to study baseball’s economic problems and come up with some solutions. The committee consisted of Selig, Jerry Reinsdorf of the Chicago White Sox, Bill Giles of the Philadelphia Phillies, and George Steinbrenner of the New York Yankees. This group met several times over the next few months and eventually came up with a set of proposals for changes in baseball’s economic system.
The first proposal called for a luxury tax on teams with high payrolls. The tax would start at 20% on team payrolls over $44 million and increase to 34% on team payrolls over $50 million. The second proposal was for a revenue sharing plan in which teams would share local revenues (such as ticket sales, concessions, and television contracts) with other teams in an effort to level the playing field financially. The third proposal was for a salary cap, which would limit each team’s total payroll to a set amount.
The owners presented these proposals to the Players Association in July 1994. The Players Association rejected all three proposals outright. They then proposed their own set of changes, which focused on increasing revenue sharing between teams and creating two tiers of players—one that would be paid at or near market value and another that would be paid at or near minimum wage—but the owners rejected these proposals as well.
The Players’ Proposals
The players’ union has proposed a salary cap at $50 million per team, with the exception of four teams that could exceed that amount. The union has also proposed that each team have a minimum payroll of $40 million. In addition, the union proposed that players receive between 49 and 51 percent of all baseball revenues. Currently, they receive about 36 percent.
The Impact of the Lockout
The lockout has impacted the game of baseball at all levels. Professional baseball players have not been the only ones affected; minor league players, aspiring young athletes, and even fans have all been caught in the crossfire. The economic impact of the lockout has been widespread, with businesses across America feeling the pinch.
The MLB lockout began on September 16, 1994, when the owners of the league’s 28 teams voted to suspend operations. The owners had been dissatisfied with the current state of professional baseball for some time. They felt that player salaries were too high and that they were not receiving a fair share of revenue from television contracts and ticket sales. The owners also believed that baseball was losing popularity to other sports, such as basketball and football.
In an effort to force the players to agree to their terms, the owners locked them out of spring training facilities and prevented them from signing new contracts. The players responded by filing a lawsuit against the MLB, alleging that the lockout was illegal under antitrust laws. A federal judge agreed with the players and issued an injunction that lifted the lockout on April 2, 1995.
Despite the injunction, there was no movement towards a resolution between the two sides and on August 12, 1995, Federal mediator William J. Usery Jr. declared that talks had reached an impasse. On September 14, 1995, with no end to the lockout in sight, MLBPA executive director Donald Fehr announced that the players would vote on whether or not to strike. On October 18, 1995, after months of fruitless negotiations, 95% of MLBPA members voted in favor of a strike.
The strike lasted for 232 days and forced the cancellation of 948 games, as well as the entire postseason. It was one of the longest work stoppages in professional sports history and caused immense damage to baseball’s reputation. Many fans turned their backs on the sport altogether and it took years for baseball to recover its lost popularity.
While both sides suffered during the lockout, it was ultimately Players’ Association executive director Don Fehr who emerged victorious. Fehr successfully negotiated a new collective bargaining agreement that resulted in significant salary increases for players, as well as increased revenue sharing between owners and players. The agreement also included a luxury tax on teams with high payrolls which helped level the playing field between small-market and large-market teams.
The MLB lockout is a dispute between the Major League Baseball players and the owners of the teams. The lockout began on September 16, 1994, when the Major League Baseball Players Association (MLBPA) filed a grievance against the owners, claiming they were not negotiating in good faith. On November 7, 1995, an injunction was issued, ordering the players to return to work. The injunction was overturned on appeal, and on March 31, 1996, the players went on strike. The strike ended on April 2, 1996, when a binding arbitration panel ruled in favor of the owners.