DeMaurice Smith Talks With Hogs Haven About Impending Labor Negotiations
As I sat down at the conference room table, the meeting was already in progress (hey, I got a 9-to-5). With my head down, I sunk into my chair and started to listen to what George Attallah (NFLPA Assistant Executive Director) had to say about the ongoing talks with the NFL owners. I had to do a double-take. The dude sounds exactly like Kevin Spacey. Exactly. It was like having Kaiser Soze himself lecturing on the state of the NFLPA. Awesome.
Before I even had enough time to nail which Kevin Spacey movie Atallah sounded most like (either American Beauty or Swimming with Sharks), DeMaurice Smith was in the room and we were getting the union's case presented to us in full color. I quickly discovered what had drawn so many members of the union to DeMaurice Smith. He does his best not to mix words and he spells out points in a way that make his angle seem like not just the most logical but also the most just.
We Meringolo's have long been pro-labor people. But this issue is going to be pretty messy before it gets cleaned up and solved. The NFLPA thought enough of Hogs Haven to bring Kevin and I in to educate us on the situation. Instead of taking sides at this point, perhaps it just makes sense to lay out as much of what we were told as possible so that we can all be a little better armed to make that decision when we are ready. Knowing is half the battle I am told.
Right away Smith told us that a lot of the player reps and their spouses/families were in town. "The strength of the PA is the wives. They ask the best questions and they have the kinds of issues on their minds that we spend our time dealing with: safety, security, stability." In fact this point was reiterated throughout the day, as players themselves confirmed that it was the wives and significant others who do a great job of raising topics up the flagpole and getting them addressed. According to DeMaurice, "1900 players translates into about 5200 'family people'" and they are as much a part of what the NFLPA is about as anything else. When a wife asks, "What happens to our health care in the event of a lockout?" it hits home.
"We don't spend a lot of time talking about the game of football here. We talk about the business of football. The game itself is neither the nature or tone of our discussions," said Smith, as he moved into a few finer points of what they deal with in their membership. "Just about 25% of our membership is out of football every year. It takes 3 seasons to get 5 years of health care [after you retire]. If you play less than 3 years you get no health care. The average NFL career is just over 3 seasons. So we are struggling just to get guys a very small amount of health care. Also take into consideration that for the average player who gets into the league around 22-23 years old and shuffles out at the age of 27 or so, his health care lasts him until he is 32 years old. Now, when do you think he needs health care coverage the most? When is is 30 years old or when he is 50 years old?"
We started to delve into more of what the owners and union were actually negotiating over. The owners want $1 billion "back" from the players in the next deal. This, according to the NFLPA, would put the union back into the late 1970's. That does not sit well with the union.
The TV contracts are a huge issue in all of this. You see, the NFL renegotiated their deals in the last few years. Apparently, they secured a provision from the networks that would essentially pay the NFL regardless of any lockout or football-less period of time. DeMaurice Smith was incredulous. They could not have gotten that deal from a bank. They could not have gotten that deal from an insurance company. The union is crying foul and they want to study the relevant contracts to dig deeper. Smith says, "All we care about is the truth. If the TV deals turn out to be a $4 billion dollar guarantee to the league to do absolutely nothing, then fine. We just want to know. But when you are the ones with the power to shut down the game, and you secure $4 billion in the event you shut it down...is that right?"
He went on to say, "In the last 15 years the average team has grown 500%. What business in America has grown 500% in 15 years? There are two measures of business success: Profit/cash flow and the more attractive and sustainable measure of success that is asset value. These NFL teams could capitalize their business for a 500% increase over where it was 15 years ago." We asked him how much do they really know about the TV deals? Smith answered, "We have been allowed to look at it in terms of revenue. We are not allowed to look at league or team profit data. We do not have access to all of the numbers necessary to calculate profit data. We are not partners to those contracts. We have been told by the league that their profit data is 'none of our business'."
At this, DeMaurice got indignant. "None of our business??!! Come on. You want $1 billion dollars from us. What if we gave them $1 billion dollars and in return the NFL gave us an equivalent value in Class B shares in the NFL? Make it so players can't cash them in until they turn 40 or so. It would help solve part of our pension problem. And it would put us squarely in line to benefit from the success which we are so essential to. The NFL said no to that idea. The NFL says that $25 billion is the revenue target for 2027. Everyone is incentivised to grow revenue--players and owners. Get both parties involved in growing the business, invested in the business."
The other main topic of the day was health and safety of the union's members. "There isn't a person out there who has not come to grips with not just the issue of concussions, but the nature of the way you treat them. We continue to brief members on the Hill every day. There is no uniform medical standard across the NFL for when a player is able to return and play. What do we do to make sure everyone has the same baseline standards for when a player is to return to play? I am very focused on the issue of disincentives to players for reporting injuries. Players need to feel safe to list injuries. I believe that Congress as well as every state and local official has an interest in occupational safety administration. When you peel back the luster of the NFL, they are more like other traditional labor unions. Do we have a safe place to work? Do we have a good deal or not with the owners?"
So we asked Smith: What's your level of optimism this can all get settled?
"I'm optimistic because our fans love football and the players want to play. It seems to me that 2 of the 3 necessary parties want to get it done. No one has said that teams are losing money. I am optimistic."
We pressed him on the individual matters of extending the season, increasing the rosters, rookie pay scale, etc. But Smith indicated that they simply could not afford to piecemeal this thing.
"Every now and then we slip into this discussion that this is a routine bargaining negotiation and it's not--they want us to go backwards. They want us to negotiate with blindfolds on by not showing the audited financials of the teams. If we increase to 18 games in the regular season, how is that going to change the vesting plan for health care? If we increase the rosters, what does that mean for the cap. Bye weeks are affected, the offseason is affected. The rookie pay scale is something we have proposed that gets instituted but we want to make sure that the money not getting paid to rookies goes to proven veterans. The NFL has not agreed to this. We are willing to contribute some of these monies to put into a fund to support retired players. The NFL did not want to do that. When we were in Indy and we all agreed that the rookie plans would save about $200 million. The players were content to send $100 million to retired veterans and the other $100 to proven veterans. It's the players' money. We are disagreeing on how you spend...OUR money? Huh?"
George Atallah put it simply: "We have told the agents to make the clients aware that they need to prepare for a lockout."
The best line of the day also came from George "Kaiser Soze" Atallah. He was talking about the sacrifices that the union was prepared to make if in fact things were as dire as some owners are indicating. "If football's gotta be saved, we'll save football."
Who wouldn't want that guy in his corner?
One final note: I simply could not let it go and had to ask an Albert Haynesworth-related question. Here is what I found out...the characterization by Haynesworth's agent that the NFLPA "advised" him on which moves to make and what was okay or not okay is simply incorrect. It turns out that Chad Speck (Albert's agent) played that up a bit. While the NFLPA did make them aware of certain consequences for certain actions, it was a) nothing they wouldn't have done for any other player; and b) not at all a situation where they advised Haynesworth to sit out. Let's just say they are less than pleased that the story was that the NFLPA advised Haynesworth on what to do.
Gird your loins sports fans. This ride promises to be bumpy. We will do our best to get an interview and present the opposing side when we can. I am sure Snyder will open his financials for me to study and report on.
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Twas very interesting and we don't normally understand the things the union is concerned with...
Because:
It’s not our bodies that take the beating and require health care, especially if the injury is a permanent damage thing.
It’s also not the OWNER’s bodies that take the beating and require health care because of the beatings.
It’s not our money….whether the owner’s make more money or the player’s make more money, it does not affect us.
All we want to do is to watch the games and BS about the trades/injuries/standings/players etc etc.
I hope for the sake of the players
they don’t have to negotiate with the guy who negotiated the NFL contract with the clause that says they get paid regardless if there is a game to video. Just sayin…
Time flies like an arrow. Fruit flies like a banana.
That's why they're trying to get Congress involved.
Hogs Haven. On Twitter. And Facebook.
by Kevin Ewoldt on Jul 21, 2010 2:31 PM EDT up reply actions
... Seriously?
League minimum pay is $325,000 for a rookie this year, it goes up every year (next year is $340,000). It also increases for each year of service, by roughly $75,000 a year. If an UDFA signs for the minimum, makes the roster, plays for three seasons and is cut and done, he has made well over a million dollars.
A million in the bank (well, after taxes, 3/4 of a million), three years after you graduate college. I don’t know any doctors, lawyers or anything else that can ever look forward to that, and that’s league MINIMUMS. These guys are making millions, and I’m supposed to be crying about their healthcare? Five years of high-end healthcare after a three-year career is more than I’d get in any field, no matter the danger of injury or ongoing physical problems. Combine that with the salary and I think the problem isn’t in the healthcare, but the failure of these kids getting these big paychecks to budget their money for the future. If they spent and budgeted responsibly, there’d be enough money to provide their own healthcare until they lined up a post-NFL career that has corporate healthcare available.
I’m not a big fan of unions in general, but especially this one. I understand they have some valid concerns, especially about the possibility of an 18 game season coming up and the wear and tear on players, concussion issues etc. Concentrate on that, and don’t try to sell me a sob story about your pensions and your HMOs when your union members are making $300k+ at LEAST every year, and you’re taking $15,000 from each one (1900 players * $15,000 = $28.5 million) in “dues” to pay your own fat cat asses.
You make a good point until you
stand it up against the insufferable greed of the owners and NFL, Inc.
Time flies like an arrow. Fruit flies like a banana.
couple things
I do normally tend to side with business in these sorts of issues; after all, you don’t go into business with the sole intention to help people, you do it to make money. That’s the American way, and I have no problem with responsibly maximizing profits.
I agree the NFL owners are exceptionally greedy, however (yeah, our team’s especially). They need to be kept in check, which is why I don’t completely reject the NFLPA. Thing is, Smith seems to be taking the same tack that other unions have, which is “You make $X from my labor, and I’m entitled to a Y% share of that profit.” I think that reasoning is flawed, and the market should determine what the labor is worth, not the results of the labor. If you can make a million bucks off of someone you can pay minimum wage, more power to you; personally, I’d give the guy a raise, but I wouldn’t feel obligated to do so.
Completely understand your position and for
the most part agree. One thing for sure, though, no one is looking out for the customer in this business. If you can imagine the “soldiers” in a drug cartel wanting to unionize and negotiate with the Boss, it makes a more credible analogy IMO then people trying to paint this as a comparison to the fight to unionize the mining industry a century ago. Why do I make that analogy? Because we are the addicts in the equation. More Kool-aide, please!
Time flies like an arrow. Fruit flies like a banana.
Seriously? Well said Tuckwell
I start with the simple idea that the NFL should have a good health insurance plan and provide good medical care. After all, it’s a job of “planned accidents”, and the cost must be relative chickenfeed compared to other expenses. But as Tuckwell said, it’s sort of goofy to be obsessing about a normal benefit like health insurance when you’re talking about guys making at least 5 times as much as normal people, amounts that dwarf any usual medical costs, and amounts that ought to make them financially secure forever. In terms of the negotiations, it ought to be easy for the NFL to be “generous” and give the union an “out”. So in that sense, union emphasis on the “wives’ health care concerns” could be encouraging for a settlement – they’re playing “small ball”. One other surprise – the tone was vastly different and better. Smith and Attallah, though still sounding inept and unfocused to me, dropped the bombastic drivel and hysteria they used before (about a lockout being certain). Also, as Tuckwell mentioned, they just blithely assume that they should get a lion’s share of the profits – rather than a “salary” or “pay”. That idea undercuts most of the usual labor issues. I.e., if you’re a “partner”, you pay your own benefits You can’t take half the profits, then turn around and make the other side pay you benefits like they do for a $10/hr guy. And it also clarifies what you’re negotiating about – the profit split – and the owners can thus demand a reasonable return on their investment. Just generally, the union argument is always undercut by the obscenely high “salaries” being paid already. On Haynesworth: I never read anything that suggested the union “advised” him, just that he checked the rules with the union.
Haynesworth's agent went out of way to muddy that water
The NFLPA folks were very clearly unhappy about it.
by Ken Meringolo on Jul 21, 2010 8:13 PM EDT up reply actions
My 2 cents
As a businessman, I clearly understand the side of the owners. But the NFL owners take greed to a new level. Someone correct me if I am wrong, but player salaries are based on a percentage of TV revenues only. All other revenues go to the owners.
As far as player salaries, NFL players play the most physical sport (compared to baseball, basketball, and hockey) and have the lowest salaries. Throw in the lack of base salary guaranteed contracts and a “career” of 3-4 years on average. There are bad B actors that make more annually and are able to work for their chosen profession for 20-40 years.
That being said. I just want to watch football.
Scott E, I am in line behind you at the treatment facility.
As Gordon Gekko said, "greed is good"
But maybe higher minimum salaries, with better longer term benefits, in recognition that it is a violent sport and most players only last a few years, would be a way to go. Less for the stars and first round draftees, more for the “little guys”. I can sympathize with the players some, because it is clear that the teams are totally ruthless. You get hurt, wham, you’re gone. It makes sense to “make it” while they can. So it is quite reasonable for the union to get the best deal they can, and don’t get sidetracked by cosmetic bennies. Good faith bargaining on both sides would be the ideal. In that context, I would think Snyder would be one of the reasonable ones.
What is wrong...
with the owners making an offer and if the players refuse…then just lock the players out until they accept the offer.
Nothing wrong with that. The owners own it. Are they greedy? Sure. But who wouldn’t be if you owned the Washington Redskins, Dallas Cowboys, Pittsburgh Steelers….etc.
Contracts are so out of hand (in all the pro sports it seems like) that the only way to solve that problem is a lockout.
The Once and Future King
Didn't anyone inform Mr. Smith...
What do the players have to worry about, in a couple years they’ll be retired and have Obamacare to take care of them…
Every time you lose you die a little; not all of your organs, a portion of you; maybe just your liver. ~~ George Allen
by rictorcreed on Jul 21, 2010 11:02 PM EDT via mobile reply actions
The Obama jokes were there all day
It was hard.
by Ken Meringolo on Jul 21, 2010 11:07 PM EDT up reply actions

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