Five Key Points as MLB’s CBA Expires and Lockout Descends

·6 min read

As of 12:00 am ET Thursday, Major League Baseball and the Major League Baseball Players Association are operating without a collective bargaining agreement—a legal contract that sets out policies on wages, hours and other working conditions for MLB players. So what comes next?

The first step happened at 12:01 am ET when MLB locked out its players. News of the lockout became official at about 12:15 am ET when MLB posted a letter to fans from MLB commissioner Rob Manfred. Manfred defended the lockout as a “defensive” move intended to “jumpstart the negotiations and get us to an agreement that will allow the season to start on time.” He also expressed frustration with MLBPA for what he described as an unwillingness to compromise.

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By instituting a lockout, the league has initiated a work stoppage and instructed teams to exclude players from their employment. Players, in other words, are barred from team activities and facilities until they make what MLB would regard as sufficient concessions in negotiations on a new CBA.

While the labor dispute involves multiple issues, a core one is MLB seeking enhanced measures to punish teams that choose to have high payrolls. The league, as the multiemployer bargaining unit for the 30 ownership groups, wants to deter all owners from high spending. Despite a luxury tax system, some owners are willing to spend dramatically more than others. Per Spotrac, the Los Angeles Dodgers had the highest payroll with $271 million in 2021 while the Baltimore Orioles had the lowest, $42 million. Under labor law, the players, through MLBPA, would need to agree to any new restraints or penalties on team spending. The MLBPA naturally objects to measures that would limit opportunities for players to earn higher salaries.

A lockout is management’s version of a strike, which involves players withholding their services in hopes of extracting bargaining concessions from management. In labor law, both are “weapons” designed to pressure the other side to capitulate. Both, generally, are lawful. And both have been used in MLB labor disputes.

As MLB enters this period of détente, here are five points to keep in mind.

First, a lockout wasn’t necessary. Under the labor law principle of status quo, the terms of an expired CBA continue in effect until there is a new agreement or an impasse in negotiations. There are even some examples of this in pro sports. The CBA between the U.S. Men’s National Soccer Team and U.S. Soccer, for example, expired a few years ago. However, the two sides have continued to operate as normal while negotiating a new agreement. If MLB believed negotiations were advancing, it could have punted on a lockout. Manfred’s letter indicated that negotiations are not close to a deal.

Second, a lockout in December is less impactful than one would be in March. There are no MLB games in the winter, and under the uniform player contract, players generally are paid their salaries during the season. In 2002, MLB and MLBPA averted a lockout with a “last second” agreement in August, in the middle of a season, with games and paychecks on the line. The dynamic is much less dramatic this time around.

That’s not to say a lockout in December won’t prove disruptive. As Sportico’s Barry Bloom explained, player signings and other moves involving MLB players will be unavailable during a lockout. But there’s no risk of lost games for a while: Opening Day isn’t until Mar. 31, 2022.

Third, most labor disputes in baseball have been resolved within a month and have not led to game cancellations:

1972 Strike: 13 days (86 games lost)
1973 Lockout: 17 days
1976 Lockout: 17 days
1980 Strike: 8 days (92 spring training games lost)
1981 Strike: 50 days (713 games lost)
1985 Strike: 2 days
1990 Lockout: 32 days
1994-95 Strike: 232 days (938 games, including the 1994 World Series, lost)

A couple of entries on that list are worrisome, but most show the two sides have been able to bridge gaps without greatly disrupting their sport.

Fourth, the current labor dispute could eventually get messy and involve the legal system. This was the case in the 1994-95 strike, when the National Labor Relations Board obtained an injunction from a notable federal judge: future U.S. Supreme Court Justice Sonia Sotomayor. She compelled MLB to reinstate an expired CBA since the two sides were still negotiating. That labor dispute featured aspects unlikely to surface in 2021. MLB had, without MLBPA’s consent, imposed and then withdrawn a salary cap. The league also relied on replacement players during spring training in 1995. Those types of aggressive moves seem unlikely, especially since they proved counterproductive.

The MLBPA, for its part, has a right under the National Labor Relations Act to “disclaim interest” (a variation of decertification) in representing MLB players. That move would enable individual players to sue MLB and its teams under antitrust law. MLB enjoys an antitrust exemption, but the exemption was narrowed in relevant ways by the Curt Flood Act of 1998. “MLB players,” the Act explicitly clarified, “are covered under the antitrust laws [and] have the same rights under the antitrust laws as do other professional athletes.” MLB’s antitrust exemption remains in place for umpire-league matters, minor league baseball, the amateur draft, licensing of intellectual property, ownership sales and franchise relocation, but it does not apply for matters of MLB players’ compensation.

To be clear, decertification and antitrust litigation are unlikely and would face a high bar. NFL players tried that approach during the 2011 NFL Lockout. It failed, as reviewed by the U.S. Court of Appeals for the Eighth Circuit. But MLB players would likely have a different federal circuit, the Second, review the matter. It’s conceivable the review could prove more favorable. Still, both sides know that litigation would turn off fans and elongate their dispute.

Fifth, the MLB-MLBPA dispute arises at an interesting juncture in American labor relations. As reported by Bloomberg Law, there were almost double the number of strikes from August to October 2021 than there were during the same period in 2020. Labor feels emboldened given the shortage of workers in many industries. There’s a perception among some workers that management units have been penny-pinching—particularly as profits soar and inflation lowers the value of wages.

At the same time, labor disputes involving MLB players (and pro athletes in other major leagues) are dissimilar from the average worker in obvious and crucial ways. MLB players earn much more money than most unionized workers, with the average MLB salary a hearty $4.17 million. They also have relatively short windows of life to earn that money, with the average MLB career lasting about five or six years, in contrast to most workers, who spend decades in their fields. MLB players are also uniquely talented with nontransferable skills. They would be impossible to replace without a massive drop in quality of play.

On the other hand, MLB players have nowhere else in the U.S. to ply their trade at comparable salaries. They could seek employment in Japan and other countries with pro baseball leagues, but there are only so many slots to go around and most would pay less.

MLB players and MLB, in other words, need each other; that alone will lead to a resolution. The question, then, is a matter of when.

(The story was updated throughout to reflect the official imposition of a lockout.)

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