This paper examines collective bargaining in professional sports through the lens of human resources management. It argues that despite the apparent adversarial nature of negotiations between players unions and team owners, collective bargaining ultimately functions as a beneficial mechanism for both parties. The paper traces the historical rise of players unions, analyzes the role of owner cartels and restraint systems such as the reserve clause, and explores how strikes arise from labor mobility restrictions. Drawing on the bilateral monopoly model, the paper concludes that professional sports operate as a de facto cartel in which collective bargaining enables mutual market dominance rather than undermining organizational success.
Both corporations and unions agree that effective success hinges on the role that human resources departments play in the organization (Stratton-Devine, 1992). Without HR professionals to effectively manage the human factor in an organization, organizational success is quite unlikely. In the professional sports industry, this reality is significantly complicated by near-monopolistic control of players and their industry mobility by owners, and near-monopolistic control of the labor market by the players unions. In order to resolve the conflicts that inevitably arise in such a situation, professional sports have repeatedly turned to collective bargaining as a means to negotiate some satisfaction for each side. In essence, the union contract between owners and players in professional sports is formally known as the collective bargaining agreement (Covell et al., 2007).
Professional sports are big businesses, and because the product produced is the aptitude of individual athletes, it is easy to see how human resources would play an important role in determining the success of a particular team within this setting. However, the situation is complicated somewhat by the fact that professional sports does not consist of an open labor market. The HR professional in this field would be quite unable to simply hire the best person for the job, but would instead be limited by the restrictions placed on such choices by the players unions and the strictures set by the team and the leagues (Cappelli and Crocker-Hefter, 1996).
Human resources in professional sports must manage all aspects of personnel management, including one of the most contentious issues that finds its way to the collective bargaining table: the movement of players between teams (Besack, 1997). Accordingly, we are forced to ask ourselves whether collective bargaining, no matter how necessary, is an organizational advantage or disadvantage from the human resources perspective. Because collective bargaining inevitably fans conflict between players and owners, it can be viewed as too contentious to contribute to organizational success. On the other hand, it is one of the only mediums through which differences can be successfully resolved. This paper argues that collective bargaining, far from being a hindrance from the human resources perspective, is actually an incredible boon because it allows two powerful groups in a de facto monopolized industry to work together to their mutual benefit and the overall success of the organization. That some conflict inevitably arises out of this process is unavoidable; the reality is that collective bargaining ultimately strengthens professional sports.
Collective bargaining emerged in the United States as a powerful social force in the post-World War II years. At that point in U.S. history, collective bargaining was intimately tied up with the emerging authority of labor unions, which had progressive, even socialist, goals for labor relations in the United States (Brown, 1997–98). It is little wonder, then, that collective bargaining took on new importance in professional sports at around the same time, since it was during the 1950s–1970s that players unions began to grow in authority within the sports industry and exert greater control in the face of former market dominance by team and league owners.
Collective bargaining consists of the negotiations that occur between employers and employees over the terms of labor agreeable to all parties. In terms of professional sports, this means that owners and players negotiate the nature of their relationship and settle issues such as how much each player will be paid, what work will be expected for that payment, and other related matters. Collective bargaining is the means by which these two groups, seemingly in conflict with one another's interests, can reach relatively amicable working arrangements (Covell et al., 2007).
Collective bargaining can act as the proverbial glue that holds together players and owners. Obviously, both groups have their own interests at heart and desire to improve their labor situation, possibly at the expense of the other group. If the fundamental working relationship between players and owners is significantly strained to begin with, it could make the role of the human resources professional that much more difficult, as collective bargaining efforts will be similarly strained. However, when management and unions learn to effectively cooperate and work together during the negotiation process, collective bargaining can form an important component in the overall productivity of the workplace environment (Covell et al., 2007).
Collective bargaining between players unions and owners is complex and full of negotiating tactics designed to force the other's hand or create impossible situations. In general, players lobby for higher salaries and more freedom of movement within the industry, while owners want to restrict spending on players and maximize their control and profits (Marantz, 1994). An obvious inherent dilemma in this seemingly combative relationship is that these goals are mutually exclusive. Thus, one disadvantage of collective bargaining, especially from the HR perspective, is that it purposefully pits employers and employees against one another. One side threatens to lock players out of stadiums and the other threatens to strike for the season. Navigating this kind of conflict and resolving it so that each side retains a sense of dignity and does not feel cheated can obviously be a significant challenge. Nonetheless, when the HR professional is able to successfully facilitate the collective bargaining process, the overall gains for the organization as a whole are significant. Once compromises and concessions have been determined, the HR professional can return to the everyday activities of managing an active workforce in a dynamic industry.
Traditionally, owners of professional sports teams have determined the terms under which individual players will be employed by the team. This reality has changed somewhat in recent decades as players unions have increasingly worked with owners to collectively maximize gains. However, owners have collectively decided how their product — professional sports games — will be offered to the public and under what specific conditions. To enforce this, owners have controlled the formation and development of distinct sports leagues, bargained over advertising revenue and contracts, and decided how overall profits will be divided among owners (Adams and Brock, 1997).
In the early years, owners used contractual obligations like the reserve clause to control players — a stipulation that placed near-absolute control over a player's career in the hands of the team that first signed the player. To additionally protect their own interests, owners have enjoyed territorial benefits that grant them unfettered control over games played in their hometown. Finally, owners have operated as a single, effective cartel because they practice revenue sharing. Rather than working in direct competition with one another, individual owners operate in conjunction with each other to collectively maximize their own profits (Adams and Brock, 1997).
"Rise of players unions and collective labor power"
"Strikes as tools shaped by player restraint systems"
"Cartel dynamics driving owner-player collusion"
"Collective bargaining as mutual benefit, not hindrance"
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