NFL labor dispute could come down to owners, players compromising on $800 million revenue split and judge's oversight
Tuesday, March 8, 2011; 12:18 AM
The NFL's labor negotiations resumed Monday with the league and the players' union close to $800 million apart on the central economic issue of how to divide the sport's annual revenue, according to sources familiar with the deliberations.
If there is to be a settlement this week, it probably would have to involve a tradeoff between the two sides on the revenue split under a salary cap system and another key issue: whether a federal court judge in Minneapolis would continue to oversee the sport's labor deal, said sources from throughout the sport, who spoke on the condition of anonymity because the discussions are at a sensitive stage.
A settlement, if it is to be completed by the new bargaining deadline Friday, also would be likely to include an 18-game regular season that would be accompanied by reductions in offseason workouts and perhaps other concessions to the players, and a version of a rookie wage scale less restrictive than the NFL originally sought, the sources said. They cautioned that all the elements of a potential deal still could change as negotiations progress this week.
They also said that because the league and union remain so far apart on the major issue of how to divide revenue, there remains a significant possibility that the two sides will be unable to complete a settlement this week. That could result in a confrontation, with players decertifying the union and filing antitrust litigation against the sport's franchise owners, and the owners locking out players. The two sides also could extend their deadline again.
Some bargaining progress was made Thursday, according to sources. The league and union, negotiating under the supervision of federal mediator George H. Cohen, agreed to postpone by 24 hours their original bargaining deadline of 11:59 p.m. Thursday, then agreed Friday to a seven-day extension of talks.
Talks resumed Monday afternoon at the downtown Washington offices of the Federal Mediation and Conciliation Service. Cohen is the agency's director.
"Players will work their butts off - same as past [two] years - to get this done," George Atallah, the union's assistant executive director of external affairs, wrote Monday on Twitter.
Participants in the bargaining have adhered to Cohen's request that the negotiators refrain from public comments about the details of the talks. But sources with knowledge of last week's developments said over the weekend and Monday that the optimism sparked by last week's postponements resulted mainly because there was some bargaining movement, not because that movement was particularly substantial.
Various sources said there was modest movement on the revenue-split issue. They put the remaining difference at between $750 million and $800 million per year.
Under the current labor deal, owners are credited with about $1.3 billion per year for expenses before the players' portion of the sport's approximately $9 billion in annual revenues is calculated. The league originally sought another $1 billion annual credit for owners before the players take their cut. The union rejected that proposal, saying it would amount to a pay cut for players not justified by the sport's economic conditions.
That gap was narrowed a bit last week but remains sizable, according to sources. Another major stumbling block this week, the sources said, is that the union continues to seek extensive financial data about team finances, while NFL negotiators remain reluctant to provide it.
Several sources said the two sides probably cannot reach a compromise on the division of revenue unless they couple it with another bargaining issue. That issue, the sources said, could be the continued oversight of the sport's labor situation by U.S. District Judge David S. Doty.
Doty has overseen the labor deal since 1993. Last week, Doty ruled that the structure of the league's television contracts violated the settlement agreement and wrote that he would hold a hearing to determine damages and remedies, including an injunction. That could jeopardize the owners' ability to receive their approximately $4 billion in TV rights fees from the networks next season if there is a lockout.
The owners view the exclusion of Doty from future involvement as a major issue in these negotiations and would be unlikely to agree to any settlement that includes his continued oversight of the collective bargaining agreement, sources said.
One possible tradeoff this week, multiple sources said, was for the league to essentially buy off the future exclusion of such oversight by making a major concession to the players on the revenue split.