NFL union leader paints bleak picture of future with lockout
Smith did not hesitate.
“On a scale of 1 to 10,” Smith said Thursday, “it’s a 14.”
With that, the executive director of the NFL Players Association painted perhaps the bleakest picture yet regarding prospects of labor strife in the league, which could be looking at a 2010 season with no salary cap and, if the collective bargaining agreement expires as scheduled in March 2011, a lockout that year.
“I keep coming back to an economic model in America that is unparalleled,” said Smith, who often repeated phrases for emphasis. “And that makes it incredibly difficult to then come to players and say, on average, each of you needs to take a $340,000 pay cut to save the National Football League. Tough sell. Tough sell.”
Smith said the NFL would receive $5 billion from its network television deals even if no games are played in 2011. He regarded that as proof owners are preparing for a lockout.
“Has any one of the prior deals included $5 billion to not play football?” Smith asked, referring to previous contracts that were extended or redone. “The answer’s no.”
Some of Smith’s nearly hour-long question-and-answer session during Super Bowl week was spent reiterating past claims, such as team values increasing “almost 500 percent” over the last 15 years. There was also a call to have all 32 NFL teams open their books to show who was losing money and how much.
Smith also said he wanted teams to contribute what, ultimately, would be millions into what he called “a legacy fund” that would better support retired players.
Most of his focus, however, was on getting a new CBA.
“I really and truly in my heart believe we’ll get a deal done,” NFLPA president Kevin Mawae(notes) said. “But there’s going to have to be some give and some take and not just taking from one side all the way.”
The league’s response, in part, said that teams like the Green Bay Packers— whose audited financial statements are the only ones the union said it has seen — have had a 40 percent decline in profits.
“In most businesses, that would be a serious cause for concern,” said Jeff Pash, the NFL’s executive vice president and chief counsel. “It would indicate a serious issue that has to be dealt with. You look at your single largest expense, which is player costs.”
“I think as a player, I feel we have a pretty good thing going right now in the NFL,” Manning said Thursday. “It would a shame for something to have to change along those lines. I understand kind of like when a player is holding out or a player contract, there is a business side of this that can be tough. It is not always pretty.”
Smith said the latest NFL offer to the players would reduce their share to 41 percent of applied revenues from about 59 percent. He emphasized that the teams take $1 billion off the top of the estimated $8 billion the league generates.
Pash argued that the $1 billion reflects actual costs incurred, money “invested in things like NFL Network, NFL.com, putting games on overseas, all of which is intended to and has in fact had the effect of generating substantial additional revenues, 50 percent of which go to NFL players. And the union knows that’s true, because the union has absolute rights to audit those expenses.”
Echoing NFL commissioner Roger Goodell, Pash said Smith’s assertion that players are being asked to accept an 18 percent pay cut—the $340,000 per-player-average figure—was among the “misrepresentations of what our proposal is.”
“We have never said it would result in players having to take a reduction,” Pash said. “The entire point here is to generate a pool of resources to have continued investment and continued growth, which would lead to higher salaries and benefits for players.”
For now, some players say they’re bracing for issues. Mawae said he even has recommended players save 25 percent of their salary next season “in the event of a lockout,” though he noted “we can’t make all 1,900 players save their money.”
“We’ve told them, `Don’t go out and buy a new boat. Don’t go out and buy a new car. Pay off whatever debts you have,’ ” said Jeff Saturday(notes) of the Indianapolis Colts. “These are things we’ve been learning from history.”
Smith and Mawae said that if next season goes forward with no salary cap, it would be highly unlikely to have a new CBA with a cap reinstated.
“Virtually impossible,” Smith said.
“A very difficult task,” Mawae said.
Asked about the owners’ assertion that the 18 percent pay cut request was false, Mawae said did not hold back:
“That is not true,” he said. “That is absolutely true they’ve asked for 18 percent.”
Meantime, the union is increasing dues for now with the idea of returning the money as income to players, if needed, during a lockout.
“Our guys get it,” Mawae said. “Our guys understand.”