Negotiation Case Studies July 9, 2009

Negotiations in the Spotlight: NFL vs. NFLPA

The NFL and NFL Players Association Negotiations

Soon, the National Football League (NFL) will be entering negotiations with the NFL Players Association (NFLPA). This will be a high-stakes negotiation, as football is the most popular and most profitable sport in the United States, making about $8 billion each year.

This will be the first negotiation between new NFLPA Executive Director DeMaurice Smith and NFL Commissioner Roger Goodell. (Read an interview with Smith in the Seattle Times here.)

Several items are on the table:

1. Collective bargaining agreement expires in 2009 and negotiations on extending the agreement began on June 1.
2. Players are seeking a larger portion of the league’s revenue streams.
3. Players’ salary cap is due to be removed in 2010.
4. NFLPA wants access to NFL financial accounting. Read full story on ESPN.com: http://sports.espn.go.com/nfl/news/story?id=4181186
5. Expanding the playing season (more games translates to more revenue).

The sour economy is playing a big role in this negotiation. Sponsorships have slowed and ticket sales are down. Players want to make more but team owners are claiming they are getting less revenue.

In a June 9 Forbes Magazine article, Tom Van Riper reports that these negotiations could escalate to a strike or lockout because each side is looking to establish its power.

In the article, Riper writes: “Goodell's biggest weapon for averting a strike: Convincing the players that it is the worst possible time for a stoppage given the recession. The last thing anyone wants is to antagonize an already stressed-out fan base by haggling over too many details.”

It seems that the recession could work in the NFL’s favor. It will be interesting to watch these negotiations unfold, and see how they affect other sports negotiations.