Collective bargaining in sport: Power plays by the players’ union in the USL
The United Soccer League Players Association (USLPA), the trade union representing players in the United Soccer League (USL), is preventing USL Championship clubs from signing international players by refusing to sign “no objection” letters approving these signings.
The decision to place a hold on issuing these letters is a significant power play by the USLPA, with the players’ union currently negotiating a first collective bargaining agreement (CBA) with the USL and with these talks progressing at what the union will consider an unacceptably slow pace.
Furthermore, the USLPA and the Communications Workers of America (CWA), the largest communications and media trade union in the United States, have recently announced a partnership, aimed at assisting the players’ union in concluding a CBA with the USL.
Jeff Rueter covered these matters in detail for the website The Athletic, and his reports, published on 5 December and 8 December 2020, have been closely relied on in this piece.
It seems likely that the USLPA’s decision to place a hold on these letters, and the assistance it is receiving from the CWA, will have the effect of expediting the collective bargaining process. Perhaps the union’s actions will induce an agreement being reached before the 2021 season begins, which is usually in March annually. The league is now in its preseason.
A CBA would set minimum pay and would introduce other employment terms and conditions, as well as formalise those which have been established by practice. In the absence of a CBA, these employment terms are currently not standardised and there is great variance in players’ contractual terms across the USL.
In the vast majority of prominent professional sports leagues worldwide, minimum terms and conditions of employment are determined through collective bargaining or consensus seeking efforts.
Generally, a CBA entered into between the collective representatives of players and their employers contains standard employment contracts and a host of terms and policy provisions. Minimum salaries are set in this manner, as are players’ benefits and protections such as health and injury insurance.
Where does the USL fit into soccer in the US?
The USL is the governing body of the leagues in the US’ soccer pyramid which are below the top tier Major League Soccer (MLS).
The 32 team USL Championship is in Division II of the pyramid, which is the second tier of the structures.
It is unclear from the reports whether the CBA being negotiated will cover only the USL Championship, or the other lower leagues within the USL, in addition.
The US soccer pyramid operates in a “franchise” system, without promotion and relegation, which is typical of professional sports leagues in the country.
To give an indication of the profile of the USL Championship globally, most South African football fans would not recognise many of the players and those they would recognise are likely to be in the twilight of their careers.
There are, however, high-profile figures in world football involved in the league in an ownership and management capacity.
Examples include Landon Donovan, who is the executive vice president of soccer operations and head coach of San Diego Loyal SC, Didier Drogba, who is a part-owner of Phoenix Rising FC, which is where he ended his playing career, and Ex-Manchester United player Tim Howard, who wears the hats of goalkeeper, sporting director and minority owner of Memphis 901 FC.
The USL Championship, which was established in 2011, is ascending in terms of its prominence and commercial pull. The league has especially gained momentum since its competitor, formerly also of Division II, the North American Soccer League (NASL) folded, in 2017.
In July 2020, Forbes published an in-depth piece on the USL, with a focus on its growth and the characters who are leading its development.
How are the union backing the league into a corner?
The USLPA’s refusal to sign these letters, which was communicated by the players’ union to the USL on 1 September 2020, is a source of considerable power in the hands of the union.
The USLPA is preventing clubs from signing international players who are not already in “the USL ecosystem” or contracted to clubs in USL League One, which is the third-tier league.
Where a sports league in the US has a players’ union, professional athletes seeking a “P1 visa” must obtain a letter of no objection from the union. In the absence of a union, this falls within the purview of the league.
These letters prove that the union has reviewed a player’s situation and that it believes that the signing will not adversely affect US workers’ wages or working conditions.
Clubs can have seven international players contracted in 2021 and according to a club executive source who spoke to The Athletic, fifty to one hundred of these places would ordinarily be filled this offseason.
An important and US-specific element and consequence of the USLPA’s decision is that, as reported by The Athletic, while this refusal to issue the letters prevails, clubs will be unable to execute conditional “pre-contracts” with international players entering the MLS SuperDraft.
Such pre-contracts are a commonly used tool by USL clubs for players unlikely to be selected in the first round of the draft. They consummate if MLS teams do not ultimately sign the drafted players.
The importance of a CBA and the hurdles standing in the way of one being concluded
The USL and USLPA have been negotiating their first CBA for over two years.
Two seasons have now passed since the USL voluntarily recognised the USLPA, without an agreement in place.
The parties’ first bargaining session took place in February 2019 and talks have moved extremely slowly, with months between proposals, at times.
According to The Athletic, two “tenets” are central to any agreement.
The first of these is the introduction of a standardised length of contract, with it being understood that a ten-month contractual term is the most likely request by the USLPA.
Secondly, setting minimum compensation is central to an agreement being reached, with it being understood that this is “compensation”, including housing and insurance, as opposed to merely “salary”. In South African terms, this correlates to the distinction between “remuneration” – which by definition includes payment in money or in kind – and “salary”.
With reference to the Covid-19-related return-to-play talks between the parties, Rueter reported that $2 000 per month appears to be a potential starting point for negotiations on minimum compensation.
The Athletic reported in 2018 on the instances of unsatisfactory operational practices and contractual terms in the USL Championship.
New York Red Bulls II, the affiliate of the MLS team, for example, was reported to be paying players based on timesheets and teams were using “no-wage” contracts – akin to “zero-hours” contracts. There was also a reported lack of health insurance cover.
To further illustrate the current profile and commercial status of the league and the relative vulnerability of the players, the 2019 minimum annual salary for senior players in the MLS was $70 250, whereas some USL players earn below $1 000 per month in terms of guaranteed income, as reported by The Athletic.
By way of comparison, according to the Spotrac website, the 2020 minimum annual salary for NFL players is $610 000 and for NBA players, $898 000.
Once Covid-19 entered the picture, the CBA negotiations were put on ice so the parties could focus on discussing the return to play. It was agreed at that time that bargaining sessions were to be held every two weeks until a deal was reached.
The USLPA first communicated the possibility of placing a hold on the letters in January 2020 and then on 1 September, it notified the clubs that it would do so, stating that this was due to the perceived lack of urgency on the league’s part in negotiating a CBA.
The USLPA executive committee has stated that concluding a CBA for 2021 is imperative for the USL ecosystem and for the growth of the league.
Comparative player power and the union’s resourcefulness
The player power of USL footballers is a world away from the sway held by professional sportspeople in the most prominent competitions globally.
The tale of NBA superstar James Harden is a topical comparator in terms of the opposite end of the spectrum of player power and influence. The NBA is a league where the top players at times appear to have supreme influence, as individuals, over franchise leadership.
As reported by ESPN, Harden has had allowances made for him in terms of compliance with standards of conduct and team etiquette by his employer, the Houston Rockets, and is able to push the limits of acceptable conduct without fear of reproach. He has reportedly had effective power in terms of hiring and firing of players and coaches and in setting travel and training schedules. The Rockets are now bearing the brunt of the freedom apparently afforded to him and the status he has been given within the organisation.
The team appears to be intent on either retaining the services of their most renowned and highest-paid player, who has shown little commitment to the cause, or on achieving the difficult objective of maximising his value – to an extent reflective of his considerable market value – whilst he has effectively reduced the Rockets’ leverage through his apparent keenness to be traded elsewhere.
Closer to home, an apposite comparison is the manner in which the fortunes of Western Province Rugby are, in the view of the writer, closely linked in a number of respects to the presence of its most prominent players, including captain Siya Kolisi.
The necessity, in the writer’s view, of these players committing to staying in Cape Town for the medium- to long-term – in the face of significant off-field uncertainty – is consistent with the extent to which Western Province’s on-field and commercial performance is tied into these players being present, with them being amongst its most important and valuable assets, in a commercial and sporting sense. This gives these players scope for great leverage in seeking concessions of their employer, for example in contract negotiations.
The contrast in player power and the ability of the USLPA to exert pressure on the franchises by drying up international signings at a key time for the clubs, brings into sharp focus just how resourceful this move is by the union in seeking to achieve its aims of finalising a CBA.
The USLPA’s partnership with the Communications Workers of America
The USLPA and the trade union the CWA have announced a partnership, the primary aim of which is for the CWA to assist the players’ union in concluding a CBA.
The CWA, which is well established in the US labour market and represents hundreds of thousands of workers, has been communicating with the USLPA for a number of years.
As The Athletic reported, the CWA has extensive experience of these processes and has valuable resources to extend to the USLPA, such as career unionists as advocates in negotiations and a “massive” strike fund, which could be used to supplement players’ pay in the case a work stoppage.
The US has a long history of industrial action in professional sport. Most recently, in the NBA and NFL in 2011 and in the NHL in 2012, the franchise owners implemented lock-outs when they were unable to reach agreement on CBAs with the respective players’ unions.
Considering the relatively low pay received by USL players, access to the strike fund may be a significant factor making a strike feasible for the players. A potential strike could become an important factor in the negotiations.
In general, strikes can be disastrous for leagues and ownership, especially in reducing broadcast revenue or preventing it from being generated or earned. However, a strike would mainly hit USL franchises in the pocket through reducing matchday revenues.
As explained by Rueter in other reports for The Athletic, the USL is a “live-event business”, with the clubs particularly reliant on matchday revenues. The USL does have a broadcast deal in place with ESPN, but it is not as comparatively lucrative as we generally see in major sports leagues worldwide.
The CWA commented that first agreements of this nature are the most difficult to finalise, with the parties just getting to know one another, but it said that it considers anything in excess of a year of negotiations to be too long.
Partnering with the CWA shows further shrewd use of the resources available to the USLPA.
The relational consequences of the union’s actions and learnings in terms of collective bargaining
The players’ union’s actions at this time provide us with fascinating insights into approaches to collective bargaining in sport.
The hold placed on the letters is an exercise of power by a trade union whose members do not have the great bargaining power or commercial value we’ve become accustomed to in professional sport.
This move by the USLPA could well present a hurdle to cooperative engagements with the league and the USL franchises going forward, depending on how it is received and how the matter plays out from this point.
However, the USLPA’s actions may well foster a sense of respect for the union and its leadership within the leadership of the clubs, who might have previously deemed the union a soft touch, incapable of playing the negotiations game in a ruthless manner.
In this regard, the union’s partnership with the CWA should serve to further eradicate any perception on the USL’s part of a lack of fortitude or negotiating nous on the USLPA’s part, because the USLPA is now clearly well-heeled in terms of the resources necessary to push the USL into getting a deal done.
Despite the possible effects in damaging the relationship of trust between the parties, the USLPA will have deemed the refusal to issue the letters as a necessary “hardball” strategic decision to facilitate substantive improvements in the terms and conditions of employment of its members and to improve their job security.
It seems reasonable to expect that we will see news of a relatively swiftly concluded CBA in the coming months, perhaps before the scheduled start of the 2021 season.
Rueter reported that clubs, players and agents alike had expressed their frustration at the delays in the negotiations.
The USLPA’s approach – in placing a hold on the issuing of no objection letters – has drawn criticism from both sides of the sporting aisle.
The leadership of the clubs has referred to the USLPA’s decision as restricting its own workforce.
The Athletic quoted a player agent as referring to the hold on the letters as “antithetical to the purpose of a players union”.
As Rueter concluded in the first of his reports, the question now is whether the union’s actions will expedite the process of concluding a collective agreement before the 2021 season begins.
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