Sports League Monopsonies and Social Justice: Bargaining for a Voice
Image Source: Lakers Daily
The NBA and NFL are leagues that have defined American sports for decades, drawing millions of fans domestically and worldwide. Modern NFL and NBA athletes have pushed beyond the court and the gridiron and have become figures of significant cultural and social influence. Many athletes use their personal brands to fight for social justice.
Lebron James has been a vocal critic of systemic oppression without major repercussions from the National Basketball Association. In 2012, Lebron and the Miami heat wore hoodies to protest the death of Trayvon Martin, whom a community watch member targeted due to his hoodie. In 2014, Lebron and the Cleveland Cavaliers wore t-shits saying, “I CAN’T BREATHE”, in response to the death of Eric Garner, who was put into a chokehold by a police officer. Furthermore, he has participated in collaborative social initiatives such as More Than A Vote, which aimed to promote voter participation during the pivotal 2020 election. From his work, Lebron has not only garnered recognition from fellow players but respect from the league, with the current NBA commissioner Adam Silver stating:
“There is this direct through-line from players like Bill Russell, here it was roughly 50 years ago, to LeBron…I just conclude by saying, I’m really proud.”
San Francisco 49ers quarterback Colin Kaepernick knelt to the US national anthem during a preseason game in 2016. The protest was in response to the systemic oppression faced by Black people in US society. Since 2016, he has not played a single snap at the professional level.
Although two different players in different leagues, they embody a deep contrast between the empowerment that NBA and NFL players experience. NBA players have, throughout league history, been voices for social justice. However, NFL players face more repression from expressing their opinions, with detrimental consequences, such as those faced by Kaepernick. Even though the problem is complex, a common reason for this contrast is the lack of high-paying guaranteed contracts for NFL players, which limits their ability to speak their minds openly.
The Monopsonies of the NBA and NFL
The NBA and NFL operate as monopsonies. A pure monopsony occurs when there is only one buyer among multiple sellers in a market. The classic example of a monopsony is a mining town, where one source of employment gives the mine owners bargaining power to determine the salary workers can obtain. In reality, no monopsony market is pure because workers can still move out of town and find other sources of income. NFL and NBA players have fought for, with varying degrees of success in different periods, the ability to move.
Before the 1970s, NBA teams held most of the bargaining power in contract negotiations. Teams held a reserve clause over players which meant that if a player was signed to them, they had no choice but to negotiate future contracts with the team that initially hired their services. If a team offered a player a contract lower than they felt they were worth, there was nothing they could do about it. Subsequently, players were only paid 27% of the league’s revenue, just over half of what modern NBA players earn today.
Image Source: NBA
The growth of the American Basketball Association (ABA) from 1967-1976 and the work of the National Basketball Player’s Association (NBPA) led by Oscar Robertson (seen above) levelled the playing field for NBA players. The ABA was a rival league to the NBA that was garnering more fans and revenue. Events such as the slam dunk contest and in-game statistics such as the standard box score of points, rebounds and assists were innovations that boosted the appeal of basketball to commercial audiences. Seeing the ABA's success, the NBA planned a merger, which Oscar Robertson only allowed if the NBA permitted players to switch teams. And so, in 1976, the merger happened, and at the same time, the free agency began, which allowed players to switch teams based on their preferences. Teams could no longer had a hold on their players, and so to attract them, they had to offer higher salaries. It was estimated that players earned nearly 50% of team revenue within a decade. A further benefit is that all of these contracts were fully guaranteed, meaning that if a player was to get injured or get fired, the team is still obligated to fulfil the contracts that they had signed.
Image Source: NFLPA
The NFL’s fight for bargaining power has been more tumultuous than other leagues. In 1956, the NFL formed the NFLPA, led by John Mackey (seen above); however, unlike the NBPA, it was not fully recognised as an actual union during its inception. Similar to the NBA, the NFL faced competition for player talent from the American Football League (AFL), which allowed players to choose between leagues based on which one offered better contracts and benefits. Although the variety of opportunities was not the same as the NBA, it improved from the previous system. The fight for flexible free agency in the NFL only occurred in 1993 alongside a new deal that increased players' salaries by 38%. The fight for player salaries between the NFL and NFLPA involved multiple strikes, lockouts and litigation that has severely strained their relationship. Furthermore, unlike the NBA, contracts are still nonguaranteed, meaning that if a player was to underperform or get fired, the team is not obligated to pay their entire negotiated salary.
Another variable that makes NBA player salaries high is the size of individual team rosters. The NFL has nearly 1700 players on active rosters, with 53 active players per team. In contrast, the NBA has 450 players, with 15 players per team. This makes the salary split much smaller for NFL players than for NBA players. The average salary for an NBA player in 2021 was 7.3 million dollars, while the average salary for an NFL player was less than a third at 2.1 million dollars.
The low and nonguaranteed contracts, in combination with the tumultuous history between the NFL and the NFLPA, places American Football players in a more compromised position to express their views on social issues. The cost of angering a largely conservative group of team owners with a track record of opposing player’s rights is partly why NFL athletes have hesitated to speak out.
Niven (2020) investigated the impact of a player protesting on their future in the league. The sample of NFL players was divided into those who protested social injustice and those who did not protest social issues. Factors such as individual and team performance were controlled. The results showed that all players received a pay cut in 2017. However, players who participated in protests lost 30% of their guaranteed money, while players who did not protest lost 22% of their guaranteed money. Compared to the NBA, whose players get much higher fully guaranteed contracts, the opportunity cost of protesting is significantly larger.
The cost of speaking out is too much for some athletes, which pressures them not to speak at all. A unique issue that the modern NBA player rarely experiences. Three-time pro bowl defensive back Deangelo Hall said in response to player activism in the NFL:
“I love my family and my kids and the financial stability I have more than anything in this world.’ And so, to jeopardise that for them, it’s going to take a lot for me to do that… If you had a guy making $100 million in the NFL and it was a fully guaranteed contract, he’d probably be able to voice his opinion on several social issues,”