Event Recap: NFLPA Executive Committee member Jim McFarland

Jim McFarland speaks to the Cornell ILR Sports Management Club

On Monday, April 8th, the ILRSMC hosted NFLPA Executive Committee member Jim McFarland. McFarland played college football at Nebraska University and enjoyed a six-year career in the NFL. He graduated from Cornell Law School in 1980 and has been practicing as an attorney ever since. In 2007, he was named to the NFLPA former players Board of Directors, and in 2010, he was made a former player representative on the NFL Executive Committee. He spoke with the club about the process of drafting a new CBA and the current troubles they are experiencing. A summary of the event can be found after the jump.

On the NFL’s massive popularity

McFarland began by explaining how the NFL’s popularity has helped increase revenues for all teams. This expanding revenue, however, has been difficult for owners and players to split up. In January, Forbes outlined the immense profitability of the NFL, Revenues and profits have risen dramatically over the years and they continue to rise. Football is even recession proof! 19 of the 32 NFL teams are currently worth at least one billion dollars. By comparison, only one other professional sports team - the New York Yankees - are worth one billion dollars.

On why the owners can afford a lockout

A decision tree was shown which detailed factors that are affecting the owners’ decision to pursue a lockout. The main issue for both the owners and their respective teams is maintaining a cash flow during the lockout. Due to contractual obligations, TV networks still need to pay the price of broadcasting games even if no games are played. Essentially, teams will still bring in some revenue during a lockout. However, the economic pitfalls of having no football in 2011 will be felt around America. Each NFL city could potentially lose 150 million dollars of revenue without a season.

On the structure of the NFLPA Executive Committee

The NFLPA Executive Committee has 12 members, including 10 active NFL players and 2 former players (including McFarland). As a former players representative, McFarland’s role on the committee is to advocate for retired players' benefits and for improvements in pensions.

On the 17-day mediation process in February

McFarland was present for 15 of the 17 days of mediation. He claimed, at first, that the talks looked promising, but eventually broke down. The talks started with issues that both sides agreed on, such as improving drug policies and limiting offseason training activities to protect against injuries. However, the major issue that split the parties was revenue sharing. The owners want the players to take a major decrease in their share, while the players feel they should not be given a smaller share as long as revenue is increasing. The players asked to see the financial documents from the owners that would show exactly why the players should accept less of the shared revenue. The owners refused, claiming the players already had enough evidence.

On the union decertification and subsequent class action lawsuit

The CBA was set to expire on March 3rd, but both parties voluntarily extended it to March 11th. Yet, after little progress, at 5PM EST on March 11th (before the CBA expired at midnight) the NFLPA announced its decertification as a union to become a trade association. Then, Tom Brady, along with 8 other active player plaintiffs and one college rookie (Von Miller of Texas A&M, now of the Denver Broncos) filed a class action lawsuit against the NFL for violation of antitrust laws. Due to its decertification, the NFLPA did not file the Brady et al. v. NFL lawsuit as a union. Instead, it served and continues to serve as an advisory trade association to the class of players. The NFL is insulated from the antitrust laws by an existing CBA negotiated by an existing Union.

On how the owners are affecting this process

McFarland emphasized that one of the major difficulties has been the diversity amongst owners. He claims that Commissioner Goodell has the troubling task of trying to represent 32 rich owners, all with different views. Even worse, they all have different schedules; during the 17-day mediation, the owners only met face-to-face with the NFLPA for about three hours. Every day, the owners had 4 PM conference calls, which resulted in them only being able to reach tentative agreements with the players during the daytime, prolonging the process.

Goodell doesn’t have the control or ability to make group decisions for these owners. Many of them come from different backgrounds and have vastly different views. McFarland claimed that there are three different types of owners in the NFL today. There are fully invested owners, like Jerry Jones of the Cowboys and Bob Kraft of the Patriots, who risk takers. They run their team like a business by investing in them and marketing to increase revenues. There are family owners, such as Clark Hunt of the Chiefs and Mike Brown of the Bengals, who inherited teams from their fathers. As owners of smaller market teams that are family business, these owners are less willing to invest in their teams and take financial risks. Finally, there are owners who treat their team as just another business venture and are still involved in other businesses. All of these different owners have different opinions about the logistics of the new CBA, making collective agreement a real challenge.

NFL Commissioner Roger Goodell

On key dates in the near future

NFL camps open around the middle of July, so McFarland claims that all parties hope the CBA is signed by this time. If not, there will be major consequences regarding advertising and revenues.

Key statistics stated by McFarland…

-The average NFL career is 3.4 years.

-The average NFL salary is about one million dollars.

-Over 80% of all NFL players are either bankrupt or divorced after 2 years of retiring.

-84% of players end their careers with injuries.

All of these stats support the idea that the new CBA must focus, in part, on players' lives after their careers are over.

On a rookie wage scale

The NFL wants a definite wage scale, meaning a player drafted in a specific draft spot would get a specific amount of money every time. The players favor a “pool” system. This entails a team being allotted a certain amount of money to give to all of their draft picks and the team must spread it out among its selections.

On whether or not NFL players are following the negotiations

McFarland claims that “110% of NFL players are following the negotiations.” Every team has a player representative, and these player representatives are directly involved with the NFLPA Executive Committee. Individual players have been told to contact their player representative to be briefed on the current situation. McFarland spoke about how he used to routinely contact Dan Dierdof, his player representative, during his playing years.

Thank you to Jim McFarland for taking the time to speak to our club.

The ILRSMC Blog will be covering the NFL Lockout throughout the summer.