In the latest Weekly Wright Report:

• NFLPA Grievance Looks to Produce Historic Labor Law Result for Lamar Jackson

NFLPA Grievance Looks to Produce Historic Labor Law Result for Lamar Jackson

By Edward Healy

Dispute Background

The National Football League Players Association (the “NFLPA”) has filed a grievance alleging that NFL owners have colluded–in violation of the NFL collective bargaining agreement (the “CBA”)—to withhold fully-guaranteed contract offers from “top” players. Unlike other major professional sports leagues, the NFL does not have a blanket custom of fully-guaranteed contracts. The combination of Deshaun Watson’s recent fully-guaranteed deal and Lamar Jackson’s purported insistence on a fully-assured deal are clear indicators that elite players want that to change. The NFLPA contends their evidentiary basis stems from conversations amongst owners around the August 2022 owners’ meetings in Minneapolis. It claims that, as relief for this alleged conspiracy, “certain quarterbacks”—presumably those who have recently signed extensions, as well as Lamar Jackson—should be permitted to terminate their contracts.

The Rules of Collusion

Article 17 Section 1 of the 2020 NFL’s collective bargaining agreement (“CBA”) states that NFL clubs cannot enter “express or implied” agreements to restrict or limit Club’s from decisions such as (1) negotiating or not with a player, (2) offering a contract to a player or not, or (3) anything concerning the terms and conditions of employment. To win its grievance, the NFLPA would need to prove by a clear preponderance of the evidence that owners conspired to violate this provision and that a player was economically injured. Mere failure of a team to negotiate with or offer a contract to a player will not  meet this standard, even in combination with evidence of that player’s skills.

The Weaknesses of the NFLPA’s position

Proving an Agreement: Unless it produces a recording of incriminating conversation or some other “smoking gun,” the NFLPA will only likely be successful by arguing that owners reached an “implied” agreement to withhold fully-guaranteed offers. That argument will raise the question of what constitutes a collusive agreement to withhold such offers. Proving a conceptual concurrence among owners that fully-guaranteed contracts are a threat to the teams’ salary-cap accounting would likely fall short. Rather, to establish the alleged conspiracy, the NFLPA will probably need to produce specific evidence of a pact among owners to deny fully-guaranteed deals to the specific players identified in the grievance or other star players.

The Discretion Clause: One significant hurdle for the NFLPA is Article 17’s discretion clause which permits teams to refrain from negotiating with or not offering contracts to players so long as they do not fall into certain enumerated categories. Those enumerated categories in Article 17 Section 2 refer to contract statuses that would not seem to apply to Jackson’s case because, among other things, Jackson had not reached Unrestricted Free Agency or been designated as a Franchise Player at the time of filing. Thus, Article 17’s discretion clause suggests that an individual NFL team may have a policy of not offering fully guaranteed contracts to certain categories of players (veterans, extensions of rookie contracts, running quarterbacks, etc.) and that policy would not violate the CBA’s anti-collusion provision.

Fully Guaranteed Contracts Exist: Another hurdle for the NFLPA is that there are both collectively and non-collectively bargained fully guaranteed contract precedents in the NFL. The Franchise Tag and Transition Tag have been collectively bargained for and are mechanism’s designed for ‘top’ players. Additionally, all 32 2022 NFL first round draft picks – top players in their own right – signed fully guaranteed deals. While these examples are not directly on point, the NFL could make persuasive arguments that there is no general agreement against fully-guaranteed contracts and thus the NFLPA may be stuck arguing that particular teams conspired to withhold fully-assured deals from specific players.

Potential Scenarios for Lamar Jackson

Invoking Article 17, Section 8(a) of the CBA, the NFLPA claims that, to remedy the alleged collusion, certain quarterbacks should be given the option to terminate their current contract.

For Lamar Jackson to truly benefit from the grievance, the timing of the proceedings here is utterly crucial. Jackson is currently on an expiring contract – unlike the other quarterbacks referred to in the grievance – and will likely be franchise-tagged at its expiration. This contractual status could impact whether Jackson will hit the open market, should the NFLPA succeed on its complaint.

The plain language of the CBA states that termination rights “shall not arise” unless and until the System Arbitrator finds collusion and that decision’s appellate process has concluded.

Article 17, Section 8 (a) continues to say:

“If such player would have been an Unrestricted Free Agent…, such player shall immediately become an Unrestricted Free Agent upon such termination. If…such player would have been subject to a Club’s exclusive negotiating rights, such player shall remain subject to such rights upon such termination.”

If a potential appellate process concludes after February 21, 2023, Jackson is likely to have been franchise tagged and subject to the Ravens exclusive negotiating rights. Under the above rule, Jackson may still be subject the Ravens exclusive negotiating rights even if the System Arbitrator awards Jackson the right to terminate his contract. This means that Jackson’s best hope of benefitting from the NFLPA’s efforts is for the process to proceed as quickly as possible.

Having spent years in both an NFL Front Office and the NFL’s Management Council, Eddie Healy brings unique insights to the representation that he and the firm provide in contract matters generally and sports-law matters in particular.

If you have any questions contact Eddie at ehealy@wcslaw.com or any member of the Sports & Entertainment Law Group.