photo: Marvin Miller
The Cardinal Nation’s series highlighting the history of labor struggles in MLB continues with multiple contentious CBA negotiations and the 1981 strike. Author Marilyn Green is a retired attorney with background in employment law.
As outlined in Part 9 of this series, the end of the decade of the 1970s brought huge gains for the MLB Players Association with the right to free agency granted by arbitration decision and a new Basic Agreement that gave new rights to players. The gains came at a cost as the decade turned over and more negotiations for a new Basic Agreement were underway.
The last Agreement of the 1970s expired on New Year’s Eve 1979. As that date approached, it was clear from the increasingly tense relationship between the union and the owners that a major showdown was looming. The owners remained defiant in the wake of their setbacks from the prior Agreement. The owners strongly resented what they felt was interference in their business by the MLBPA and they were dead set on clawing back some of what they lost in the 1976 Basic Agreement.
In anticipation of the upcoming negotiations, the owners voted to assemble a “strike fund” of $3.5 million generated by 2% of the gate receipts from the previous season. The owners also procured strike insurance from Lloyd’s of London. In response, the union set aside $1 million from licensing revenues for their own emergency fund.
Commissioner Bowie Kuhn took the bold step of meeting with MLBPA head Marvin Miller for the purpose of extracting some kind of promise from Miller to “throw” the upcoming negotiations on the basis of an alleged payroll crisis for the owners. Miller of course refused, in words that were less than refined, according to Kuhn. The request served one purpose, that of a warning signal to the union that a war was on the horizon.
Miller saw these negotiations as likely the last before he retired, and his resolve was hardened even more than usual. He dismissed Kuhn’s claim of owner poverty as laughable. As the end of the year neared, Miller made his demands clear; the players wanted a lowering of free agency eligibility to four years, a pension boost, a raise of the minimum salary to $40,000 and an elimination of the five-year waiting time for a repeat free agency.
The owners countered, via their new negotiator Ray Grebey, with draconian demands for the end of salary arbitration, a pay scale for players with less than six years of service, and more compensation for loss of free agent players in the form of replacement players from the signing teams.
The MLBPA responded to what they considered outrageous demands with a strike date of April 1, 1980. The owners dropped their demand for a salary scale shortly after. Nevertheless, the owners persisted in publicly crying poverty, even at the risk of an NLRB complaint and subpoenas to open their books to back up their claims.
Despite the bluster from both sides, by the end of March both the union and the owners agreed to submit their disputes to nonbinding arbitration. The MLBPA offered to remove the strike threat on the condition that the owners committed to bargaining in good faith on all issues except free agent compensation. That issue would be punted until the negotiations on the next Basic Agreement.
The union’s offer was rejected by the owners. As initially promised, the players walked out of their spring training camps on April 1. The cancellation of regular season games was a virtual certainty. The MLBPA made one last offer, that they would the resume the regular schedule as long as an agreement was reached by May 22. If no agreement was reached, they would walk out again on May 23.
The negotiations, facilitated by arbitrator Ken Moffett, descended into a standoff over the issue of free agent compensation. Moffett suspended the talks twice for a cooling off period. In the early morning hours of May 23, Miller and Grebey agreed to a one-year interim agreement. The agreement sketched out raises in the minimum salary and increased pension contributions. Free agent compensation was assigned to a study group that would issue a report at the end of the year.
In addition, if no final agreement was reached by February 19, 1981, the owners would have the power to unilaterally impose their last offer on free agent compensation. The union would have until March 1, 1981 to file a formal objection and then vote on a strike to take place no later than June 1, 1981.
The union ratified the interim agreement and the 1980 season proceeded as scheduled. The joint study committee accomplished nothing by the end of the year deadline. Further negotiations in early 1981 also were fruitless. On February 19, the owners’ free agent compensation plan took effect. The players reported for spring training and played out the schedule, with a strike date of May 29.
The MLBPA filed an NLRB grievance over the owner’s claims of poverty and a request for injunction for the owners to open their books was filed in federal court. The filing caused a postponement of the strike date. However, on June 10 the federal judge denied the injunction. The players went out on strike on June 12, 1981.
Negotiations for a final agreement resumed but only three meetings took place in the first week of the strike. Miller, always a lightning rod for the owners, withdrew from the negotiations to try to cool things off. He was replaced by players Mark Belanger, Doug DeCinces, Bob Boone, and Steve Rogers as well as union counsel Don Fehr.
Miller returned to the talks on July 1. The All-Star Game, set for July 14, was postponed. The U.S Secretary of Labor asserted himself into the negotiations at the request of one of the owners. Still no agreement was reached but there was some momentum for a proposal by the union for pooled compensation as opposed to compensation from the signing team. By the end of July an agreement was reached on pooled compensation.
The strike lasted 50 days, 712 games were cancelled, and the season was split into two halves. The union ratified the agreement on August 2. Principals were Kuhn, Grebey, Orioles owner Edward Bennett Williams, and Astros owner John McMullen for the owners. For the union, Miller, Moss, and Fehr were principals.
The agreement was for four years with an expiration date of December 31, 1984. The provisions were:
- Free agent eligibility remained at six years.
- Teams losing free agents would receive compensation from a pool of players with rankings as Type A and Type B players. The players in the pool are from unprotected players from the rosters of teams that sign free agents. In addition to a pool player, the losing team receives a draft pick.
- Salary arbitration remains at two years of service time.
- Minimum salary raises: $30,000 (1980), $32,500 (1981), $33,500 (1982), $35,000 (1983), and $40,000 (1984).
- Right to demand trade remains the same as prior agreement.
- Pension contributions raised to $15.5 million.
Marvin Miller, who rescued the MLBPA from obscurity and built the union into what it remains to this day, retired at the end of 1982. He remained on in a consulting capacity for new Executive Director Kenneth Moffett, the federal arbitrator who had facilitated the 1981 Agreement. Even before Miller officially stepped down, rumors circulated that the owners, with the ink still fresh on the Basic Agreement, were already colluding to keep free agent salaries down.
The reign of Moffett began poorly and was short-lived. He refused Miller’s counsel and would not relocate to the offices in New York. Though Miller had contracted to consult, Moffett locked him out of the MLBPA offices. Moffett gave the players every indication that he was not going to work hard for them, so in September 1983, the Executive Committee voted to fire Moffett.
Miller returned temporarily to guide the MLPA until a new Executive Director was hired. The MLBPA decided on assistant counsel Donald Fehr as acting director, and he was made the official Executive Director in December 1985.
The other side was going through a transition as well. Bowie Kuhn, who had held the office of Commissioner since 1969, fell into disfavor. The owners were unhappy over Kuhn’s handling of the 1981 strike, and when Kuhn declared war on some players for their drug use, suspending four Kansas City Royals players for one year without the due process required in MLB’s Joint Drug Policy, the owners had enough. The suspensions were overturned by an arbitrator and Kuhn was out the door.
New commissioner Peter Ueberroth was selected by the owners in March 1984, but did not officially take office until October. Negotiations were underway for a new Basic Agreement with the expiration of the existing Agreement set for December 31. As usual, talks were tense and moving at a snail’s pace. Ueberroth was met with a potential umpire’s strike upon taking his post but was able to avert that by granting raises to the umpires. His entry into the snake pit of Basic Agreement talks would not be so easy.
Owners were once again claiming poverty but unlike in prior years, they suddenly announced in February 1985 a willingness to open their books to the union. Knowing it would take time to go through the voluminous documents, the union agreed to start the season on time while continuing the negotiations. However, on June 4, Fehr announced that a strike would be called if no agreement was reached by August 6.
In mid-June, the economics expert hired by the union to examine the owners’ finances issued a report that basically said baseball was in good shape financially with robust growth, but that players’ salaries had declined substantially. Unsurprisingly, the owners responded with their own expert who reported that baseball was heading for a huge financial loss.
The two sides were at a stalemate. When games concluded on August 6, the players went on strike. This was the shortest stoppage in baseball history, as two days later an agreement was announced. The cancelled games would be made up in doubleheaders.
The new Basic Agreement was a five-year agreement to expire on December 31, 1989. Principals to the agreement were Ueberroth, Committee Chairman Lee McPhail, and General Counsel Barry Rona for the owners. The union was represented by Fehr, Associate General Counsel Gene Orza, and Special Assistant to the Executive Director Mark Belanger.
The provisions were:
- Free Agency – The free agent draft was eliminated, allowing free agents to negotiate with all clubs.
- Free Agency Compensation – Player compensation was eliminated. Compensation would be draft picks only.
- Salary Arbitration – Service time for arbitration was raised to three years beginning in 1987.
- Drug Testing – The parties agree to create an independent committee to oversee player drug issues and discipline. The union retained the right to challenge disciplinary action through grievance.
- Minimum salary – Increase to $60,000 with cost of living adjustments in subsequent seasons. Minimum is $62,500 for 1987 and 1988 and $68,000 for 1989.
- The players receive a cut of World Series pool.
- League Championship Series will remain at seven games through the end of the Agreement.
- Pension – Increase in owner contribution to $33 million each year from 1985-88. Increase to $39 million in 1989.
The media declared this Agreement to be another victory for the union. Many players saw it differently and were upset that they had given up the additional year for arbitration. Mistrust in Fehr began to grow. The 1985 Agreement was never put in writing.
The owners were even more unhappy. Their unhappiness led them to do something over the next several years that resulted in one of the greatest scandals in baseball since the Black Sox scandal in 1919 one that would be costly to its perpetrators.
To be continued…
Prior articles in this series
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