Although I am not like any of the crazed fans of the National Football League, I will admit that it is a guilty pleasure and I love what football represents. Saying good-bye to the heat of summer, the return of cool, crisp afternoons. The rollercoaster of emotions as families and friends gather on Sundays. It is an American pastime that I truly embrace.
I am not alone, the Nielsen Co. estimates that 111 million people tuned into the Super Bowl last year and millions spend their Sundays, Mondays and Thursdays watching the new American past time. What does however escape me is the passion and obsession with fantasy football. It is estimated that 27 million people play fantasy football and I can’t even fathom the countless hours spent each week making trades and setting line-ups. It is something that I will never understand.
This past Sunday, as my beloved Philadelphia Eagles topped the Division in week two by beating the Baltimore Ravens by a point, there was a twelfth man on the field and it wasn’t the fans – it was the replacement refs. We cheered them during their holding call against the Ravens in the fourth quarter but then admonished them for their failure to correctly call the forward pass, claiming it was a fumble within the two-minute mark (thankfully, we have instant review). At that point I wondered what the replaced refs, sitting on the couch at home, were thinking. As an attorney, it instantly occurred to me. Rather than fantasy football, fantasy contract negotiations. You represent the NFL Referees Association and rather than collecting points for touchdowns and yards gained, as the negotiator you get points for working through mediation and getting your client back on the field.
I can’t imagine this being endorsed by the NFL, and rather than the millions who play fantasy football, I would guess that interest in my league would be significantly less.
The key question as the season progresses is what exactly is
holding up the refs from returning to their jobs? It is unfortunately an issue that transcends the NFL and is
a topic in almost every corporate boardroom and break room. While pay, staffing
levels and the way arbitration will be handled in the future have all been
discussed during their mediation, the issue which the refs have decided was
their breaking point was the issue of switching from a pension plan to a 401K
The NFL and ultimately the team owners are not alone in considering switching the way employee retirements are handled. Companies are increasingly moving away from the burdens of traditional pensions that our parents and grandparents have come to rely upon. They are moving towards 401(K) retirement plans. Why? Basically, it is to minimize funding uncertainty. This year corporate giants like Bank of America and General Motors have made similar moves as it relates to eliminating pension contributions. General Motors has reported that as of the middle of 2011, their US pensions were under funded by about $10.8 billion. GM is not the only one with under funded pensions – one just has to run through a list of Fortune 500 companies and state sponsored pensions. More so than ever, investors are carefully considering these burdens and stockholders are growing impatient.
So, is a 401(K) that bad? Teresa Ghilarducci, an economics professor at the New School and a leading critic of 401(k)’s, said, “Every good retirement system needs to have adequate accumulation for individuals, the money needs to be invested appropriately and the payout needs to meet the needs of retirees for life. Unfortunately, 401(k)’s fail in all three categories.” The NFL referees subscribe to this belief and that is exactly why we have replacements officiating the games. Fundamentally, moving from a pension to an alternative investment like a 401(K) shifts the risk of managing the investment from the NFL (or any other employer who offers retirement benefits) and places it upon the employee. That being said, some employees are happy with this shift. A 401(K) gives individuals control over their retirement assets including taking money with them when they change jobs.
So, will the refs return to the field anytime soon? Part of any good negotiators job is getting into the head of the other side and assessing the potential liabilities and risk if the other party is unwilling to meet your demands. In the case of the NFL, they know their risk resides in the court of public opinion. But regardless, the players will show up to play, ticket holders will be in their seats and fans will continue to buy merchandise – regardless of the quality of officiating. The NFL continues to hold a vastly superior bargaining position. And if corporate America gives us a window into the future, the refs will have to concede this point in order to return to work anytime soon. As such, the attorneys negotiating for the NFL Referees Association should advise their client to look to other areas that ground can be gained and get them back to doing what they do best – making the right calls.
Tags: "collective bargaining" contract retirement delaware employee pension employer negoiation