MLB players support Arizona bill exempting them from minimum wage
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The Arizona House has given preliminary approval to a bill that would exempt minor league baseball players from the state’s minimum wage law. Similar laws have already been approved in California and Florida.
The exemption would apply to minor leaguers while they’re playing in Arizona — think spring training, instructional league, or a number of other instances.
Both Major League Baseball and the players support the measure, although some legislative Democrats have come out in opposition.
Chris Deubert is the senior counsel with the labor employment law firm of Constangy, Brooks, Smith and Prophete, where he specializes in sports, litigation, labor and employment. He talked with The Show about the collective bargaining agreement and it being a big reason why both the players and MLB are pushing for this exemption.
Full interview
CHRIS DEUBERT: Yes. And, and so going backward, Major League Baseball clubs and their players have been in a collective bargaining relationship for almost 60 years, and they've, they've negotiated multiple collective bargaining agreements over, over that time pursuant to federal labor law. But only in the last two years have minor league baseball players also unionized and are also now represented by the Major League Baseball Players Association, and they executed their first-ever collective borrowing agreement with Major League Baseball last year. And that's because Major League Baseball, through a variety of other agreements, controls, substantially controls minor league baseball.
BRODIE: So why would the players not want to be subject to minimum wage laws?
DEUBERT: Yeah, and so going backward, there's, there's, there was important litigation in 2015. A minor league baseball player commenced [a] class action lawsuit against Major League Baseball, Minor League Baseball clubs alleging that they had been deprived of, essentially of minimum wage, and overtime to which they thought they were entitled under federal law and, and state law. The federal law being the, the Fair Labor Standards Act, which is a New Deal-era law meant to protect workers. And that case ultimately settled really only last year for about $185 million in damages. But in that process, Major League Baseball successfully lobbied Congress to exempt minor league baseball players from the Fair Labor Standards Act. So that helped them on the federal level, but minor league baseball players were still, you know, subject or controlled or had rights under state, minimum wage and overtime law. And so when they reach, when they did the new collective bargaining agreement or their first ever collective bargain agreement, they jointly agreed to lobby the states to exempt minor league baseball players from their their minimum wage and hour laws.
BRODIE: Well, so if the players are subject to the minimum wage laws in a given state, for example, in Arizona, is that a less good deal for the players? Like, do they earn less money that way?
DEUBERT: That is, sort of remains to be seen. I, I think the math may, you know, I think Arizona has a $15 an hour minimum wage. So, which is, you know, towards the high end, where some, some states are certainly lower. But you have to look at it in the big picture, which is now this collective bargain agreement is the full agreement hasn't been released. Collective bargaining agreements in sports are usually several hundred pages long and they govern a wide range of terms and conditions of an athlete's employment. And there are a variety of tradeoffs in there between the players and the league and the clubs. And the general consensus is that, you know, the players in league need to work together to grow the pie revenue because they are splitting that pie. And now that they have a unionized structure and an agreement that sets forth minimum salaries and a variety of other benefits such as housing and, and daily stipends and, and health insurance, life insurance, those kinds of things, the players themselves can make a determination as to what they want to bargain for. And, and what maybe non-cash items are, are more important to them.
BRODIE: So, is it fair to say then that the union is supporting this exemption because it's part of the collective bargaining agreement? Basically, they, and, and MLB and the owners basically said, look, we'll, we'll both lobby for this to happen, even though for some of the players, it might mean less pay.
DEUBERT: So, it's again, important, important context here which is, you know, New Deal legislation, minimum wage and hour laws, wage and hour laws are meant to protect the most vulnerable workers. But that is not the case with minor league baseball players. They are represented by the Major League Baseball Players Association, which is one of the most powerful unions in the country, not just in sports, in the country. They've existed for 60-plus years. They've litigated against Major League Baseball and its very wealthy ownership groups for, for that entire time. They've, they've had numerous lawsuits, arbitrations. They've won hundreds of millions of dollars in damages from Major League Baseball owners in the past.
They've had exemplary leadership and outside counsel and they two and they still do to this day. They are more than capable of defending themselves, and the union, I think fairly so, believes that they can do a better job of representing these players and determining what is in their interests than say a state Legislature or the state judiciary system.
BRODIE: So some critics of this are saying that it could potentially set a dangerous precedent to exempt a particular group from the minimum wage law. What do you think of that argument? Like, do, do you think they have a point there?
DEUBERT: Respectfully, no, I don't. I think they're ill-informed. California already has legislation that permits exemptions from certain wage and hour laws for unionized employees. Even, even to the extent it is a special case, it's a very different type of worker and a different type of union. These these minor league players right now, for sure, many of them are earning fairly low wages and salaries, you know, somewhere between $20,000 or $50,000 or something, but they also have the potential of earning millions of dollars and, and many of them may have received very large signing bonuses already. The average unionized worker does not have that kind of upside and they do not have the kind of union representation that these players do.
BRODIE: I mean, the majority of minor league players though, never make it to the majors. So I, I wonder if, you know, for those people who sort of toil away for years in the minors and, and never make it to the big leagues, could something like this potentially hurt them even though they have the Major League Players Union, you know, having their back.
DEUBERT: Well, so they were already the, the, the new CBA substantially increased salaries, I mean, more than, more than doubled them, in many respects. The league and the teams were not without defenses in terms of their, their compliance with these laws and, and to step back, one of the, one of the major problems of the application of these laws to sports is recordkeeping requirements. Your average hourly worker enters every day, punches a clock, punches out at the end of the day. How does a baseball player do that when they're on the road for 10 or 14 days or something like that? And what, what time counts towards you know, work being, being employed versus time that they're just in a hotel or maybe doing things on their own.
So theoretically would some minor league baseball players be able to earn more under a strict application of state minimum wage and hour laws? Yes, it's certainly possible, but you have to look at the entire package of benefits in the CBA is, is in terms of how it, it benefits them. You know, the CBA includes all types of versions in terms of improved medical care and facilities and education and language classes and, and lots of different things that will both substantially increase their chances of, of making major league baseball and also I think just improve them as professionals and individuals.
BRODIE: Chris Deubert is a senior counsel with the labor employment firm of Constangy, Brooks, Smith and Prophete, where he specializes in sports, litigation, labor and employment.
