Over the course of the past year, one of the big questions hanging over the 2020 NFL season has been the status of a labor agreement between the players and the owners. With the current collective bargaining agreement set to expire after the 2020 season, there are several things set to be different for this upcoming season in the absence of a new agreement. On Thursday afternoon it began to look like an agreement could be reached on a new CBA that could potentially assure labor peace for the next decade.
Specifically, the owners voted to approve the proposal that had been reached following months of negotiations with the NFLPA.
The NFL has voted to approve the proposed new CBA. All eyes turn toward the players... https://t.co/PswxM5CEhG— Ian Rapoport (@RapSheet) February 20, 2020
Following the release of the statement by the league, details then began to work their way out, including the release of the proposal fact sheet.
The NFLPA has sent all players a fact sheet that covers the highlights on the current proposal for a new Collective Bargaining Agreement. A lot to go through here.. pic.twitter.com/tzOhyLOmhY— Darren Heitner (@DarrenHeitner) February 21, 2020
However, while that sheet contains a lot of bullet points that would benefit the players, the overwhelming majority of those bullet points are simply a rearrangement of the money allocated to the players. What the players do with their money once it is allocated by the owners - post-playing days healthcare, performance based pay increase, 5th year option guarantee status, injury protection increases and many of the other points are nothing more than moving money after it has been allocated to players.
So, while there was some support for the agreement among certain players, other players nearly immediately began pushing back.
So the NFL owners approve a new CBA proposal by a large majority today but the veteran players are wisely suspicious...why? pic.twitter.com/mfCgTnu4ka— Rod Babers (@rodbabers) February 21, 2020
Former Seattle Seahawks Richard Sherman and Russell Okung were both expected by many observers to be critical of the proposed CBA, and those predictions proved correct. That led to word coming out late Friday that the full unions would not even be voting after the Executive Committee of the NFLPA voted 6-5 against the proposal that had been negotiated.
#NFL’s CBA proposal is going to come down to one question: If the entire union populous weighs in and over 50-percent of players are in favor of the presented CBA, should a 32-member slate of player reps or a 6-5 “no” vote from the executive committee outweigh a popular majority?— Charles Robinson (@CharlesRobinson) February 21, 2020
Even Seahawks receiver Tyler Lockett chimed in on the no vote.
We say No https://t.co/1iR4uutDYA— Tyler Lockett (@TDLockett12) February 21, 2020
That then led many to question why the players would say no when the agreement included an increase in the minimum amount of revenue allocated to the players that would represent an increase of somewhere in the neighborhood of $175M per year going forward. The answer, simply, is that even with that large increase, the proposed CBA is still a significant step backwards from where the players were prior to getting obliterated in the negotiations for the current CBA. There seems to be no reason for the players to agree to an increase in the revenue floor that would keep that floor far below where it once was.
Seeing some questioning why there has been such a harsh reaction to the proposed CBA from some, in spite of a revenue share increase from 47% to 48% for the players.— John P. Gilbert (@JohnPGilbertNFL) February 21, 2020
This is why:
(source: https://t.co/KMqAsAAJFL ) pic.twitter.com/mzpGTmIomR
Now, certainly a rising tide lifts all boats, and the increase in revenue share from 47% to 48%(or 48.5%) for the players is good. That said, here are some rough calculations of what it would take for that extra 1.5% to work out to an additional $5B over the course of the next decade.
NFL revenue and player split projections
|Season||Revenue ($B)||Player Increase ($B)|
|Season||Revenue ($B)||Player Increase ($B)|
Even those projections, which assume aggressive 13% revenue growth over the next decade in order to reach an increase of $5B for the players, show the disparity in the split. If revenues indeed reach the levels towards the bottom of the table, then the revenues allocated to the owners would reach in excess of $28 billion per year. With 32 teams in the league, $28 billion for the owners to split winds up just under $900 million per owner per year, which is more than triple the amount the owners likely split from the 2019 season.
Now, team expenses are certain to increase over the next decade, but it seems unlikely that the owners will see their expenses triple. For example, from the public filings of the Green Bay Packers, we know that their non-player expenses increased from $111.6M in the final year of the prior CBA to $234.1M for the 2018 season, with those 2018 expenses including the Packers expenses related to their Titletown District development.
In short, owners, particularly those for teams which play in municipally owned stadiums such as the Seahawks, would see their profits skyrocket under the proposal as presented. There is, no doubt, plenty of wiggle room above the 48% proposed by the owners wherein they will remain profitable. Zero teams went bankrupt operating under the 2006 CBA when players were getting in excess of fifty percent of revenues, and with revenues having increased significantly, it seems unlikely that owners would be hurting at 49% or 50%.
Which explains why the players did not agree to proposed CBA.