1994-95 Major League Baseball Conflict and Resolution

Nature of conflicts between the players union and the owners

The 1994-95 baseball strike is the biggest known strike to have occurred in professional sports. It resulted in the cancellation of 920 games and the championship series. This was the first cancellation of the game in 90 years. The strike started on August 12, 1994, and ended on April 2, 1995, taking 232 days. The strike led not only to the loss of money to the owners and players but also to the disenchantment of the fans. The baseball game conflict between the players and the owners dates from the 1970s. The players had been demanding better pay but their demands fell on deaf ears. Negotiations over contract terms between the owners and the union have been full of mistrust which has resulted in eight work stoppages in baseball. The 1994-95 famous baseball strike was sparked by a misunderstanding between the owners and the players over the salary deal. To keep expenditure low due to deteriorating financial conditions in baseball, the owners demanded a salary cap. The owners argued that unless the teams decided to increase fairness amongst them by sharing broadcasting revenues, small clubs would not survive. In January 1994, the owners developed a revenue-sharing plan based on a salary cap and requested players’ approval. The owners amended the previous Major league agreement which gave the commissioner full powers regarding labor negotiations. The players strongly opposed the sharing idea resulting in the standoff. The owners’ representative formally revealed the ownership suggestion in June 1994, which guaranteed $ 1 billion to cater for the salary and benefits of the players. The proposal also required the clubs to adjust their payrolls to a harmonized base structure. The baseball players’ association leader suspected mistrust of the offer and rejected it in July. He argued that the salary cap idea was a way to assist the owners to solve their problems and not to benefit the players (Filippelli & Reilly, 1990. p. 321).

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The Major League Baseball Players Association representative continued to agitate better terms for the players through negotiations. Due to great pressure from the players’ side, the owners decided to silence the players by withholding $7.8 million which was supposed to be paid to the players’ pension and benefit scheme as per the earlier agreement. This was a clear sign of mistrust on the side of the owners. The 1994-95 strike was ignited by the team owners’ decision in 1992 that were aimed at opening negotiations on salaries. The team owners’ tried to avert confrontation by requesting the players to enter into partnership with them and re-examine the rule that required three out of four votes for a lockout as opposed to just a simple majority. By these moves, the owners demonstrated their commitment to take a practical stand to promote change. A series of meetings were held thereafter without tangible results. The owners’ efforts to renegotiate become an exercise in vain. Lack of negotiations progress resulted to frustrations to the union and removed the opportunity to deliberate issues in a non-confrontational atmosphere. With the negotiation failure, the team owners agreed unanimously to share income with players in condition the players accepted a salary cap. The team owners intentions was to tackle the problem of salary inequality between players of the large teams in big cities such as New York, Chicago and Angeles with small teams from small towns such as Seattle, Milwaukee and Pittsburg. The decision to link revenue sharing with a salary cap was viewed by the players as an attempt to solve the income disparity of the owners, themselves. Imposing of a salary cap was to enforce a salary floor so that small teams would pay a certain maximum amount of salary. The small teams were in need of subsidy to meet the players’ minimum pay and at the same time reduce huge profits by big teams so that payment to its players would be reduced (Bennett, & Kaufman. 2007 pp. 156-158).

The concept of revenue sharing where the big teams were to fund small firms caused a stir between the owners of the teams on the way it could be best done. However, the plight of many small teams and a drastic fall in revenues from television contracts and gate collection caused the owners to scale down the player’s salaries resulting in a strike. The strike caused a considerably low attendance. This, in turn, made Major League Baseball suffer great losses in income. After the strike, fan attendance reduced significantly. Gate collections were the major income for the team owners and the players. Reduced fan attendance affected revenues negatively (Dietl, Lang & Rathke, 2008. p.226).

Methods of negotiation

Poor negotiation strategies and lack of trust between the negotiation teams always result in mistrust and collapse of the relationship between the negotiating teams. The work stoppages in baseball were triggered by a lack of trust in the allocation of revenue between the owners and the union through combined bargaining, the examination of shared gain through collaboration, the behavior of the negotiating parties at the negotiating table, and the ability of the negotiating teams to accommodate conflicting interests of the negotiating teams. Resource allocation is the hardest problem to solve in bargaining. For a long period, there has been no cooperation between the owners and the players in negotiation for common gain. Both parties have been locked in battles towards oppressing one another other than putting efforts towards increasing their income through mutual problem-solving. Issues concerning negotiations over money such as sharing of revenues and salary caps required creative arrangements that could provide stability in the game for increased revenues for all stakeholders. Trouble for baseball lied heavily on the bargaining atmosphere. Mistrust between the two parties and lack of commitment to the negotiation process (Lewicki, Barry, & Saunders, 2007. p. 145).

Dating back to 1960, the problem of mistrust between the owners and the players has persisted. The players have taken an adverse stand. The negotiations between the players and the owners have been characterized by mistrust, disrespect, finger-pointing, unaccommodating, and non-commitment by both parties towards finding a lasting solution to the standoff. To break the stalemate, each party should find its chief negotiator to negotiate with his party. Each negotiator should be able to resolve the varied interests of his party. The owners’ mediator should be able to reconcile their differences to have one stand while the bargainer for the players should as well reconcile the interests of the players so that they have a common stand. The baseball team owners for a long time had oppressed the prayers. They were taking the players as a milking cow. Low salaries and poor bargaining power was a recipe for the team owners. Any attempt by the players to be heard was unsuccessful. During strike, the owners’ receded on the use of salary caps, eliminated salary negotiations, and directed the negotiations to take place in the baseball commissioner’s office. The case eventually went to court. The players accused the team owners of unfair labor practices. The judge observed that the team owners were practicing unfair labor practices and had undermined collective bargaining. The judge restored the earlier agreement between the players and the owners. Through the judge’s ruling, both parties agreed to go back to the negotiation table and reach an agreement. The team owners proposed a 7-year contract which was aimed at dividing the total revenue between the players and the owners by half. This was a reduction of the earlier share of 56 percent. The strike caused a lot of damage to the club owners and the fans. By the time of the strike, players had already taken much of their pay. The owners lost a great deal as most of their revenues were pegged on three-fourths of the television incomes. The players also lost in terms of salary. The players rejected the offer and maintained they could not share the licensing revenue. The team owner’s negotiation strategy was to benefit the owners to the expense of the players (Raiffa, W. 1982. pp. 47-51).

Labor relations

Labor relations refer to the relationship between the employers and the workers especially those represented by the union. Labor relations can be in levels such as shop-floor, regional or national level. The sharing of powers among these levels affects the way the economy operates. The labor relation framework is set through regulation and legislation. Good labor relations should be able to adapt to change, whether technological, economic, or political. Labor relations can be looked at in three main theoretical perspectives according to the understanding and analysis of relations in workplaces. The approaches are unitarist, radical, and pluralist. The unitarist perceive the organization as an integrated whole where all employees are treated alike. The management and the workers mutually cooperate and share a common goal. The perspective emphasizes a managerial role and commands the loyalty of all workers. In this approach, labor relations and trade unions are of no use since the employees’ and the employers’ loyalty is perceived as mutually exclusive. Conflicts rarely occur and they are considered disruptive and cause communication breakdown (Lewicki, Barry, & Saunders, 2007. p.69).

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From a pluralist perspective, the organization is taken as being composed of powerful and different parties each with its legal loyalties, leadership, and goals to pursue. The two major parties to this perspective are the employers and the trade unions. The two subgroups hold different perspectives. In conflict resolution, the employers tend to lean more on persuasion and coordination and less towards controlling and enforcing. Trade unions are recognized as a genuine representatives of the workers. Work conflicts are resolved through collective bargaining where the two parties reach a mutual agreement. Conflict is not necessarily seen as unruliness and if well addressed can bring meaningful change. The radical perspective addresses industrial relations in a capitalistic manner. In this perspective, there is a primary division of interest between labor and capital. It perceives economic wealth and power inequalities as a result of the capitalistic system of an economy. Conflict is taken as the usual and inevitable way by the workers of addressing the concept of exploitation and oppression by capitalists. Labor unions concern themselves with collective bargaining on behalf of the workers with the employers on matters concerning wages, workers’ benefits, and working conditions. They also represent their members if employers or management violate employees’ rights and contract provisions (Bennett, & Kaufman. 2007. pp. 69-72).

Managing conflict

Conflict is a casual disagreement that results from people or a group of people who differ in beliefs, needs, attitudes, and values. Conflict can also be from past opposition, personality differences, or from failed or poorly initiated negotiations. Conflict can arise out of needs. When an individual or group needs are ignored conflict must arise. Different perceptions can also be a probable cause of conflict. People’s level of interpreting realities differs. The misconception of different observations may result from individual observations, different observations of similar situations, and observation of threats. Differing values or beliefs is another source of conflict. Some values so highly appreciated in a certain community may be rather useless to other communities. Where people hold differing views, or where values are ambiguous conflict will always arise. In situations where one party does not wish to listen to the wishes or requirements of the other party, the conflict will always arise. The way power and authority are used is another source of conflict. Where one party holds more power than the other uses its power to intimidate the other conflict will always result. Where an individual or a group of people try to change the actions of another to get undue advantage can resort to conflict (Stepis & Joan 1974. p. 225).

When people ignore their feelings and emotions or others, conflict can occur. Some people are overwhelmed by emotions to a level they are not able to control. Feelings and emotions in some cases may differ over a certain matter resulting in conflict. Conflict in some cases can be positive. When well managed, it can result in positive changes such as growth with innovations, new and diverse ways of thinking, and increased management options. Conflict needs to be well understood by both parties so that an agreement can be reached through negotiations. Solving conflict results in mutual benefit to both parties and hence strengthening their relationship. Conflict can be managed in various ways. There are five steps recommended for solving conflict these steps involve analyzing the conflict, deciding on the management strategy, pre-negotiation, negotiation, and post-negotiation stage. The nature and type of conflict should be analyzed by asking questions to the parties concerned or by direct interviewing the involved parties. More resources on conflict resolution should be sought. Once the conflict is well understood, the conflicting parties should analyze and adopt the most suitable strategy. Depending on the magnitude of the conflict, a neutral facilitator may help coordinate the processes towards consensus. There are several conflict management strategies that the conflicting parties can use in managing conflict. The groups can use the collaboration technique whereby both parties benefit equally. The result is a win/win situation for both parties. In this strategy, there is a high concern for both party’s interests. This approach builds trust and commitment towards each other and reduces ill feelings between the parties involved. This is the best conflict resolution strategy as both parties become a winner. The use of compromise as a strategy occurs where there is a high concern for one group’s interest at the cost of the other. The strategy results to win some/ lose some situations. The strategy is applied where one party wishes to achieve short-term solutions. The strategy leaves one party at least worse off and hence provides room for mistrust. The competition strategy occurs where one group posses high concern for its interest and less concern for the other party. The result of this strategy is a win/lose situation. It occurs where one party posses an advantage over the other concerning the conflicting issue. It is commonly used where essential rights are at risk, or a precedent is required. This strategy can further fuel the conflict to a point where the losers may hit back (Stepis & Joan 1974. pp. 229-233).

A conflict can be resolved through an accommodation strategy. This is where one party holds low interest for its concern and high interest for the concern of the other party. The outcome of such a case is a lost/win situation. This situation occurs where the issues of others are more important than yours and when one party considers itself to be in the wrong. The drawback to this strategy is that the losing party may lose influence in the future. The avoidance strategy may be used where there is a low concern for both parties’ interests. In such situations, the result is lost/lose for both parties. This strategy is mostly used when the conflicting issue is not important and there are more important issues to be handled. It’s also used where information is not sufficient. The problem with this approach is that some important decisions may be inhibited. The process of negotiations is initiated to reconcile the conflicting parties for mutual gain. Lack of properly initiated negotiation processes results in mistrust. To rebuild trust, both parties should be committed and willing to participate in the negotiation process. The violator must be willing to seek reconciliation. In the case of the Major league baseball strike, the team owners need to re-examine the circumstances that resulted to the strike and initiate measures that would help avert a possible recurrence. The team owners and the players should create and meet expectations to rebuild trust and avoid further conflicts (Lewicki & Wiethoff, C. 2000. pp. 145-147).

Reference

Filippelli, R. & Reilly, C. (1990) Labor conflict in the United States, An encyclopedia. – Garland Publishing New York & London (ISBN 082407968X)

Dietl, H. Lang, M. & Rathke, A. (2008): “The Effect of Salary Caps in Professional Team Sports on Social Welfare forthcoming in The B.E. Journal of Economic Analysis and Policy.

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Bennett, J, T., and Kaufman B, E. (2007) what do unions do?, a twenty-year perspective

Yates & Michael D. (2009) Why Unions Matter.‎ Maryland: University Press of America

Stepis & Joan A. (1974). Conflict-resolution strategies. The 1974 Annual Handbook for Group Facilitators. University Associates, Paige & Raygene. (1991). Creative conflict management. Paper presented at the preconference of the 82nd Annual meeting of the American Home Economics Association, Minneapolis, MN.

Lewicki, R., & Wiethoff, C. (2000). “Trust, Trust Development and Trust Repair.” In The Handbook of Conflict Resolution: Theory and Practice. Morton and Peter T. Coleman, eds. San Francisco: Jossey-Bass Publishers.

Lewicki, R., Barry, B., & Saunders, D. (2007). Essentials of negotiation (4th Ed.). Boston, Massachusetts: McGraw Hill.

Raiffa, W. (1982). The Art and Science of Negotiation. Cambridge, Massachusetts: Belknap Press.

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