On Tuesday, the Major League Baseball Players Association filed a grievance against four major-league teams: Miami, Oakland, Pittsburgh, and Tampa Bay. Specifically, the MLBPA contends that these four teams are violating the collective bargaining agreement by misusing their revenue-sharing money.
To understand the implications of the union’s grievance, we have to begin with the language of the CBA itself. Article XXIV(A) of the CBA states that “[a]ny Club seeking a distribution from the Commissioner’s Discretionary Fund [that is, the revenue-sharing money] shall submit a request in writing to the Commissioner. The written request must include, but need not be limited to: (i) the amount requested; (ii) the use(s) to which the Club intends to put the requested distribution; and (iii) an explanation of how, in the Club’s view, the requested distribution should improve the Club’s performance on the field” (emphasis mine).
Later on, the CBA is even more explicit:
[E]ach Club shall use its revenue sharing receipts (including any distributions from the Commissioner’s Discretionary Fund) in an effort to improve its performance on the field. The following uses of revenue sharing receipts are not consistent with a Club’s obligation . . . to improve its performance on the field: payments to service acquisition debt or any other debt that is unrelated to past or future efforts to improve performance on the field; payments to individuals other than on-field personnel or personnel related to player development; payments to entities that do not have a direct role in improving on-field performance; and distributions to ownership that are not intended to offset tax obligations resulting from Club operations.
It’s that language on which the MLBPA is hanging its hat.
Now the MLBPA’s grievance will go before an arbitration panel, not a court. The rules of private arbitrations like this are generally set by the parties themselves. That can lead to some interesting quirks, like the fact that the commissioner himself serves as arbitrator in certain proceedings that are appeals from his own decisions (the interest-of-the-game clause and the like). In this case, the grievance hearing will be conducted in accordance with the Rules of Procedure laid out in Appendix B of the CBA.
Those Rules are pretty lengthy, so here are the pertinent bits: the legal rules of evidence don’t apply, the arbitration panel sets its own standard of proof (in other words, how much evidence one side needs to present to win), and it’s possible to avoid a hearing altogether just by both sides agreeing to submit legal briefs. Also, there are three arbitrators: one selected by the MLBPA, one selected by MLB, and a neutral third party who is usually a lawyer with some experience in conflict resolution and who serves as the panel chair. That means that, as a practical matter, it’s the panel chair who decides these cases.
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