Update, April 25, 2016: It seems Tom Brady isn’t so special after all, with the Second Circuit reversing the District Court and reinstating the arbitration award against him. I have zero sympathy for Brady, who is quite simply a cheater, but I do consider the reversal a bummer for every day employees who have similarly one-sided employment arbitrations but don’t have millions of dollars in the bank to cushion their loss.
The Second Circuit’s key conclusions were:
Article 46 gives the Commissioner broad authority to deal with conduct he believes might undermine the integrity of the game. The Commissioner properly understood that a series of rules relating to uniforms and equipment does not repeal his authority vested in him by the Association to protect professional football from detrimental conduct. We have little difficulty in concluding that the Commissioner’s decision to discipline Brady pursuant to Article 46 was “plausibly grounded in the parties’ agreement,” which is all the law requires. See Wackenhut, 126 F.3d at 2.
Here, the parties contracted in the CBA to specifically allow the Commissioner to sit as the arbitrator in all disputes brought pursuant to Article 46, Section 1(a). They did so knowing full well that the Commissioner had the sole power of determining what constitutes “conduct detrimental,” and thus knowing that the Commissioner would have a stake both in the underlying discipline and in every arbitration brought pursuant to Section 1(a). Had the parties wished to restrict the Commissioner’s authority, they could have fashioned a different agreement.
These conclusions say, in essence, that there really is no limit to how bad an arbitration can be — you can “agree” to have the opposing party be the one to determine if you’ve breached a vague clause in the contract, and then to be the one who decides if they’re wrong or not in the arbitration. That strikes me as so fundamentally unfair as to exceed the bounds of law, even if it is “plausibly grounded in the parties’ agreement.”
Earlier this week, a federal judge vacated Tom Brady’s “deflategate” suspension. At first blush it’s more than a little ridiculous that the federal courts are involved in NFL rule violations — but if we put aside the football aspect of this story, and instead look at it as an everyday union employee arbitration, then suddenly it looks less like a court getting involved in sports and more like an employer trying to make up the rules as it goes.
The NFL has rightly been under fire lately for it’s total lack of moral fiber, as shown by its belated, half-hearted measures regarding domestic violence, and the Court’s findings in “deflategate” reveal more of the same. The Court found, in essence, that the NFL’s collective bargaining agreement with its players is so vague about discipline that it doesn’t give sufficient notice to players that outright cheating could result in a suspension.
Some background: NFL players are unionized, and their collective bargaining agreement includes a provision calling for arbitration if the NFL and the Players’ Union have a dispute over a workplace grievance. That’s commonplace among unionized workers. It’s a standard method for resolving workplace grievances. It’s also standard for union arbitration awards to be appealed to federal court. See, Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185, and Section 10 of the Federal Arbitration Act, 9 U.S.C. § 10.
The fairness of an arbitration always starts with a basic question: who will be the arbitrator? By and large in America, arbitrations are done with an arbitrator that both parties agree upon, but there are exceptions, and some contracts allow one side to pick the arbitrator. As I wrote six years ago in The Very Worst Contractual Provision To Which You Can Agree, “anyone who demands they alone have the right to choose the arbitrator is trying to defraud you.”
That seems to be the case with the NFL’s collective bargaining agreement: the NFL gets to pick the arbitrator, and it can have the NFL Commissioner serve as the arbitrator. What sense does that make? Would you agree to an arbitration with your employer where the arbitrator was your employer? On the one hand, there’s a sound economic argument to be made that the NFL Players’ Union has ample bargaining power to negotiate this clause out of their collective bargaining agreement. On the other hand, there’s a simple legal argument that this sort of “I get to be my own judge” clause shouldn’t ever enter the picture. What’s the point of having a biased arbitration at all?
Brady rightly raised objections to Commissioner Goodell serving as the hearing officer at the arbitration, but the Court didn’t reach those claims. See opinion, pp. 38-39. Nonetheless, it’s hard to read the Court’s opinion without detecting the Court’s recognition that the process was, at its core, rigged.
The Court’s order had three main conclusions:
The Court is fully aware of the deference afforded to arbitral decisions, but, nevertheless, concludes that the Award should be vacated. The Award is premised upon several significant legal deficiencies, including (A) inadequate notice to Brady of both his potential discipline (four-game suspension) and his alleged misconduct; (B) denial of the opportunity for Brady to examine one of two lead investigators, namely NFL Executive Vice President and General Counsel Jeff Pash; and (C) denial of equal access to investigative files, including witness interview notes.
I personally have no doubt that Tom Brady knew the Patriots’ staff was lowering the pressure of his footballs, and that Brady either directed it or encouraged it. It’s inconceivable that Brady wouldn’t have recognized his balls were deflated: his job depends upon his careful handling of regulation footballs. Normally, this sort of obvious mens rea about a workplace impropriety would get an employee sanctioned or fired, but, well, the NFL doesn’t work that way.
Instead, when it comes to players, the NFL has a handful of specific rules — like those pertaining to use of performance-enhancing substances — and then a catch-all prohibition on any conduct that is “detrimental to the integrity of, or public confidence in, the game of professional football.” CBA Art. 46 §l(a). Shockingly, it seems that neither the CBA nor the NFL’s player policies has any provision governing suspensions for violating the NFL’s rules of the game. It also doesn’t seem like the NFL could point to any examples of it actually suspending a player for breaking the rules, and so Commissioner Goodell’s arbitration had to stretch to claim that the suspensions given out for steroid use — for which there is a specific prohibition — were adequate notice that a player could be suspended for breaking the rules.
The core of the Court’s opinion is found on pages 29 and 30:
A player’s right to notice is at the heart of the CBA and, for that matter, of our criminal and civil justice systems. While “[m]any controversies have raged about the cryptic and abstract words of the Due Process Clause … there can be no doubt that at a minimum they require that deprivation of life, liberty or property by adjudication be preceded by notice …. ” Texaco, Inc. v. Short, 102 S.Ct. 781, 795 (1982)(quoting Mullane v. Cent. Hanover Bank & Trust Co., 70 S.Ct. 652, 656 (1950)); see also Lankford v. Idaho, 111 S. Ct. 1723, 1729 (1991).
Brady was on notice that equipment violations under the Player Policies could result in fines. See discussion supra p. 28. He had no legal notice of discipline under the Competitive Integrity Policy, which is incorporated into the Game Operations Manual and distributed solely to — and, therefore, provides notice to — “Chief Executives, Club Presidents, General Managers, and Head Coaches,” and not to players. Game Operations Manual at A2.
This sounds like an argument only a lawyer could love. Tom Brady is surrounded by handlers and lawyers and is an integral part of the Patriots, and there can be no doubt that he knew he was doing something wrong for his benefit and the benefit of the team. That said, the core of labor relations law is a recognition that employees are distinct from employers, with different incentives and different pressures. As such, the burden is on the employer to give very specific notice about what violations will result in what discipline, and the NFL failed to do so here.
Though I agree with the decision the Court reached in Brady’s case, there’s unfortunately a much darker side to this story. Brady’s victory is an aberration; your typical blue-collar worker who was improperly disciplined or fired can’t expect to have that wiped away a month after it happens by a federal court. Instead, they can expect to wait months, sometimes years, before eventually losing.
As an empirical study found in 2011, federal courts typically confirm more than 90% of employment arbitration awards. As the authors of that study wrote,
Unfortunately, the [Supreme] Court’s decision in Hall Street has created conditions for undermining justice. Without legislation to prohibit mandatory arbitration, millions of employees need a judicial review standard to ensure that arbitrators do not intentionally disregard their legal rights. … Employees who are required to arbitrate their legal claims do not have the bargaining safeguards enjoyed by the businesses in Hall Street. No attorney helps them frame the terms of the arbitration agreement, and courts are rarely involved at this point. Thus, unlike the situation in Hall Street, where a judge approved the arbitration procedure, no judicial authority is present at this critical time.
Indeed. Your average employee doesn’t have a phalanx of lawyers negotiating their arbitration agreement, preserving every conceivable issue at the arbitration, and then fighting their battles in federal court. Similarly, very few employees have the luxury of having arbitration awards against them being reviewed and decided by courts merely a month after they filed.
So, Tom Brady is “special” and thus the winner. My elementary school football coach always said, “winners never cheat,” but I guess Tom Brady is an exception there too.