Friday, November 23, 2012

What You Need to Know About Decertification

Donald Fehr evil
The NHLPA made a big step towards the owners on Wednesday, only to be summarily rejected in about the time it takes to get your pizza delivered.

Now the NHLPA is fuming and for the first time this lockout the whispers of decertification are turning into shouts.

But what exactly is decertification and how can it help end the lockout? Below is an easy to read guide to everything you need to know about decertification.

Big thanks to sports lawyer Gabe Feldman for much of the information used in this article. For Feldman's full and much more detailed legal description of decertification, you can read his FAQ at the Huffington Post and Grantland.

What is decertification? What is a disclaimer of interest?

Decertification is when employees (in this case the players) formally revoke the union's ability to negotiate on their behalf. It is essentially dissolving the union. Decertification can take up to 60 days.

A disclaimer of interest is when a union walks away from its players. This isn't as formal of a process and is much quicker. In the NBA, the NBPA sent a letter to commissioner David Stern and that was it.

After this process, instead of a union the players would be represented by legal counsel.

Both processes get at the same ultimate goal, which leads to the next question...

Why would the players decertify?

The players would be able to challenge the lockout under antitrust laws. When a union and collective bargaining exist in pro sports, antitrust laws do not affect the league and players aren't allowed to attack league rules under the antitrust laws.

What will challenging the league under antitrust laws accomplish?

By challenging the lockout under antitrust laws, the players would essentially be able to challenge the legality of the lockout and any of the rules the league has in the place that might restrict a player's ability to make money. For example, players could challenge the salary cap, the entry draft, and UFA/RFA rules.

In simpler terms, the entire NHL system could be wiped clean.

What else can the players gain from an antitrust lawsuit?

The players would seek an injunction from the court that would block the lockout and force the NHL to re-open the league. If they could not get an injunction, the players would file lawsuits to seek money to compensate them for lost salaries and other financial damages caused by the lockout. Successful claims could provide three-times the actual damages.

Why is this a strong negotiating tactic for the union?

First, having the NHLPA actually benefits the league in some sense. It isn't likely the league would be thrilled to lose the salary cap and other rules that help to deflate salaries (i.e., RFA rules, entry-level contracts). Nor would it be happy to see young players go to the highest bidder, rather than through an entry draft.

Second, the financial damages the league would incur if players made successful lawsuits would be crippling. For example, if Shea Weber successful sued for damages over his lost salary this season (he is due to be paid $14 million), the league could theoretically be made to pay three-times that amount—$42 million...and that's for one player.

The owners might not like the deal on the table with the NHLPA, but the financial damages they could incur through the legal process would be far worse. It is therefore in the owners' best interest to negotiate with the players and end the lockout without the courts.

The players can essentially use decertification as a scare tactic to gain leverage and force the owners to begin negotiating in good faith.

What has to happen for the players to decertify the union?

At least 30 percent of the NHLPA must sign a petition stating they no longer want the NHLPA to represent them as a union. The National Labor Relations Board must then receive and verify the petition (which can sometimes take up to 60 days), which will lead to a vote among the union. Over 50 percent of the players must vote for decertification.

Can the union still negotiate as this is happening?

Yes. The union can negotiate up to the point of decertification. If the owners truly do not want to go through the courts to decide the lockout, this is the time that they will likely begin negotiating with the union in earnest.

I have heard decertification would mean the NHL season will be lost not only this year, but perhaps next year as well. Is this true?

No. The possibility of a lost season exists in any scenario, but it is hardly a certainty during the decertification process. In fact, if the players are not willing to give in to the owners' demands, and the owners are not willing to make any more concessions, decertification is one of the more likelier ways that we will see a season this year.

The notion of a lost season was propagated by both Nick Kypreos and Darren Dreger, neither of whom seem to have a solid grasp of the recent history of sports union decertification, nor how decertification works. In his own tweet, Dreger freely admits he "still need(s) to be educated on how it would work" and Kypreos jokes that he is not a lawyer.

There is no reason to believe decertification would produce the cancellation of the rest of the season.

Well, what are lawyers saying?

Sportsnet's Michael Grange spoke with NBA player agent Bill Duffy who said, "They should have done it three months ago."

In addition, Nathaniel Grow, a sports lawyer expert from the University of Georgia told the Globe and Mail: “It seems like they’re at the point where they’re about to exhaust the benefits of unionism. You have to start more seriously questioning if you need a game changer here to reshape the balance of power in negotiations.”

Has this tactic worked before?

Yes. Both the NBPA and the NFLPA used this tactic during their 2011 lockouts and both were successful. The NFL didn't miss any regular season games and the NBA had a tentative deal in place two weeks after the NBPA went "nuclear" with decertification.

The NFLPA also used this tactic in 1989, which ultimately led to NFL players gaining real free agency.

When did the union begin to seriously consider decertification?

According to the Globe and Mail's James Mirtle, the NHLPA has discussed decertification going back to September, but it was always discussed as a last resort. Now, after Wednesday's rejection, the players are taking it more seriously.

“After watching the other sport leagues go through labour disputes last year, it is apparent that until decertification is filed, there will not be any real movement or negotiation,” Ryan Miller told the Globe and Mail.

Why has it taken so long for the union to seriously consider decertification?

Some theories...

a) The NHLPA thought it could negotiate with the league to accomplish its goals. They thought if they were willing to make concessions, so too would the league, meaning going through the potentially long and chaotic route of decertification would not be necessary.

b) Donald Fehr did not have enough support from most players because they believed a).

c) It was after the players made a major step towards the owners with Wednesday's offer, only to be flatly rejected, that the players realized the league was only interested in taking, not giving. The owners unified and enraged the players, causing even the more moderate amongst the NHLPA to believe decertification was the best option.

d) Decertification is a gamble because antitrust lawsuits can take years and are unpredictable. So if the owners aren't willing to negotiate and would prefer to go the legal route, well, kiss the season goodbye.

Would the owners really be that stupid?

In regards to the NBA lockout, sports lawyer Gabe Feldman said, "The owners might have been willing to cancel an entire season to get a better CBA for future years, but are they willing to cancel an entire season while also risking three-times damages under antitrust law?"

NBA owners weren't, and I don't think NHL owners will be either.

But, not many people thought the league would be stupid enough to go through with a third lockout in two decades, so don't bet your house.

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