Extraterritorial Lockouts in Sports: How the Alberta Labour Board Erred in Declining Jurisdiction Over the NHL
45 Pages Posted: 21 Feb 2014
Date Written: March 18, 2013
Abstract
Labor related work stoppages are becoming an epidemic in the four major American sports leagues, the National Hockey League (NHL), National Basketball Association (NBA), Major League Baseball (MLB) and National Football League (NFL). With the successful use of player strikes and several successful antitrust challenges, 1970-2000 was a period of significant player gains in the form of free agency rights and salary increases. Yet the past ten years represent a period of substantial owner take-backs, largely through the use of owner-imposed lockouts. This trend began when the NHL took the extreme step of cancelling the entire 2004-05 season in order to impose a hard cap on player salaries. In 2011, both the NFL and NBA locked out their players and achieved reductions in the percentage of league revenues paid to their players. The NFL even survived an antitrust challenge to its lockout, defeating the players’ previously powerful negotiation tool. Following this playbook, the NHL again locked out its players in 2012-13, demanding that the players take a smaller share of league revenues and looking to further capitalize on gains from the 2004-05 lockout.
Work stoppages in sports leagues affect more than just the owners, the players and the disappointed fans. The 2012-13 NHL lockout resulted in the cancellation of 510 NHL games spread throughout the United States and Canada. NHL games stimulate the economy beyond the money divided between the owners and the players. This is particularly true for the restaurants and bars surrounding arenas that rely on games to generate business, and for the middle-class workers who keep the franchises running. The lockout also affected sales of merchandise and goods of NHL sponsors who rely on games to advertise their products. Finally, the lockout damaged the newly branded NBC Sports Network’s hopes of building a cable sports competitor to ESPN, despite NBC agreeing to pay at least $1.8 billion to land the NHL as its featured content.
The bargaining relationship between the NHL and the National Hockey League Players’ Association (NHLPA), like those of other major sports leagues, is largely governed by United States labor law. Yet, the NHL has seven Canadian teams, and Canadian labor law is generally much more restrictive than American law on allowing work stoppages. This difference creates a jurisdictional labor policy conflict, which will be the focus of this Note. The U.S. National Labor Relations Board (NLRB) has asserted jurisdiction over issues concerning the entire league, including work stoppages and union certification. However, NLRB jurisdiction over the actions of the Canadian teams is a gray area, as the U.S. National Labor Relations Act (NLRA) does not extend extraterritorially. Moreover, any NLRB jurisdiction exerted over the actions of Canadian teams is necessarily incomplete, because the NLRB lacks any authority in Canada. The NLRB can only influence Canadian teams’ actions inasmuch as it can influence the NHL as a joint venture of all teams, American and Canadian.
Looking to exploit this cross-border policy conflict, the NHLPA attempted to stop the 2012-13 NHL lockout under the more restrictive Canadian work stoppage rules by filing an illegal lockout charge against the NHL with the Alberta Labour Relations Board (ALRB). This charge would have applied only to the NHL’s two Alberta teams, the Edmonton Oilers and the Calgary Flames. The NHLPA hoped that the broader NHL lockout would be crippled if these two mid-market teams were forced to pay their players, despite not bringing in any revenue from playing games. If the ALRB had declared the lockout illegal, it would have tilted the bargaining relationship toward the players. More importantly, it would have almost certainly shortened the lockout, which would have been good for fans and for the economy. It might also have disincentivized work stoppages in other sports leagues, since the NBA, MLS and MLB all have Canadian teams.
Unfortunately, the ALRB refused even to decide whether it had jurisdiction over the matter, simply describing jurisdiction as “ambiguous,” before declining to intervene on discretionary grounds. This Note argues that the ALRB erred by not holding that it had jurisdiction over the actions of the Flames and the Oilers. Further, as a matter of policy, even declining jurisdiction would have been preferable to this ambiguous result. Part I of this Note recounts the history of the NHL-NHLPA bargaining relationship. Part II discusses past case law involving Canadian labor boards’ jurisdiction over North American sports bargaining relationships. Part III evaluates the labor policy considerations regarding the Board’s failure to decide whether it had jurisdiction over the NHL-NHLPA bargaining relationship. Finally, Part IV discusses and dismisses the Board’s proposed obstacles to ALRB jurisdiction over the bargaining relationship, arguing that while there may have been reasons for the Board not to intervene, particularly in the first month of the lockout, none of those reasons should affect whether the Board has the authority to intervene in the future.
Keywords: NHL, Labor, sports, collective bargaining, lockout, NLRA, ALRB, cross border conflict, Canada, Labour
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