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Baseball negotiations in the modern era have been plagued by strong-willed personalities. Marvin Miller set the tone when he refused to accept the paternalism between owners and players that had existed for so long in the game. Instead, he was determined to establish an adversarial relationship that continues to the present.

The players felt they had little alternative to striking. Had they continued playing through the season without coming to an agreement, the owners could have declared an impasse and most likely implemented their proposals. Also, the timing of the strike, which began on August 12, 1994, was favorable for the union because it inflicted maximum damage on the owners. That late in the season, the players had received most of their pay, but the owners were vulnerable to big losses because they receive three-fourths of their television revenues from postseason play. In anticipation of a strike for the previous 4 years the Players Association had retained a portion of each player?s licensing revenues from the sale of products such as baseball cards. As a result, a strike fund of about $175 million was accumulated so that each player with 4 years? experience would have about $150,000 to hold them over until the strike came to an end (Monthly Labor Review).

At the beginning of the strike, the parties had agreed to accept mediation efforts by the Federal Mediation and Conciliation Service. Mediators try to persuade the parties to make concessions and come to an agreement, but, unlike arbitrators have no power to impose a settlement. Therefore, mediation would not necessarily bring an end to the dispute. Several Federal mediators, including the Conciliation Service?s director, John Calhoun Wells, were unable to make progress toward settlement in 1994. This was because the parties were already committed to disagreeing. Under such circumstances, no mediator can be successful. One change that did result from the suggestions of mediators was that several owners became involved in negotiations, and bargaining influence began to slip away from Ravitch and toward owners Jerry McMorris of Colorado and John Harrington of Boston (Monthly Labor Review).

Under the owners? rules, a three-fourths vote was required to approve a settlement. This created a sever obstacle because the owners were split generally into three groups. The groups were largely based on market size, the small market teams, which include teams like Kansas City, Milwaukee, Minnesota, Montreal, Pittsburgh, San Diego, and Seattle. On the other end were owners with teams in large markets and some owners from smaller market teams that had recently built new stadiums and were doing well financially. These clubs, who had more to lose from a prolonged strike, included Atlanta, Boston, Colorado, Los Angeles, both New York teams, Texas, and Toronto. The remaining teams were somewhere in between, looking for only moderate changes, but were susceptible to arm-twisting from either side (Layden 42).

In late August, McMorris and the owners? legal counsel, Charles O’Connor, suggested the idea of a graduated ?luxury tax? to the union. If a club?s payroll significantly exceeded the major league average, that club would have to pay a luxury tax based on its total payroll. The tax rate would be graduated the more the club?s payroll exceeded the major league average. Money from the tax would go into a pool that would be distributed to financially needy teams (Monthly Labor Review).

The union viewed this proposal as a salary cap in disguise, because clubs would resist signing high-salaried free agents if the addition to payroll would have the side of effect of more taxes being paid. Still, the union tried to work with the luxury tax concept, proposing a 1.5 percent tax on revenues and payrolls of the 16 largest clubs in terms of revenue and payroll, with the money distributed to the bottom 12 clubs (Dolan 111). The union also suggested that home teams share 25 percent of their gate receipts with visiting teams. Shortly after rejecting the union?s counteroffer, on September 14, 1994, the owners declared the cancellation of the World Series for the first time since 1904 (Atlantic Unbound).

In mid-October, President Bill Clinton announced the appointment of William J. Usery, Jr., to mediate the dispute. The President could not have chosen a more able representative. Usery was Secretary of Labor in the Ford administration and before that was director of the Federal Mediation and Conciliation Service. Although 70 years old, Usery had remained active after his Government service by privately mediating some of the Nation?s biggest industrial disputes in recent years. He had the experience to identify common ground and the tenacity to move the parties in that direction, but he lacked knowledge of the complications of baseball labor relations (Layden 55).

Unfortunately, Usery suffered the same fate as the earlier mediators. The parties modified their proposals somewhat, but remained far apart. The owners wanted to contain the salary rise, which had grown to an average of nearly $1.2 million per player, while the union was unwilling to do so. At this time, the only understanding between the parties was that some kind of revenue distribution should occur from richer to poorer teams.

By the end of 1994, negotiations were slowing down, and the owners declared an impasse, putting the salary cap into effect. The declaration of an impasse was a dreaded scenario for the union because it meant that management could implement its own proposals. To show its distaste for the owners? actions, the union filed unfair labor practice charges with the National Labor Relations Board (NLRB) (Atlantic Unbound).

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