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Saturday, October 14, 2006
 
A Proposal to Unions: The Agent Business May Require Systemic Change

For anyone interested, I just posted on SSRN my recent article published in the Willamette Law Review, Solving Problems in the Player Representation Business: Unions Should be the "Exclusive" Representatives of the Players. You can access it by clicking on the link to my articles posted on the blog. You will need a free SSRN account to read it, and you can get such an account here.

My article examines how the economics of the player representation business, with increasing player salaries under a commission-based agent fee system, are fueling more intense competition among agents, which is detrimental to the players, the teams and the leagues. I argue that players associations, as the exclusive representatives of the players under the labor laws, must consider whether the third party agent representation system serves the best interest of the players collectively, and whether the system can be improved for the betterment of all union members, not just a handful of premier players. I propose that the players associations establish internal player management agencies giving players the option to retain a full-time salaried agent employed by the union. I also propose some revisions to the unions' existing agent regulations, including an alternative agent fee structure, a complete ban on client solicitation, and more union administration and oversight in the agent selection and representation process, which would substantially reduce the incentive for agents to engage in harmful competition and would ensure that players are paying their agents a reasonable fee but would at the same time maintain the player's autonomy in selecting his own agent.

I understand that the concept of unions representing players seems unrealistic and difficult to do from an administration standpoint, conflicts of interest, etc., and my article discusses these issues in-depth.





4 Comments:

Might not be a bad idea if the only service that an agent provided was salary negotiation. I suppose agent-client services could still exist separate and apart from any salary negotiation component but at greatly reduced fees thereby eliminating any incentive for an agent to provide such services.

Anonymous Anonymous -- 10/14/2006 9:50 AM  


What types of agent-client services are you referring to? Most legitimate services are in addition to, and billed separately from, the contract negotiation services (i.e. legal services, endorsements, investment planning, etc.), and these services would not be performed by the unions under my proposal. Granted, agents also perform the "babysitting" services, like sending a player cleats when he forgets to take them with him on a roadtrip, and these services are included in the agent's commission fee (but clearly are not worth that much). You raise an excellent point: If you take out the commission component, it would eliminate any incentive for agents.

Blogger Rick Karcher -- 10/15/2006 5:57 PM  


The endorsement side is where the real money is, so I'm not sure your solution would solve the majority of problems out there. The Reggie Bush situation, for example, dealt solely with the endorsement side. And since his marketing agent isn't even registered with the union, there's nothing they can do.

Anonymous john -- 10/16/2006 11:31 AM  


John,

Thanks for the comment. First, there is a very small number of players that get "real money" by way of endorsements. In fact, most of the first rounders in all sports don't make a lot by way of endorsements. Most of society has never even heard of the number one draft pick in baseball each year. Nor have they ever heard of the first rounders in football, with the exception of one or two players. Secondly, the union can and does regulate agents in the context of their endorsement activity if the agent also negotiates player contracts, and most of them do both (Bush's marketing guy is an exception). I see a lot more problems as a whole that flow from the player contract side of things than from the endorsement side.

Blogger Rick Karcher -- 10/16/2006 6:42 PM  


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