NFL Draft Trifecta
It is certainly the case that the non-statutory labor exemption to the antitrust laws places rookies and draft picks at a huge disadvantage when it comes to salary negotiations. While we are fond of talking about how the reserve clause in the major sports leagues died with the advent of free agency, in fact the reserve clause is alive and well today. It’s just that it is only applied to players in the first few years of their career. Of course, given the relatively short careers of most professional athletes, the current reserve clause rules may cover a typical athlete’s entire career.
That being said, let’s not be too hard on the non-statutory labor exemption. Without this judicial understanding of the labor laws, most of the league rules put in place to promote competitive balance would be under constant threat of antitrust litigation. Without a union’s consent, the reverse order draft, salary caps, luxury tax, roster limits, etc., all of which are the result of individual teams coming together and conspiring to limit player compensation, would clearly be, if not per se violations of the antitrust laws, at least subject to significant scrutiny under the rule of reason.
Without the ability to negotiate in good faith without the threat of impending antitrust action, it is unclear how modern sports leagues would be able to function efficiently, at least in terms of promoting competitive balance.