November 21, 2013

Analyzing A-Rod's Arbitration Case

Where A-Rod's Representation Went Wrong

by Eugene Freedman

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On Wednesday, Alex Rodriguez reportedly stormed out of his disciplinary hearing and made various pronouncements to the media, most notably during an interview with Mike Francesa on WFAN and the YES Network. Under normal circumstances, we could see this as his true emotional response to the negative ruling he’d just received (that Commissioner Selig would not be required to testify in the case). But because everything we’ve seen thus far from A-Rod and his team has been so orchestrated, I can interpret this only as a well-rehearsed and well-scheduled event like all of the rest.

Over the course of this drama, we’ve read and heard a lot from and about Alex Rodriguez’s legal team. For many of us in the labor relations field, the entire concept of A-Rod having a legal team is anathema to the grievance arbitration process.

In a normal grievance procedure, either the Union or an employee may file a grievance at Step 1, although even when an employee files his own grievance, the Union has the right to be present and argue its position. But once the grievance moves to arbitration, the process is owned exclusively by the Union. This is because arbitration is a contractual right, not a statutory right. The Union is the party to the Collective Bargaining Agreement, and it should control which cases go forward so that individual members cannot create bad law of the contract, undermining the rights of the rest of the bargaining unit.

In A-Rod’s disciplinary case, he has his own legal team. This creates a curious situation in which A-Rod can bring in his own counsel to argue his case and his argument may be in opposition to or significantly different from the position of his Union.

The New York Times reported on why A-Rod may have his own staff of high-priced lawyers representing him as opposed to the MLBPA. The article referenced a letter from A-Rod’s team of lawyers:

In it, Rodriguez’s lawyers notified the players association that they believed the union failed to “fairly represent his interests” regarding Major League Baseball’s investigation of Biogenesis of America…

The letter argued that the players association had missed opportunities to challenge baseball officials’ aggressive investigative tactics; that the union had not strongly enough condemned baseball’s “gratuitous leaks” to the news media; and, most pointedly, that Michael Weiner, the union’s executive director, had publicly compromised Rodriguez’s position in a radio interview when he signaled that Rodriguez should have accepted some type of suspension “based on the evidence we saw.”

Several of us in the legal Twittersphere questioned Weiner’s interview at the time, concluding that it was an admission against interest. There were several other statements by Weiner that were questionable as well, including one early in the investigation in which he seemed to indicate that these cases would not be handled under the use or possession provisions in the Parties’ Joint Drug Agreement, but instead be covered by the just cause disciplinary provisions, which do not have fixed penalties.

The Times article was a bit confused about the process, however:

The four-page letter was addressed to David Prouty, the players association’s general counsel. It aimed to replace the union’s lawyer for a crucial arbitration hearing regarding the suspension.

It was unclear how the union responded, but the letter apparently proved unsuccessful. At the hearing, which began Monday and will continue in mid-October, Prouty served on the arbitration panel as Rodriguez’s representative. The other members of the panel are Robert Manfred, a senior executive in Major League Baseball, and Fredric Horowitz, an independent arbitrator appointed by both sides.

I would disagree. The letter did prove successful. A-Rod’s team is representing him in the hearing alongside the Union. As I referenced in my prior column, the arbitration panel has three members, one from each party plus the union, but only Arbitrator Horowitz will make the decision.

The MLBPA is the exclusive representative of employees on 40-man rosters. This is based upon a National Labor Relations Board certification election. Having been duly certified, Section 9(a) of the National Labor Relations Act states,

Representatives designated or selected for the purposes of collective bargaining by the majority of the employees in a unit appropriate for such purposes, shall be the exclusive representatives of all the employees in such unit for the purposes of collective bargaining in respect to rates of pay, wages, hours of employment, or other conditions of employment: Provided, That any individual employee or a group of employees shall have the right at any time to present grievances to their employer and to have such grievances adjusted, without the intervention of the bargaining representative, as long as the adjustment is not inconsistent with the terms of a collective- bargaining contract or agreement then in effect: Provided further, That the bargaining representative has been given opportunity to be present at such adjustment.

This of course, deals only with presenting grievances to the employer. As I mentioned above, the arbitration process is owned by the Union. In the Rodriguez case, I would imagine that A-Rod’s team of handlers, from lawyers to public relations advisors to whatever other hangers-on he may have, probably suggested that the Union was going to sell him down the river and that he needed personal representation. They then spared no expense in acquiring for him the greatest criminal and sports lawyers the media has ever quoted, with nary a labor lawyer in the bunch.

I also suspect that A-Rod’s team’s threat that the Union was violating its duty of fair representation was really a threat of lawsuit. The Union likely responded, “Sure, you can step in and handle the case, but you will sign a waiver of claims against us if we let you handle this case in this private proceeding on behalf of a client whom we have the exclusive right to represent.” MLBPA realizes that A-Rod’s team hasn’t met a lawsuit it doesn’t want to file, so giving him his team would accomplish two things, if there was a waiver of claims. It would inoculate them in the event of a loss in the case (A-Rod’s team can’t make a claim against the Union for lost wages), and it would protect them from the Union’s membership, which is now more rabidly anti-doping than perhaps even the media.

The problem with A-Rod having hired only criminal, sports, corporate, and other specialized non-labor lawyers is multi-fold, and it is unfolding right before our eyes. Unions and employers have long-term relationships. They treat each other with the necessary comportment of a long-term relationship. Labor relations is about relationships, after all. Unlike every other contract, when a collective bargaining agreement expires, the relationship doesn’t end even if the parties dislike each other and can’t work together. It just means that they have to suffer through the relationship until they can find common ground.

Labor lawyers also treat the arbitrators with respect. They appear before the same arbitrator or arbitrators regularly, and they know that arbitrators, although they’re independent contractors, have relationships with each other, which means that bad reputations precede bad actors. If you’ve worked with an arbitrator for years and know that you will for years to come, you’re not going to engage in outlandish theatrics that might play in television dramas or the media circus “trial of the century.” You’re also going to treat the other party with respect, because the relationship will last longer than the one case.

On the other hand, if you’re a hired gun who has never handled a labor arbitration and likely never will again, you don’t have to worry about how over-the-top you are toward the other side, much less the arbitrator.

A-Rod calling the arbitration “a farce” and disparaging the arbitrator in public is a tactic his team has concocted in order to get out in front of a bad decision. It screams of a public relations solution to a labor relations issue. If MLB’s case is made on the credibility of felons and liars, undermine their credibility with the arbitrator, not the arbitrator’s credibility with the public. Worse yet, if you’re changing your strategy at this point to one of attacking the process, who’s to say A-Rod won’t sue you for malpractice when the case doesn’t work out in his favor? After all, he’s threatened or sued everyone else. Further, attacking the process appears to be a desperate act, rather than one built on the confidence professed during the early media blitz by A-Rod’s legal team.

And for those who think this is just an elaborate scheme to declare the process unfair now so A-Rod can challenge the ruling once it’s been issued, I wouldn’t expect that to go anywhere either, although it would lead to a lot more legal fees. Courts grant great deference to labor arbitration and arbitrators under what’s referred to as the Steelworkers Trilogy, a series of cases issued by the Supreme Court in 1960. One of those cases is also likely the basis for dismissing A-Rod’s case against MLB—this investigation and matters related to the discipline are covered by the CBA, and therefore subject to the grievance arbitration process rather than private suit.

All told, I think the result in the arbitration was likely to be the same regardless of who represented A-Rod, the Union or his team. MLB must prove its case on each charge by a preponderance of the evidence and also prove that its penalty is reasonable and appropriate. The evidence is what it is. A-Rod is getting a more public version of the private hearing he was going to get anyway, with a lot more attention than was necessary and at a significantly higher expense.

Eugene Freedman is Deputy General Counsel for a national labor union. He has a BS in Industrial & Labor Relations from Cornell University and earned his JD from the University of Maryland.

Eugene Freedman is an author of Baseball Prospectus. Follow @EugeneFreedman
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