Minimum Wage Lawsuits Strike At the Core of Major Junior Hockey and Minor League Baseball

Many would argue that minor league baseball is the quintessential American sporting experience – playing for the love of the game in small towns throughout the country, dreaming of the big leagues, or playing out the string.  Similarly, nothing may be more distinctively Canadian than major junior hockey – the primary breeding ground for future NHLers for generations and the pride of Canadian communities from Cape Breton to Victoria.  The two share more than long bus rides and long odds.  They both are the subject of lawsuits filed in 2014 challenging the fundamental aspect of their respective business models – namely, below minimum wage-level player salaries.

As previously reported here, in February 2014, former minor league baseball players filed a class action suit in the U.S. District Court for the Northern District of California against Major League Baseball, the Office of the Commissioner, and their former teams, arguing that the low pay, mandatory overtime and lack of collective bargaining rights violate federal and state law (Senne et al. v. Office of the Commissioner of Baseball et al., 3:14-CV-00608 [ND Cal.]). The plaintiffs assert that the defendants are not exempt from minimum-wage and overtime requirements, following two decisions by the 6th U.S. Circuit Court of Appeals (Bridewell v. Cincinnati Reds, 68 F3d 136 [6th Cir. 1995], cert. denied, 516 US 1172 [1996]; Bridewell v. Cincinnati Reds, 155 F3d 828 [6th Cir. 1998]).  The case is currently subject to pending motions to dismiss and motions to transfer venue that are scheduled to be heard on February 13, 2015.

In October 2014, former Canadian junior hockey players followed their American baseball compatriots with a class action against the Canadian Hockey League, the umbrella organization encompassing the Ontario Hockey League, Western Hockey League, and Quebec Major Junior Hockey League. The lawsuit filed in a Toronto court seeks $180 million in compensation for outstanding wages, overtime, holiday and vacation pay.  The initial press reports indicate that the Canadian Hockey League is planning to “vigorously defend” the case and is taking the position that its players are “amateur student athletes” (see Class action lawsuit filed against Canadian Hockey League over wages).  Major junior players, however, are considered professionals rendered ineligible to play NCAA hockey due to receiving salaries reportedly ranging from $35 to $120 a week, plus expenses such as room and board, as well as a post-secondary tuition reimbursement package.

Common to both lawsuits is that the time spent training and playing, not to mention the time under the direction and control of the employer in traveling via bus from town to town, divided by the paltry salaries, results in an average hourly wage less than is earned by a minimum-wage fast food restaurant worker. Another similarity that is perhaps underlying both lawsuits is the lack of a players union in either minor league baseball or major junior hockey. At issue is whether these traditional right-of-passage development systems fit exemptions to otherwise applicable wage and hour laws—such as exceptions for seasonal workers under the Fair Labor Standards Act, or as interns under Ontario law, for instance.

Also uncertain in both cases, like the several lawsuits by student-athletes seeking compensation for participating in NCAA athletics, is whether the leagues will be sustainable economically in the event their respective player compensation systems are altered by the courts. Fears that the lawsuits may cause the ruin of minor league baseball and major junior hockey may be assuaged by the viability of minor league hockey in the ECHL which operates in 28 small and large markets from coast to coast, has a players union, and compensates its players with a living (though certainly not lucrative) wage.  In any event, no matter what way the lawsuits turn out, it is clear that no corner of the sports world, on either side of the border, is safe from the litigation arena.

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