Column: MLB Underpays ScoutsJuly 13, 2015

Column: MLB Underpays ScoutsAlmost every group of MLB employees seems to think they’re underpaid. In the past two years the league has been besieged by complaints and/or lawsuits from clubhouse attendants, administrative workers, interns, “volunteers,” and Minor League players. They all complain that MLB violates the federal Fair Labor Standards Act (FLSA) along with state wage and hour laws by failing to pay minimum wage and overtime. In some cases, the plaintiffs have also alleged that MLB’s practices violate federal and state antitrust laws.

Now, scouts have jumped on the litigation bandwagon. Two weeks ago former Kansas City Royals scout Jordan Wyckoff filed a class action lawsuit in a New York federal court claiming that many MLB scouts make less than minimum wage and aren’t properly compensated for overtime, practices that violate the FLSA. In addition to his FLSA argument, Wyckoff also alleges that MLB teams conspire to keep scouts’ wages depressed in violation of state and federal antitrust laws.

Wyckoff claims he was paid $15,000 a year as a part time scout for the Royals, scouring the northeastern part of the country for MLB prospects. During that time he often worked 50-60 hours per week, effectively earning less than $5 per hour, substantially less than the federal minimum wage of $7.25 per hour. Nor was he paid overtime for hours worked in excess of 40.

If the Wyckoff case sounds like a broken record, perhaps the record is indeed broken, i.e., MLB consistently squeezes the folks it can. Before Marvin Miller arrived on the baseball scene in the mid-‘60’s, MLB treated its players like serfs. The players had no union to protect them and in most cases teams even refused to deal with agents, leaving the players at a distinct disadvantage when dealing with management.

That all changed after 1966 when Miller became executive director of the players’ union. It became much more difficult to squeeze the players, so much so that the league finally gave up after the disastrous 1994 strike almost relegated the sport to an afterthought. MLB decided to treat the players like partners rather than chattel and, contrary to the owners’ concerns, the game has flourished ever since.

Alas, MLB execs don’t have to treat other employees like partners because none of them, save for MLB umpires, are represented by a union. That seems to be the common denominator between employees who are well treated and those who aren’t, which is a sad commentary on management-employee relations. Shouldn’t non-union employees be treated in a decent, fair and ethical manner and in accordance with federal and state laws without having to resort to the courts?

While MLB has yet to file an answer to Wyckoff’s complaint, it’s not hard to predict what some of their defenses will be. First, they are likely to argue that they are exempt from FLSA requirements because they are a seasonal business. Courts are split on this issue, some saying the league is, others saying they aren’t a seasonal business. Until the Supreme Court rules definitively on the issue, lower courts are free to disagree.

Second, MLB will argue that Wyckoff is exempt from overtime pay as a salaried worker. While the FLSA provides such an exception, employees must be working in an “executive, administrative or professional capacity” in order to meet that qualification. Some scouts may fall within the exception, but it’s doubtful Wyckoff did. Furthermore, the FLSA’s compensation threshold for the exemption is a salary of $455 per week, or $23,660 per year (last month President Obama proposed new rules that would raise the federal threshold to $50,440). While some scouts earn more than the current minimum, Wyckoff clearly did not.

In support of his antitrust argument, Wyckoff claims MLB teams engage in various agreements to depress the market for scouts’ services, including the refusal to hire another team’s scouts, prohibiting executives who leave one team from bringing scouts with them and in some cases, even firing scouts who merely seek permission to talk with another team. MLB will likely respond that it holds an exempttion from the antitrust laws, although whether the exemption extends to its treatment of scouts is in doubt.

What isn’t in doubt is that many MLB employees feel they are mistreated. With so much smoke, there may indeed be a fire.