Jeff Nixon’s Letter to the NFL
Right on, Jeff!
Mary-ann Fleming
Manager, Player Benefits
National Football League
280 Park Avenue
New York, New York 10017
November 12, 2008
Dear Mrs. Fleming:
Thank you for meeting with our Buffalo Bills Retired Player’s Chapter on November 12, 2008 and discussing player benefits with our group.
In the meeting you stated that the owners Management Council actively participates in negotiating the pension benefits for retired players through the collective bargaining process. I told you that it was my understanding that the owners are not involved in any significant way when it comes to negotiating retired player benefits and that it is the active players that make the critical decision regarding the amount of money that goes to improving retired player pensions. Apparently there is some disagreement and confusion about this issue that also arose during Commissioner Goodell’s meeting with retired players in Chicago on November 8, 2008.
Many retired players received a letter from Jim McFarland, one of our NFLPA Steering Committee members, recapping the meeting in Chicago between Commissioner Roger Goodell and retired players from that area. Mr. McFarland reported, to the best of his recollection, the following:
“There followed an interesting exchange between Commissioner Goodell and Jean Fugett. Jean Fugett firmly stated that the active players provided the pension benefits for retired players. The Commissioner said that it was the owners who provided the retirement benefits. He inquired how the active players provided the benefits. Jean replied that the retirement benefits came out of the 60% of the gross revenues earned by the players. The Commisioner responded by asking who provided the 60% to the players. Jean responded that the players generated the revenues. The Commissioner said that he and Jean obviously had different views on the source of the revenues, but that they would just have to respectfully disagree.
Mr. McFarland also went on to report that “It was pointed out that retired players are often provided a type of “whipsaw” argument with regard to retirement. The owners generally tell the players that they give retirement money to the active players and it is the active players who could apportion more of the moneys to retired players. In contrast, the active players tell retired players that there is only so much money given for retirement and that the retired players should look to the owners for additional retirement funds. So retired players are caught in the middle with both the NFL owners and the NFLPA active players pointing their fingers at each other blaming the other side for the inadequate pension benefits.”
Obviously there is some concern and confusion over how retirement benefits are negotiated when the President of the NFLPA Retired Players Streering Committee, Jean Fugett disagrees with the NFL Commissioner regarding this issue.
To muddy the waters even more, the NFLPA website also has the following information posted under its “Retired Players FAQ (frequently asked questions).
“Labor law requires the NFLPA and NFL Management Council to bargain in good faith over working conditions, benefits, and compensation affecting the bargaining unit of players. The bargaining unit is composed of professional football players employed, or who are seeking to be employed, by a member club of the NFL. Retired players are not part of the bargaining unit and, therefore, the NFL Management Council is not legally obligated to bargain in good faith over any improvements in already-earned player pension benefits.”
Is the underlined section of this statement accurate? If the Management Council is not legally obligated to bargain in good faith, what guarantees do we have that they will?
In closing, I should mention that the NFLPA has continually warned us that the Pension Plan is under-funded and that there is no way that the NFLPA can improve benefits to the level of active players.
On March 17, 2008 the NFLPA sent us the Annual Funding Notice for our Bert Bell/Pete Rozell NFL Retirement Plan. We were informed that the current funded liability percentage for the 2006 plan year was 51.2% based on actuarial assumptions required by the IRS. This means that the money in the plan is projected to cover only 51.2% of retirement benefits! The NFLPA says that the more accurate figure is 76% based on their actuarial assumptions, but regardless of who is right, the NFL Pension Plan is underfunded. Keep in mind, this was the projection based on 2006. With the recent downturn in the economy and the stock market taking some huge losses, the funded liability percentage will probably go down even further, putting the Pension Plan at even greater risk.
It is reassuring to know that the Commissioner has publicly stated that increasing the pension benefit for retired players is one of his priorities. It is my hope that during the next CBA negotiations the Pension Plan takes priority over other benefits that are not required by law. For example, the Second Career Savings Plan, the Annuity Plan, the Health Reimbursement Account etc.
Thank you again for taking the time to come to Buffalo and discuss player benefits with our Retired Players Chapter and we appreciate you conveying the concerns expressed at the meeting to NFL Commissioner, Robert Goodell.
Sincerely,
Jeff Nixon
cc: Buffalo Bills Retired Player Chapter Members
Irv Cross
November 14th, 2008 at 9:21 am #
Jeff:
Thanks for an outstanding letter. Your observations confirm the need to have a representative group of active and retired players to clear the air on disability and pension misunderstandings. My first thought is to get John Hogan involved in an official way to help resolve our disability and pension issues.
Irv
Dave Pear
November 14th, 2008 at 11:18 am #
Dear Irv,
We agree with you 100%! John Hogan is a disability expert lawyer who has already rewritten the disability plan and I’m sure he would do the same for the pension plan. We need adult supervision!
Sincerely,
Dave & Heidi Pear