Contracts and Their Place In Sport

Contracts are used just about everywhere. According to my class textbook, “Fundamentals of Contract Law”, Contracts are legally binding agreements between two or more parties which will be enforced and recognized by the law. Contracts are seen in our everyday lives. Whenever we purchase something, we agree to buy an item in exchange for money. Whenever we sell something, we agree to give away an item for cash or other forms of payment.

Contracts are seen everyday in the sport industry as well. Everyday when you are reading an ESPN article, you see articles with stories such as Marshawn Lynch signing a two year contract extension with the Seattle Seahawks worth $24 million. You even see contract agreements between unions and leagues though Contract Bargaining Agreements, and these are the agreement between the athletes and the team owners. Since athletes have so much bargaining power when they try to negotiate a new deal with their owners, this leaves many to question whether athletes are employees or independent contractors.

According to the State of California Employment Development Department, a professional athlete is an employee or independent contractor depending on the sport they perform and how much power the athlete is given in their decisions. This is seen internationally. In all team sports around the world, athletes have to report to owners, coaches, and managers which gives them less control over their performance making them employees. Recently, the Indianapolis Colts disciplined their running back, Trent Richardson, for not reporting to the team and showing up in the American Football Conference Final playoff game. The Colts suspended him for two games without pay. It’s up to the coach who will be playing in a game, and who will be benched. Team sport athletes also receive health care benefits from their employers, and have tax deductions taken off their paycheque further proving they are employees. 

In individual sports, athletes are free to make their own decisions making them independent contractors. Individual athletes include boxers, golfers, and tennis players. Recently, professional boxers Manny Pacquiao and Floyd Mayweather Jr. both came together and agreed to fight in Las Vegas on May 2, 2015. They both made the decision individually without any owners or leagues deciding if they could fight against one another. Another recent example of an individual athlete making their own decision is professional golfer Tiger Woods deciding to take a leave of absence from the game to work on his performance. This is even seen in  the sport of tennis. The professional women’s tennis player, Serena Williams, had boycotted the Indian Wells tournament since she felt mistreated by the fans back in 2001. She was not disciplined for not partaking in the tournament for multiple years since she was free to decide when and where she could play. Unlike team sport athletes, individual athletes are responsible for hiring their own medical staff and coaches meaning they do not receive health benefits. 

After understanding the amount of freedom an athlete is given in the professional sport they participate in, it is more evident whether they are an employee or an independent contractor. Contracts are everywhere in sport regardless of whether a professional athlete is an employee or a contractor.