After a shutdown due to the COVID-19 pandemic, followed by months of tense labor negotiations, America’s pastime has finally returned. Major League Baseball (MLB) teams took the field for Opening Day on July 23, but noticeably absent from the belated festivities were the thousands of players who make up baseball’s sprawling minor league ecosystem. These games played in empty stadiums will be a constant reminder of COVID-19’s continued economic and social effects, but the games not played in minor league ballparks should serve as a representation of low-wage workers’ disadvantages, which have been exacerbated in the economic fallout from the pandemic.
The COVID-19 pandemic has revealed how the weaknesses of the US’s employment system disproportionately hurt low-wage workers, especially those in occupations exempted from federal minimum wage standards. Between March and May, the restaurant industry faced losses of $120 billion nationwide, and the US Bureau of Labor Statistics projects 6.1 million food and drink industry jobs were eliminated in March and April. Roughly 68 percent of unemployed workers are eligible for unemployment insurance (UI) that pays more than their jobs, with low-wage workers filing a greater percentage of unemployment claims during the pandemic than higher-wage workers.
Federal minimum wage exemptions are commonly associated with tipped-wage and farmworker professions, but the minor league baseball system (MiLB) illustrates COVID-19’s impact on exempt workers. Thousands of minor league players provide athletic entertainment, just as their major league counterparts do, but reap fewer rewards. Although minor league baseball players make up a small fraction of the minimum wage–exempt workers in the United States, the vast majority make wages below the federal poverty line, making their plight representative of the harm these exemptions perpetuate. Eliminating minimum wage exemptions and extending the expanded unemployment benefits could better protect workers with less income certainty during times of crisis.
Exempted workers are often excluded from safety net benefits despite lacking income security
For workers exempt from minimum wage standards, there are often few safety net protections. Over the long history of American baseball, legislative and legal action have kept protections for minor leaguers to a minimum. Since 1922, Major League Baseball has been exempted from federal antitrust law, with the Supreme Court later ruling that any changes to the exemption must come from the legislature. Congress has rolled back part of the exemption, but those rollbacks don’t apply to minor leaguers, and recent legislation further exempted MLB from paying minor leaguers minimum wages or overtime by classifying the players as “seasonal apprentices.”
Under the terms of the Uniform Player’s Contract signed by minor leaguers upon entering the system, they are only paid during the baseball season (some as short as three months), they cannot sign with other teams, and, most notably, they cannot collect unemployment benefits in the off-season despite not receiving a paycheck. This last scenario is common among independent contractor and gig economy professions, as they are typically excluded from unemployment eligibility.
Gig workers’ relationships with their employers differ from traditional workers in that the work is classified as temporary or project based and is therefore labeled as services to the company instead of direct employment. Reform efforts to allow gig workers greater access to legal benefits are being led at the state level in states such as California, New Jersey, and New York, but only federal reform of the Fair Labor Standards Act could ensure all gig workers, regardless of location, can access benefits.
For many of these workers, earning a living depends on the charity and generosity of their customers or bosses. This generosity often never comes; for example, a study published last October by the National Bureau of Economic Research found nearly 60 percent of Uber customers never tip after taking a trip.
Although most MLB teams approached the shutdown in good faith and paid their minor leaguers weekly stipends, some announced they would discontinue the payments because of lost revenues tied to loss of ticket sales and stadium revenue. The Oakland Athletics originally intended to stop paying their minor league players at the end of May, meaning those players’ next paycheck would not come until April 2021, but the A’s ultimately reversed course. Without a union, minor league players lack an advocate and have nothing to keep teams from withholding their paychecks later on.
How policymakers can ensure a fair wage for workers most at risk during this crisis and beyond
Policy solutions to low wages and unemployment for other industry workers in the US are often complicated and hotly debated. Lawmakers have already taken an important step through the Coronavirus Aid, Relief, and Economic Security Act by expanding unemployment insurance eligibility to include workers typically not covered, such as gig workers and independent contractors. Many believe this includes minor league players as well because of their status as “seasonal apprentices.”
Most players are currently receiving $400 per week in support from their teams, and if they file, they may receive in $600 in federal unemployment insurance, in addition to UI benefits. For many players, the combination of the financial support from MLB and UI amounts to more than their average yearly salaries. With the expanded $600 per week of federal UI set to expire at the end of July, minor leaguers and other low-wage workers may be left with more financial uncertainty unless they receive additional supports.
That minor leaguers can currently make more through social safety net benefits shows how necessary these benefits have been. But these players are just one of many professions in need of better wage protections. According to the Bureau of Labor Statistics’ most recent occupational employment and wage estimates, nearly 63 million workers, including many workers exempt from the minimum wage, make less annually in wages than the current federal unemployment rate ($600 weekly or less than $35,000 annually).
The treatment of low-wage workers in the current economy threatens the livelihoods of thousands and jeopardizes the future America’s pastime. Many players, whether they’re future superstars or just average ballplayers, will have to leave the game they love to search for livable wages in an economy still experiencing record unemployment. If policymakers want to support minor league players and many other low-wage workers, they can reevaluate Fair Labor Standards Act exemptions of minimum wage standards and send a message that all workers are valued, no matter what field they are employed in.
This post was corrected to clarify that players would receive $600 in federal unemployment insurance, in addition to state unemployment insurance. (Updated 7/24/20)