Tuesday, April 2, 2013

Major League Baseball to get rid of non-player pensions

By B. Crawford


There has been reports coming out over the last couple of days that Major League Baseball is planning on cutting out the pensions of anyone that is not in uniform. That is a large group of employees that are covered in that statement; probably every employee from the usher all the way up to the president of the team. People seem very swift to jump all over this and bash Bud Selig for this but the reality is that he is following the model set forth by the majority of private sector jobs. Still, that is a big blow to the employees.

I highly doubt that the commissioner would eliminate the pension program without setting up an optional retirement program, more than likely a very comprehensive program. They will not simply bring to an end the pension plan without offering an alternative. Pension plans are expensive to employers so it seems plausible to offer an alternative if you invest your savings back into employee salaries. If the goal is to line the pockets of Major League Baseball and all thirty owners, that would be bad. Very bad! If I were an employee of Major League Baseball I would be a little worried but not yet in panic mode, I expect that they will be offered a fair alternative.

Like I said earlier, pension plans are rapidly becoming extinct in the business world. It's probably only a matter of time before the government takes a close look at the pension program they offer to their employees. Twenty years from now it in all probability won't be the same as it is today and I don't think that is necessarily a bad thing. Just because employers don't offer a pension plan, or change a pension plan to a secondary retirement plan, doesn't mean they are a crappy employer. It simply means there may be a more beneficial way that benefits both sides, the employee and the employer.

There is little doubt that Major League Baseball is a cash cow that prints money around the clock for all team owners. Even the more modest markets such as Tampa are profitable; however, the gap in profits between all clubs is substantial. If the current arrangement is not beneficial to those profits then, like any other business, they have the right to make it better for everyone involved. I'm sure that each individual club will have the opportunity to set their own plan within a certain set of standards, the downside to that is that subsequently some clubs will be much better employers to work for than others. The cream will rise to the top.

In the end, the right conclusion will be made. One that is good for the employees and employer. By default this will put more money into the pockets of the owners and the league itself, but that is not truly a bad thing. As long as that money in reinvested back into the labor force then everyone has done the right thing morally. Whether they like it or not, Major League Baseball has an obligation to make certain that every employee is taken care of prudently; how they get there should not that big of an obstacle.




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