WWE Superstars Would Be Insane Not To Unionize Following $2 Billion In TV Deals

[Bob-O]

Source: Forbes
-Alfred Konuwa

The most important person to all of WWE right now might be Leslie Smith.

She's the recently released UFC fighter who's taking the UFC to court in hopes of the multi billion-dollar fight organization reclassifying its fighters as employees, which would naturally lead to the unprecedented unionization of fighter while opening the floodgates for wrestlers to follow suit.

WWE has thrived financially in part due to its fear-based political structure that allows the monolithic conglomerate to rule with an iron fist and retaliate against the slightest insubordination at will.

WWE Superstars are systematically trained to fall in line through the education (read: brainwashing) of fruitless unwritten rules—the subject of a mostly satirical book released in 2017—and leveraging of their childhood dreams.

The ghosts of discipline haunt WWE locker rooms on a year-round basis through scary industry terms such as “backstage heat,” and everything from smiling on camera to failing to shake hands with an old-timer could be subject to termination without representation.

With WWE set to reportedly make over $2 billion from television deals alone over the next five years, there is no time for WWE Superstars to unionize like the present. Unfortunately, no WWE Superstar has dared to even broach that subject from within its punitive halls, so this long overdue labor relations fight must catalyze from outside Stamford, Conn. From people like labor attorney Lucas Middlebrook and Leslie Smith.

Smith’s predicament in UFC is no different from that of your everyday WWE Superstar. In fact, in WWE, it might be worse. WWE Superstars are classified as independent contractors, meaning WWE has no responsibility to pay them pensions, benefits, insurance or taxes. WWE Superstars are also responsible for their own travel expenses and costs to buy their ring gear.

As an employer, this questionable caveat saves WWE millions of dollars, but in addition to enjoying the financial benefits of an employer, WWE also enjoys full exclusivity to contracted performers, one which directly contradicts the nature of an independent contractor.

Despite their independent contractor status, WWE Superstars cannot compete for outside promotions or make outside appearances without approval from WWE. WWE Superstars essentially enjoy the worst parts of being an independent contractor with none of the benefits. This issue of misclassification is at the center of the Leslie Smith case, and should she prove victorious, this budding issue could turn up the heat—front-and-center—on WWE for its own suspect labor policies and pay structures.

Of course, the push for a WWE union would bring about the potentially messy dilemmas of work stoppages, the cancellation of live TV tapings, offseasons, strikes, scabs and standoffs. The rewards, however, would be worthwhile.

In the 2016 calendar year, Brock Lesnar was WWE’s highest-paid Superstar, with a salary of $12 million per year. That year, WWE reported record revenues of $729.2 million, meaning Lesnar’s salary accounted for under 2% of WWE’s total revenues. With WWE’s new television deals for Raw and SmackDown Live, it stands to tip the scales at over one billion dollars in total revenues beyond 2019, meaning Lesnar’s $12 million salary—which is not mandated to increase with company revenues in the non-unionized WWE—would amount to a measly 1.2% of WWE’s total revenues.

Compare this to the NFL, NBA, Major League Baseball and the National Hockey League, all of which have unions and established pay structures. Quarterback Matt Stafford’s league-high 2017 salary of $27 million represented 8% of the Detroit Lion’s total revenue in 2017. Steph Curry’s $34.7 million salary accounted for just under 10% of the Golden State Warrior’s total revenue in 2017. All told, none of the highest-paid players in any of the four major North American sports were paid less than 6.5% of their team’s annual revenue. With no pay scale to speak of, and a near-monopoly in the world of national pro wrestling, WWE’s dominant leveraging position allows it to pay WWE Superstars whatever it wants.

Leverage has been the key word in WWE’s recent financial gains. As a content provider in the age of cord cutting, the promotion shrewdly leveraged its coveted live event model against network television’s need to stay competitive against streaming services. As a result, Fox paid $1.025 billion for SmackDown Live. The promotion leveraged NBCUniversal against Fox and other suitors in a bidding war, knowing full well USA Network needed WWE Raw to remain relevant as a cable television network. That leveraging led to a $1.325 billion deal to keep Raw on the USA Network.

WWE will have all the leverage in the world in just about every financial negotiation as long as criminally underpaid, underrepresented and unspoken WWE Superstars remain quiet in times of historical financial prosperity.

That is unless Leslie Smith gets her way.