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On October 19, 1998, Grievance Arbitrator John D. Feerick declared that the National Basketball Association (NBA) is not obligated to make salary payments during a lawful lockout.

On June 30, 1998, the NBA terminated its Collective Bargaining Agreement with the National Basketballs Players Association (NBPA). On July 1, 1998, the NBA began a lockout during which it refused to pay players any salaries that would become due for the 1998-99 basketball season. In anticipation of this action, on June 30, 1998, the NBPA filed a grievance claiming that the NBA breached the contracts of more than 200 players whose contracts were fully guaranteed for the 1998-99 season.

The NBPA sought to commence an arbitration with the NBA to resolve the status of whether players with guaranteed contracts should be paid during a lockout. However, the NBA would not consent to the use of an arbitrator. The NBA contended that since the Collective Bargaining Agreement had been terminated the dispute was not arbitrable. Further, the NBA argued that even if it was arbitrable, Feerick did not have jurisdiction over the matter because he was only authorized to serve for the duration of the Collective Bargaining Agreement.

On August 4, 1998, Feerick rendered a decision stating that he had jurisdiction and that the dispute was arbitrable. Feerick's decision was based on the fact that the Collective Bargaining Agreement and the Uniform Player Contract expressed that any dispute should be resolved by a Grievance Arbitrator. In addition, the NBPA grievance was filed prior to the termination of the Collective Bargaining Agreement, which was during Feerick's term as Grievance Arbitrator.

Next, Feerick addressed the issue of whether the players were entitled to be paid during the lockout. In coming to a resolution, Feerick took into consideration the parties' Collective Bargaining Agreement, individual player contracts, bargaining history, past practice, and principles and policies of federal labor law.

Under federal labor law, unions and employers may utilize certain economic weapons to support their bargaining positions. The right to lockout employees, along with the right to strike, is well established and firmly grounded in federal substantive labor law. Case law reveals that during a lawful lockout employers can withhold the wages or salaries of employees. As with many economic self-help rights, a lockout may be waived by agreement of the parties. However, the NBPA did not satisfy the clear and unmistakable waiver standard established by the National Labor Relations Board with respect to limitations on economic self-help. As a result, in interpreting the Collective Bargaining Agreement, Feerick concluded that the NBA did not waive its right to an effective lockout.

Feerick then found that the Uniform Player Contracts were controlled by, dependent upon, and closely intertwined with the Collective Bargaining Agreement. The language of the Collective Bargaining Agreement clearly states that the Uniform Player Contracts shall be governed by the Collective Bargaining Agreement. Feerick also stated that the Collective Bargaining Agreement superseded the Player Contract. Therefore, after the Collective Bargaining Agreement was terminated the salary provisions of the Uniform Player Contracts are no longer in effect.

During the course of the collective bargaining history, there have been threats of strikes and lockouts, with an actual lockout occurring in 1995. Throughout the bargaining history, the NBPA has never claimed that players have a right to be paid during the lockout. If the NBPA believed that the NBA had a right to withhold salary payments during the lockout in 1995, any intent to change that practice should have been included in the current Collective Bargaining Agreement.

Therefore, since Feerick was the designated Grievance Arbitrator outlined within the Collective Bargaining Agreement and the Uniform Player Contracts, he had jurisdiction to hear the dispute between the NBA and the NBPA. In the end, upon consideration of the law, the interpretation of the collective bargaining agreement, and the testimony of both parties, Feerick concluded that the salary provisions of the player contracts were not effective during a lawful lockout following the expiration of the collective bargaining agreement.

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