Earlier this month the UFC excited controversy with an exclusive $70 million dollar sponsorship deal with Reebok. Before this deal, fighters could pursue their own sponsorships individually, and revenue from these endorsements made up for the lack of compensation from the UFC for fights.
Since inking the contract with Reebok, the fighters, who were not brought to the table in crafting this deal, are barred from wearing any insignia or sports apparel from other companies during fights and other official UFC events.
Due to the UFC tier system, fighters on the lowest tier earn only $2,500 per fight, and in some cases, the Reebok apparel is their payment in lieu of monetary compensation. This has caused many fighters to lose tens of thousands of dollars in compensation per fight.
Women fighters, in particular, face the prospect of losing out.
Previously relegated to smaller fighting leagues, 2014 brought women fighters into the UFC. An entire division was formed around star-attraction Ronda Rousey, who quickly rose to be a fan-favorite, ironically since UFC president Dana White had stated there was no place for women in the league.
The newness of this division means that women fighters have the potential to see the most damage from lack of compensation. Bantamweight Sara McMann researched and found that 86 percent of women fighters in the UFC could be negatively impacted by the deal.
In light of this, she has initiated a Title IX lawsuit, which pinpoints the gender-based discrimination that has resulted from this system.
“It would be the equivalent if this were the civil rights movement and you decided to hire minorities and then you instill a policy that said the only way you can be applicable for a raise is if you have been with the company for five years,” McCann said to MMAFighting.com, “Well, automatically every single minority would be out of that running.”
According to research, 61percent of the fighters overall (both genders) have the potential to be adversely affected under the new system.
The UFC is the sport’s premier professional league, and was formed through consolidation of several smaller leagues, which were gradually purchased and absorbed by the parent company, Zuffa LLC. Zuffa is majority-owned by Frank Fertitta III and Lorenzo Fertitta, executives of Station Casinos. Dana White, president of the UFC, is a minority owner. The other minority owner is the government of Abu Dhabi.
As the sport attracted mainstream attention, pay-per-view revenue and other business deals exploded. UFC is protective of information about its profits, but by 2008 the Fertittas were offered over $1 billion to sell the company to private equity or media firms. Currently, the company is thought to be valued at closer to $2 billion.
The owners are equally close-mouthed about fighter compensation. However, in recent years, the fighters have been less reserved about how lopsided their income is in relation to other comparable sports performers. In 2014, fighters filed a class-action lawsuit, claiming that UFC restricted their earnings through monopoly practices.
The UFC buying up smaller leagues such as Strikeforce also makes it tough for fighters to now find fights outside the UFC umbrella.
“The 800-pound gorilla can’t stand up to 500 fighters,” said Nate Quarry to Sherdog.com, in speaking of the need to sue for damages as a group.
All fighters are considered independent contractors, and get no real benefits. Despite this, the UFC takes advantage of the lack of competition to levy conditions on its fighters that could be considered as an employee/employer relationship.
Michele Roberts, the NBA players’ union executive director, stated, “There. Would. Be. No. Money. If not for the players. They create the game.”
Last year’s class-action lawsuit and the Reebok deal have reignited conversations about a fighter’s union. Bloody Elbow’s Why Isn’t There A Union In MMA? outlines the potential challenges facing a fledgling union, including the fact fighters do not congregate in the same manner that team sports members do, hampering traditional organization methods.
However, on May 31st, Featherweight Jose Aldo spoke out in a passionate call for a union in the face of the Reebok deal. “If we had a union for fighters, and we were all together, like in the NBA, this would’ve been different. But fighters are not united… The UFC brought the sport to where it is today, great, that’s their merit. But if athletes were more united and had a union to protect them, I don’t think this would happen.”
UFC President Dana White dismisses the idea of the union, maintaining his contention that the UFC, being smaller than the NFL or NBA, would not be an appropriate league for organization. “The UFC isn’t making the revenue that the NFL and the NBA are,” said White. “…the fighters are getting paid every time they fight.”
Being classified as independent contractors has been a barrier in the past to unionizing, but new strictures, including a new drug-testing policy and Code of Conduct, on a fighter’s behavior means one avenue to examine is if the new policies constitute an employee relationship under labor law, which could lead to reclassification.
“The more control they exert, the more it looks like an employment relationship.” said labor expert Professor Zev J. Eigen, in talking of the UFC.
Photo: Bantamweight Sara McMann, UFC.