A couple of weeks ago, the idea that the pro sports calendar worldwide would be put on hold indefinitely due to the coronavirus might have been thought of as dramatic or alarmist. However, when Rudy Gobert of the Utah Jazz tested positive on March 10 for the coronavirus, the NBA (with good reason) suspended league action immediately (CNN). That proved to be the first domino to fall in a series of cancellations which has seen European soccer leagues suspended (ESPN), the Major League Baseball (Deadline) and Formula 1 season delayed (BBC), and the postponement of Euro 2020 to the summer of 2021 (The Guardian). Given these events, it would not be an exaggeration to say that the coronavirus has had a significant impact on the sports world. For fans of pro sports, the impact of these cancellations and delays might result in a loss of a source of entertainment. However, within the world of pro sports, these cancellations and postponements have significant economic ramifications outside of the sporting arenas that impact various facets of the industry.

In every city that hosts pro sports, large sporting events are a huge source of revenue generation—both for the teams themselves in the form of gate receipts, and as a result of commercial activities at the event. The massive loss of revenue caused by the suspension of pro sports is bound to pose a significant problem for the business interests of many localities. Most large, top-tier professional teams are in a position to absorb the losses from such cancellations, especially given their higher dependence on television revenue. However, the second-tier teams—which form a vital part of the pro sports structure—may be more significantly impacted, as a larger share of their revenue is derived from actual game day activities. Lower-division teams that are struggling due to the recent lack of revenue may be unable to pay guaranteed salaries to players in the short term, and, in some cases, may even be driven to insolvency or bankruptcy. A collapse in the internal structure of pro sports will have far-reaching consequences (The Guardian).

Looking at the situation from an employment perspective, pro sporting events generate employment for a significant number of people, either in a full-time or part-time capacity. With the cancellation of these events, teams may look to reduce the number of employees on their payroll. Part-time employees will almost definitely be rendered unemployed. This will prove to have a significant effect on the livelihood of workers who depend on these part-time jobs to make ends meet. The indefinite nature of the postponements and cancellations only adds another dimension of uncertainty to the lives of affected employees (Des Moines Register).

In the face of the current, widespread uncertainty, some hope may still be derived from the response of the largest organizations in the pro sports industry. Dallas Mavericks owner Mark Cuban has taken the lead, announcing that hourly employees would continue to be paid through the end of March as if the scheduled games had taken place (Forbes). Likewise, several pro teams in various leagues around the world have announced that they will continue to support matchday staff and temporary workers in order to minimize any financial uncertainty these workers may face as a result of event cancellations (CBS Sports; Reuters; Seattle Times). Similarly, some lower-division leagues are taking steps to provide relief packages to teams struggling to cope with the short-term financial burden of the cancellations (The Guardian). With sporting institutions worldwide being threatened in an unprecedented manner, these represent important steps in the response by the sports industry to the coronavirus. This collective action by sports organizations needs to be kept up for as long as events remain unable to resume. For the moment, these acts of solidarity by pro teams signal optimism that sports fans around the globe will be able to return to their favorite sporting events in the future.


About the Author
Vishnu Rege is an LL.M. student at the University of California, Berkeley, School of Law. At Berkeley Law, Vishnu is also a member of the Berkeley Technology Law Journal and Patent Law Society. Prior to Berkeley Law, Vishnu worked as an IP lawyer in India for 4 years.