What Mediation Means for U.S. Soccer, USWNT in Gender Discrimination Lawsuit

The U.S. women's national team and U.S. Soccer have agreed to mediation in regards to the players' gender discrimination lawsuit, but that doesn't necessarily mean a swift resolution is on the horizon.

Could the multiyear legal fight between U.S. women’s national team players and the U.S. Soccer Federation over pay equity and workplace dignity be nearing an end?

As first reported by the Wall Street Journal, attorneys for U.S. Soccer and the 28 USWNT players suing the federation have tentatively agreed to mediation after the 2019 Women’s World Cup concludes on July 7. The ongoing battle hasn't negatively impacted the team on the field: it won its three group stage games by a combined 18-0 score and looks ahead to a round-of-16 clash vs. Spain on Monday.

After the conclusion of the tournament, though, the focus will shift entirely back to the equal pay fight. Here's what the latest development means:

The core issues

Over the last four years, the players referenced above have engaged in a variety of legal actions. They include filing a charge of discrimination with the U.S. Equal Employment Opportunity Commission and suing U.S. Soccer in the U.S. District Court for the Central District of California. In addition, former U.S. goalkeeper Hope Solo has sued U.S. Soccer in the U.S. District Court for the Northern District of California and raised very similar arguments. Meanwhile, in 2017, the USWNT Players’ Association and U.S. Soccer agreed on a new collective bargaining agreement that ensured games would continue to be played. However, the new CBA failed to resolve many areas of grievance that continue to be the focal point of acrimonious court filings and divisive rhetoric.

The players’ core argument is that U.S. Soccer, which employs both the U.S. men's and women's national team players, has engaged in illegal workplace discrimination on the basis of gender.

This alleged discrimination has been reflected in decidedly lower pay for women players. To that end, USWNT players contend that they earn as little as 38% as USMNT players in similar working situations. USWNT players have also drawn attention to inferior working conditions. They insist that they have experienced lower-quality travel, second-rate training facilities and more dangerous playing conditions.

Salary and workplace discrepancies have been particularly glaring in light of the global dominance of the U.S. women, especially in comparison to the lack of relative success by their male counterparts.

Such success has also carried revenue-implications. The Wall Street Journal recently audited U.S. Soccer financial statements and found that between 2016 and 2018–after the U.S. women won the 2015 Women's World Cup–USWNT games generated $50.8 million in revenue while USMNT games generated 2% less, $49.9 million.

USWNT players thus feel confident in arguing that pay disparities are not only unfair in terms of gender but also in terms of sheer results.

The key legal arguments

The players’ legal arguments have centered on two core claims. First, they charge that U.S. Soccer has violated the Equal Pay Act. This federal law makes it illegal for employers to differentiate employees’ wages on the basis of sex.

The Equal Pay Act sounds straightforward in principle, but its application tends to generate debate and complexity. To that point, establishing that female employees are paid less than male employees does not automatically establish that the employer broke the law—there must also be proof the differences stem from illegal discrimination.

Employers accused of Equal Pay violations usually insist that there are lawful explanations for differences in pay between male and female workers. For instance, employers sometimes contend that pay variances merely reflect variances in job position descriptions and in the essential skills or educational requirements for those positions. Other employers vow that pay differences which on the surface appear connected to sex are in reality innocent byproducts of the employer’s seniority and merit-based pay systems.

The players also contend that U.S. Soccer is in violation of Title VII of the Civil Rights Act of 1964. In the same vein of the Equal Pay Act, Title VII makes it illegal for employers to use the gender of workers to determine their pay. Employers accused of Title VII typically offer evidence to rebut the assertion that gender played any role in pay calculations. For instance, employers cited supervisors’ evaluations of employees to distinguish them on bases other than their sex.

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The key legal defenses

U.S. Soccer has flatly rejected these and related claims brought by the players. U.S. Soccer’s leading defense is that USWNT players negotiated the very rules that they are now contesting.

Indeed, the players’ associations for USWNT and USMNT players have collectively bargained economic systems that compensate women players differently than male players. First, consider USMNT players. Their union has negotiated a “pay-for-play” system of compensation, which is what it sounds like: the male players are paid when they play but not when they sit. USMNT players must thus be on the roster to be pay eligible. USWNT players, in contrast, are guaranteed pay.

These two compensation systems, which were outlined by U.S. Soccer in its official response to the lawsuit, benefit some players and disadvantage others. In a “pay-for-play” system you better play; in a guaranteed pay system, there is less of a need to play. However, U.S. Soccer stresses those outcomes are unrelated to player’s gender and are instead byproducts of different ways of compensating employees. Further, the players’ unions negotiated these systems. This type of argument thus implicitly directs USWNT players to blame their own union for negotiating a system that pays them in ways they find unacceptable.

Further, U.S. Soccer has stressed that pay differences in the World Cup and other international tournaments are outside of its authority. For instance, while prize money from the 2018 World Cup totaled $400 million, the total prize money for the 2019 Women’s World Cup is $30 million—less than 10% of the amount. Tournament prize money, however, is not determined by U.S. Soccer. FIFA awards the prize money. It also calculates prize money based on various factors, including relative sizes of sponsorship deals, broadcast contracts and other revenue sources.

An agreement to participate in mediation is not an agreement to settle

The willingness of the players and U.S. Soccer to mediate is a positive development in terms of their chances at identifying a potential resolution and averting a trial. Also, it is usually helpful for parties or their attorneys to meet in person and discuss grievances face-to-face, rather than trade emails where one wrong word can undo substantial progress.

Still, the decision to mediate should not be construed as a settlement or a sign that a settlement nears. It is a fairly low-risk move that often doesn’t yield meaningful results.

Mediation, unlike arbitration, is only effective when all sides to a dispute agree to a proposed solution. Mediation involves a mediator, who functions like an arbitrator or, to a lesser extent, a judge, in that the mediator hears competing perspectives and reviews accompanying statements and empirical data. Mediation is done in private, often in a conference room. It is more like a guided discussion than a formal trial. It is also entirely confidential.

Unlike a judge or even an arbitrator (whose ruling or “award” is legally binding on the parties), a mediator can’t compel the parties to do anything. He or she only hears competing arguments and then, in most cases, recommends a set of terms for the parties to consider.

The mediator’s recommendation is just that: a mere suggestion. U.S. Soccer and the players would need to contractually affirm the recommendation by assenting to a written settlement that captures recommended terms. The parties would then petition to withdraw their litigation from federal court.

However, if the parties don’t agree to the mediator’s recommendation, or if they don’t use it as a guidepost to find their own settlement, their mediation will be considered a failure. Their litigation against one another would then resume.

A mediated solution in this dispute is also not a simple matter.

It’s clear USWNT players seek higher pay so that their compensation is equal to, or at least in the same ballpark as, USMNT players. Yet accomplishing that objective is not as straightforward as U.S. Soccer agreeing to pay the USWNT players more money.

U.S. Soccer and the players would need to agree not only on the amount of a pay increase but on how it would be paid, when it would be paid and in which ways payments would be distributed.

Here are some of the likely questions that the two sides will need to answer:

• Would any pay increase be immediate or would be it be phased in gradually over a period of years? In that same vein, would the rate of pay increase affect the total amount paid? These questions are important when considering the demographics of USWNT players. Relatively older USWNT players would likely want pay increases to be more immediate since their window to play may be coming to a close. In contrast, younger USWNT players might be more willing to wait for larger payments.

• Would USWNT players benefit equally from raises? If so, what does “equal” mean in this particular context? Does it mean each player gets the same dollar increase or would the increase be pegged to a percentage of existing salary? Those two methods could lead to two very different sets of dollar figures.

• Would pay raises reflect merit—that is, would the “better” players on USWNT get more because they are higher achievers and are more productive performers? Or would pay increases reflect a more communal or socialistic model where the players who earn the least get the largest increase because they “need” more? Either of those approaches is possible and each emphasizes different values and ideological views. This highlights how an agreement by U.S. Soccer to pay USWNT players more would raise distributional questions that might incite internal debate among USWNT players.

• Would the CBA between U.S. Soccer and the USWNT Players’ Association need to be amended to reflect any changes generated by a litigation settlement? The CBA is itself a legally-binding contract. It governs the working relationship between USWNT players and U.S. Soccer. For U.S. Soccer, the CBA extinguishes the risk of other legal concerns, including the possibility of antitrust litigation. Any changes to the players’ working conditions would need to be captured in the CBA through amendments. Amending a CBA is not an insurmountable hurdle—other pro leagues and their respective players’ associations do it on occasion. However, attorneys for both sides would need to agree on modifications in order to memorialize salary changes. Such discussions can encounter unexpected complexities.

• Does U.S. Soccer want to set a precedent that it is willing to change a CBA in the players’ favor after the players’ union already agreed to follow it? One argument that U.S. Soccer attorneys have likely expressed to U.S. Soccer executives is that if U.S. Soccer consents to pay USWNT players more than they are contractually awarded through the CBA, U.S. Soccer opens the door to this type of fact-pattern re-occurring in the future—including with USMNT players and their union.

• To what extent will revenue generation impact any pay increases? USWNT players and U.S. Soccer have offered contradictory narratives over whether USWNT players are paid more based on revenue generation attributed to their play. To the extent degree of revenue generation influences any pay increases, the two sides will need to find common ground on how that topic is empirically measured.

• Would Hope Solo’s lawsuit be resolved by the mediation? Solo has brought her own case, which is in the process of being consolidated with the litigation brought by the 28 players. It’s not clear if any successful mediation would resolve her case as well.

It’s also worth noting that the players and U.S. Soccer have tried mediation and settlement talks before, without success. According to the Wall Street Journal, the two sides met on March 27 for settlement talks, and it proved unsuccessful. They may have also previously engaged in mediation through the EEOC process, which normally features attempts to mediate dispute. If they did, then that process, too, failed to yield a settlement.

Lastly, the two sides aren’t even on the same wavelength in terms of their agreement to mediate. A spokesperson for U.S. Soccer told the Wall Street Journal that the organization is “disappointed” USWNT players’ representatives have leaked to media that they will engage in mediation, which as noted above is intended to be confidential.

None of this is to say that mediation will fail. But it should be viewed as a relatively long-shot method to resolve many years of disagreement.

Michael McCann is SI’s Legal Analyst. He is also an attorney and Director of the Sports and Entertainment Law Institute at the University of New Hampshire Franklin Pierce School of Law.