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Jockeys at Puerto Rico's lone horse-racing track have been paid the same amount since 1989; a $20 "mount fee" for each race and a share of the prize money if they finish at least fifth.
Unsurprisingly, they became fed up with the low pay and other work conditions at the track. In 2016, when attempts at negotiation failed, they made the most decisive play most workers can make: They didn't show up.
Thirty-seven jockeys refused to register for races, forcing track operators to cancel three days of racing. Racehorse owners and the racetrack operator filed suit in federal court, arguing that the refusal to race was a boycott that violated federal antitrust law. The district court agreed, granting a motion for summary judgment by the racehorse and track owners and saddling jockeys with a bill for more than $1 million in damages.
But earlier this month, the First Circuit Court of Appeals reversed.
It's not uncommon for labor law to throw a wrench in antitrust policies. Antitrust seeks to maximize competition, while labor policies encourage cooperation.
In most cases, the Sherman Antitrust Act prohibits competitors from engaging in a group boycott. This law prevents companies from banding together to fix prices or push another competitor out of the market. However, if the "price" a group is looking to influence is worker's wages, that's a horse of a different color.
To encourage worker organization and allow for collective bargaining, Congress has consistently exempted labor disputes from antitrust law. Under the Taft-Hartley Act, a labor dispute includes "any controversy concerning terms or conditions of employment."
The district court concluded that the jockeys did not qualify for exempt status because they were independent contractors. However, as the First Circuit points out, a labor dispute can exist regardless of the type of relationship between worker and employer. Moreover, a labor organization doesn't have to be a formally recognized union to fall under the labor dispute exemption.
Concluding the group of jockeys was indeed a "labor organization" seeking higher wages and safer working conditions, the First Circuit overruled the district court's finding that they engaged in an illegal boycott. The panel remanded the case with instructions for the district court to dismiss the complaint.
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