Posted in: Mr. Tito
MR. TITO STRIKES BACK - Forget Seth Rollins, the WWE Has a BIGGER Issue Looming for the Future
By Mr. Tito
Nov 7, 2015 - 8:09:53 AM

Follow Mr. Tito on Twitter.com: @titowrestling

Welcome to an additional edition of the EXCELLENCE IN COLUMN WRITING... There are times when the news is so plentiful that it inspires me to write... Then, there are times when I just want to write during the weekend. But most of you wanted me to write on the injured Seth Rollins and the revamped Survivor Series 2015 regarding the WWE Title. I was bombarded with requests to comment on Rollins via Twitter... I'll comment on that later, but my good friend Chrisssss has it covered...

Plus, I already wrote that column about WWE's thin bench... Just read THIS COLUMN from 10/13/15 when I was discussion WHO could replace John Cena. Problem, again, is that the WWE has treated their midcard and US/Intercontinental Titles like dogcrap. The midcard should be developed and crafted like an internal farm system just as it was before 2005. Simple pattern of new wrestlers starting low on the card, working their way up to the US/IC Title, winning that US/IC Title, drawing as US/IC Champion, and then getting promoted to the Main Event by drawing in the midcard. Now, WWE introduces every developmental wrestler from NXT as if they were an instant Main Eventer. Idiotic...

So when John Cena takes time off, Seth Rollins and Randy Orton are out with injuries, and Brock Lesnar is out of paid dates... You have NOTHING ready on your bench to be credible enough to step in.

Same problems, different month/year...

But what I want to specifically talk about is a potential Congressional Bill that may significantly affect the finances of the WWE Corporation. If implemented, this bill has real potential to cause drastic changes in the WWE and in the economy in general.

As it stands now, the WWE hires their professional wrestling talent as Independent Contractors. What does that mean? According to the Internal Revenue Service (IRS), an Independent Contractor is defined as a business or contractor who provides services to other businesses and act as self-employed. Specifically, the company or payer pays specifically for the result of the services and has control specifically on what services will be provided or what the worker will exactly perform. Typical example is if you pay for a carpenter to work on your house... You are specifically paying him for this service and other than him performing work on your house, there is no other working relationship. The payment is for the specific service provided and not for an ongoing working relationship in which the carpenter has freedom within their job title to do tasks of their choosing.

Pro wrestlers are contracted to perform at televised, houseshow, and Pay Per View events and they are also paid for appearances. Based on their contractual agreements, and each wrestler negotiates their own, they are required to fulfill any obligations set forth by the WWE Creative Team and the wrestlers cannot dispute it. For a while, the WWE has been able to classify their working relationships as independently contracted and the IRS has had no issue with the WWE's reportings. Ditto with other companies with Independent Contractor relationships.

If you haven't followed the Washington DC beat, you've missed that Senator Sherrod Brown of Ohio (D-OH) has been working to introduce a Bill in Congress that would effectively convert Independent Contractors to Full Time Employees as LINKED HERE but also presented, in part, below:

In Cleveland today, Brown announced plans to introduce new legislation that would close a loophole in the tax code that allows employers to openly treat full-time workers as independent contractors in order to avoid providing them with earned safeguards and benefits – like payroll tax withholding, overtime, unemployment insurance, and workers’ compensation.

"We should call this what it is: fraud," Brown said. "We see it in industries from trucking and construction, to service sectors like landscaping and home health care. If employees are classified as independent contractors, then an employer doesn’t have to pay them overtime or contribute to their Social Security or Medicare benefits. When companies cheat tax law and misclassify employees, workers lose, honest businesses lose, and taxpayers lose. This is unfair to workers, unfair to businesses that play by the rules, and it must stop."


And Brown's website continues further...

By paying workers under-the-table or classifying workers as independent contractors rather than employees under Federal tax law, employers can avoid providing workers with earned safeguards and benefits – like payroll tax withholding, overtime, unemployment insurance, and workers’ compensation. This practice not only allows employers to deny workers overtime, Social Security, or Medicare benefits, but also cheats the Federal government and State of Ohio out of billions in tax revenue, while putting businesses that play by the rules at a competitive disadvantage.

Brown’s bill, the Fair Playing Field Act, would address this by ensuring that full-time employees are no longer misclassified. Specifically, the bill would:

- Require the Internal Revenue Service (IRS) to clarify the rule determining the Federal tax employment status of a worker; and offer guidance to make this distinction easier for employees and employers to decipher;

- End the moratorium on the IRS prospectively reclassifying workers;

- Require employers to notify independent contractors of their tax obligations and the workplace protections that do not apply to them;

- Allow independent contractors who have concerns about their classification to seek a determination of their proper employment status from the IRS;

- Protect professional services employees who are independent contractors by choice from being reclassified; and

- Protect employers who follow the rules by retaining the safe harbor that prohibits the IRS from retroactively assessing a worker’s classification if an employer had a reasonable basis for classifying a worker as an independent contractor.

Employers who have a reasonable basis for their worker classifications will also continue to pay reduced penalties if they are found to have misclassified workers, while employers who violate the IRS misclassification guidance without any reasonable basis will pay higher penalties.


The FAIR PLAYING FIELD ACT... See what could happen to the WWE, folks? Let's say that Brown's Bill gets introduced to Congress, passes both the House/Senate, and gets signed into law by the President. Instantly, the WWE would have to pay FICA and Medicare taxes on their employees and probably be immediately subject to providing Healthcare coverage via the Affordable Care Act. Granted, the WWE has an internal policy of providing medical care and paying for injuries so they are technically paying for healthcare already. However, the FICA/Medicare taxes would greatly increase expenses. Plus, WWE would see more expenditures for Unemployment Insurance and Workmen's Compensation. WWE's 10-K Report for 2014 projects that they employ about 140 independent contractors and much of that talent will hit the $118,500 cap for Social Security.

Overall, it could be an additional expense in the millions annually (taxes, healthcare, compliance to different IRS/Labor laws, etc.) to the WWE's Income Statement and would threaten to compress the profit margin. And of course, the WWE's response would be to reduce expenses to offset those rising employee costs. 140 "independent contractors" would probably shrink OR guaranteed money would be reduced. In addition, the WWE would be more liable for workplace incidents and would be subject to an increased level of workplace safety provisions. Given how most wrestlers work hurt and are slammed hard on that stiff ring, the WWE could be under intense scrutiny. Furthermore, it could nudge WWE wrestlers one step closer to unionizing as WWE employees.

Now, this bill probably won't see the light of day unless Senator Sherrod Brown can pull off a bi-partisan effort. However, the United States is trending towards $19 Trillion in DEBT and Congress could be hungry for more taxes to pour in. By changing the Independent Contractors to Full Time employees, that may have potential to boost payroll taxes. Of course, that may have a dynamic effect if employers cut back on workers as a result of this bill's passage. As it stands, Sherrod Brown's political party, the Democratic Party, does not have the majority in the Senate nor do they have it in the House of Representatives. Democrats have 44 + 2 Independent votes (46) to counter the Republican Party's 54 members. With the Senate rules requiring 60 votes, Sherrod Brown's bill needs help to be heard and passed on to the House. Probably unlikely but that doesn't mean that a bill like this could pass in future years. Brown won't be up for re-election until 2018 and therefore he could keep trying if the Democrats re-capture the White House in 2016 and may gain some seats in the House/Senate. Knowing him as my Senator here in Ohio, he is quite persistent on labor, trade, and financial issues.

Good chance that WWE and other companies who employee heavy amounts of Independent Contractors (FedEx, whom Brown is very critical) have lobbyists in Washington and will fight this bill's passage. WWE has fought hard to remain classified as an entertainment company and would also fight hard to keep their worker classifications in place as well.

Something to legitimately watch in the months and years to come...

================================

SETH ROLLINS = INJURED

Bigtime shame with Seth Rollins getting hurt. Now, first and foremost, the Internet Wrestling Community needs to cool it on blaming Kane for the injury. You act as though Kane took a butcher knife and was using it to shred Seth's knee. Injuries happen and when you're a wrestler that packs additional muscles onto your tendons, they'll snap. Given the high flying style that Rollins has, that potential for a leg injury always exists.

Now, I wonder WHY the WWE still has Seth Rollins wrestling Kane anyway. Isn't their feud over? Seth Rollins beat him at Hell in a Cell 2015 and Kane has since moved on to rejoining his brother to feud with the Wyatt Family. So, why is he still worrying about Seth Rollins when he has 4 bigger fish to fry with the Wyatts? Doesn't make sense booking wise... Plus, Kane doesn't move like he once did and therefore, Seth Rollins has to do more in the ring to make the match look decent. Rollins probably bumps more against the older Kane than other wrestlers and therefore opens him up more to injury. If there's blame to be given to Kane or WWE officials, it's due to the fact that he's old and slow and Seth is told to "do whatever it takes" to make the match look good.

This injury "SAVES" Seth Rollins's career, in my opinion. WWE Monday Night RAW is trending towards losing 1 million average viewers since Rollins became WWE Champion at Wrestlemania 31. And the WWE has made Rollins the MAIN EVENT act of the majority of RAW events with a few exceptions. WWE Network subscriptions have hit a plateau in 2015 although I'd argue that Pay Per Views have been Rollins's best performances. Problem is that Rollins does not have a drawing personality as a heel. Wrestling fans aren't exactly tuning in or attending WWE events JUST to see Rollins get his ass kicked. No, in fact they are turned off by what a wimpy character he appears to be as he bickers with fellow Authority members and just isn't connecting emotionally with his opponents. There's NO HEAT... Worse yet for Seth Rollins, it doesn't help that the WWE has let John Cena dominate him for the most part.

Experiment over... WWE needs to rethink their approach to Seth Rollins as a character. The guy is one of the BEST in-ring performers in the WWE, if not THE best that they have. Guy is amazing in the ring... Therefore, work his character and promos. Rollins biggest issue is being unable to connect emotionally with opponents and with fans. A heel World Champion should piss off enough people that it causes them to tune in to see that heel's downfall. But there was nothing interesting about his run. It's as if Vince McMahon was never satisfied Rollins after other WWE officials talked him out of crowning him WWE Champion instead of Roman Reigns.

So far, the WWE announced that a tournament will be held to crown a NEW WWE Champion at Survivor Series 2015. However, it wouldn't surprise me that the WWE scraps this idea and goes for something like an Elimination Chamber instead. RAW could benefit from having the preliminary or qualifying matches, I suppose. If you ask me, I would crown the next WWE Champion at Royal Rumble 2016 instead. Why do people talk up Royal Rumble 1992 as the BEST ever? OK, that WWE Roster was STACKED back then, but the "sense of urgency" in crowning a new WWE Champion really ramped up the intensity of that match. It remains, to this day, the best Royal Rumble match and I believe the WWE Title helped induce the heat for that match. If you suggest that the WWE couldn't survive without a WWE Champion, then tell me how they did just fine with Brock Lesnar not always defending his title when he was champion?

Question is... WHO should win it? Let's rule out a few people, just due to the booking right now... NOT Brock Lesnar, as his scheduled dates have been used up to the WWE's liking and they'd rather use him for 2016 events between now and Wrestlemania when year #1 expires of his 3 year deal. Obviously, NOT John Cena who is taking time off. Now, if it magically appears on RAW or event at Survivor Series, the odds greatly increase. A BIG PILE OF MONEY could be forwarded his way to "SAVE" the WWE. I wouldn't doubt it... But for now, all indications are that he's still taking time off. NOT Randy Orton who is legitimately injured. Rusev, too, as he has been out with an injury. Reportedly, Alberto Del Rio will be John Cena's return feud during late December.

That thins the WWE bench, big time... That's exactly what I was discussing already in THIS COLUMN from 10/13/15. No strength in the midcard and upper midcard to quickly elevate someone. In the past, the Intercontinental Champion was often good enough to be promoted to the WWE Champion.

If you look at the booking, however, only Roman Reigns makes sense. Seriously... I hate to admit that, but he's the only one consistently booked strong while the rest of the roster has been booked on a 50/50 basis, win one week and lose badly the next. Then you have guys like Dean Ambrose who can only win Pay Per Views if he's against Luke Harper. Seriously. Bray Wyatt could be a good champion, too, but he's been undercut repeatedly. Maybe Sheamus, as he's the current Money in the Bank briefcase holder...

You know, that's a good point. Why can't Sheamus cash in that Money in the Bank briefcase RIGHT NOW?!? The Authority could start the show in attempts to announce a Survivor Series 2015 tournament but Sheamus immediately cashes in. Without an opponent, that's a forfeit... Therefore, Sheamus instantly becomes WWE Champion. It's unique, puts immediate heat on Sheamus because he's taking away a tournament from the fans, and it resolves the WWE Title situation immediately. Now, I'm not preaching that Sheamus should be WWE Champion... But damn it man, the bench is THIN... Who else is actually worthy of the WWE Title and is actually wrestling in November/December? See why my Royal Rumble 2016 idea makes sense?

IN FACT, that's exactly what I'd do... WWE could book UNDECIDED results for the Survivor Series 2015 tournament and also a failed result to crown a WWE Champion at TLC 2015. Those 2 FAILED attempts to crown a WWE Champion would prompt Royal Rumble 2016 to be the ultimate decider of the NEW WWE Champion. It baits fans well for 2 months but at the same time, builds anticipation for Royal Rumble. Then, you can bring back that old Elimination Chamber cage during February 2016 to decide the #1 contender for Wrestlemania 32.

You're welcome, as always WWE, for the free advice...

Just give it to Roman Reigns already and just yet him WIN matches. That's my ultimate advice for any WWE Champion crowned. Champions not named "John Cena" have not been allowed to consistently win as WWE Champion or be allowed to get clean wins over legitimate opponents. Seth Rollins for 2015 and CM Punk for 2012 shows that for weak WWE Champions who couldn't beat any big names or be allowed to be the clear #1 guy on the roster.

Now, I STRONGLY advise against turning Roman Reigns HEEL and making him a "Corporate Champion" like the Rock during 1998, which would have been 17 years ago (I'm getting OLD... And I covered that event as a columnist for LoP, too). The Rock made it work because he had simple things like charisma, amazing microphone skills, and he pulled off the "I'M BETTER THAN YOU" snob persona possibly better than anyone in wrestling history other than Ric Flair or Roddy Piper. Seriously... Rock knew how to draw heat and he was magical on the microphone. Sorry, but his cousin Roman LACKS that same skillset. It would feel extremely FORCED if the WWE tried to turn him heel right now after years of trying to make him the #1 babyface.

That doesn't mean that another guy would become the "Corporate Champion" or the "Authority Champion". Roman Reigns could win at Survivor Series 2015 and then Sheamus cashes in... With the Authority's help, he becomes champion and Reigns can chase Sheamus for a while. Why would Sheamus be a better fit you ask? Just read the internet... Reportedly, Triple H and Sheamus are close... Just look at Sheamus's muscular build and how closely it replicates how Triple H is built. They were workout buddies a few years ago and Triple H pushed hard for Sheamus to win the 2012 Royal Rumble and recently, Money in the Bank 2015. He's one of Triple H's personal favorite performers... So why not embrace that? HHH and Sheamus could fawn all over each other on RAW to generate actual heat. See how that works? You take something that reportedly exists and you turn that notch up to 11 for intensity.

I think that Roman Reigns and Sheamus would be reasonable for a 2-month trial period until January 2016 arrives. If neither are working, just create their opponent from the Royal Rumble match. That simple.

WWE could be in much worse shape... At the very least, they have John Cena and Brock Lesnar coming back in January and will probably bring back more WWE veterans for the HUGE Dallas 100,000+ fan show Wrestlemania 32.

Oh that's right, we're relying on WWE veterans again...

If only WWE had a show that actively developed talents... I must say, I really enjoyed the ending to NXT this week with a fantastic match between Finn Balor vs. Apollo Crews that had 2 big impact guys getting involved in Baron Corbin and Samoa Joe. That's quite the cluster of talent right there...

It's not as bad as you think for the WWE...

SO JUST CHILL... 'TIL THE NEXT EPISODE!

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