A hockey fan's guide to the NHL lockout
Executive Director of the NHL player's association Donald Fehr at a press conference in Toronto on Thursday, August 23, 2012. The labour talks will continue in New York next Tuesday. (Veronica Henri/QMI Agency)
- Gary Bettman, NHL Commissioner
- Bill Daly, Deputy Commissioner
- Bob Batterman, Chief Legal Counsel
- Donald Fehr, executive director NHLPA
- Steve Fehr, outside counsel
- 30 team player reps
Cap and Crunch
Like rock and roll, the salary cap is here to stay. Which the players seem to realize, though Donald Fehr romanticizes about baseball's relative labour peace without cap strife.
Some marquee teams are comfortable with the cap cracking the $70 million U.S. mark as was projected for this season but the rapidly rising floor, now up to $54 million, has hurt both conservative-spending teams, especially those in financial peril. Attempts to alter the cap's parameters means adjustments in several areas of contention that are listed below.
Doing away with the floor entirely would be a godsend to some teams, but wouldn't help their chances of improving through free agency and would only strengthen the richer teams.
A 57% take of league revenues helped cushion the blow for players of accepting the once unthinkable hard cap. But with league revenues growing around 7% a year, the players' share can no longer be tolerated by owners.
The owners not only rebuffed the notion of an even split of money, they're squeezing the players to drop their share to 43%. So the players are trying to ease that pain and -- they claim -- help the owners save themselves.
A big tenet of the players' much-hyped alternate view is to limit cap increases to 2% in the first year, 4% in Year 2 and 6% the following season. The players say that represents an $800 million saving in three years, but they'd go back to collecting their 57% in the fourth year of the deal.
Hammering players on revenue sharing is the trendy thing to do in the NFL and NBA, where workers were talked as low as 46% and 50-50 respectively.
Some reports peg each percentage point in revenue being worth $30 million.
What's in the pot?
The players argue that NHL revenues are calculated much differently than other sports, which have lucrative national broadcast deals. If you buy the players' argument, there's already a 50-50 split.
Each side is trying to define exactly what is hockey revenue, which involves many ancillary streams on the owners' side that they've been reluctant to divulge. Some revenue generators that have been in the mix are ones the owners now want excluded, which poses a further drop in monies for the players.
The NHL needs to bail out its 15 have-not, or small-market, teams, but few can escape their welfare state when they don¹t have location, on-ice success or corporate sponsorship and ticket sales to compete with the marquee franchises. With the financial relief now approaching an estimated $200 million, Bettman must change the system, but with the players bearing the brunt of funding.
Fehr is looking to overhaul the system, too, but save his constituents from a haircut.
HIGH COST OF FREEDOM
In an audacious opening move, the owners proposed keeping players under their contractual thumb for 10 years before they can become unrestricted free agents, up from the current seven years. Talk about a pox on the already sluggish movement of UFAs on July 1.
They also want a five-year maximum on any contract. Yes, some of this same group rubber-stamped recent 13-year deals in the $100-million range, but have realized it's time to get the horses back in the barn.
As the previous CBA ended, not only did general managers pay big time in hopes of putting their teams over the top, they mired themselves into multi-year deals with dubious cap ramifications. As for keeping stars on their own teams, Sidney Crosby might be worth a huge payout, but teams were stretched to the cap just trying to keep second-tier players in the fold.
The winner in all this was the players, who have no interest in seeing "fair market value," restricted by such measures as increasing the age before attaining UFA status or extending the length of basic contracts.
This is a portion of a player's salary held back to make up for any shortfall after the 57-43 revenue split is calculated. You pay in relation to your personal salary, currently about an 8% deduction. But it usually shakes out in favour of the players and, heading into this season, they were advised to put their 2011-12 escrow into a contingency fund for a lockout.
The escrow account is influenced by factors such as time spent on the injured list, but would really take a hit if the player revenue falls under 50%. The league could also push to keep the current system or expand it, in exchange for players giving back in other areas.
Players will often grandstand that their tough stance in CBA matters is not for their benefit, but for the future of the game. However, rookie salary caps often see newbies thrown under the bus in major sports.
In the NHL, those in the first three years of service on an entry-level contract start at less than $1 million of base salary. Owners now want those savings spread over the first five years of an ELC.
BYE BYE, BUYOUTS?
Owners want the process of jettisoning unwanted players streamlined and there could be a move on the league's part to copy the NBA's "lack of skill" clause. It would be cheaper than the current exit strategy, which costs two-thirds the salary over twice the years remaining on the deal. The league might push for an early autumn buyout period, where costly, tardy, out-of-shape or aging players can be immediately cashed out, so not to be a drag on the club through the season.
Salary arbitration -- that nasty business when players can't agree to new deals and must hear their own team belittle them -- is once more being debated. But with many players successfully arguing that their numbers are comparable to well-paid peers, the league wants this process tossed out.
HEALTH COMES FIRST
As the CBC's Elliotte Friedman points out, the death of Minnesota's Derek Boogaard shone a light on sleep-deprived players worn down by the demands of the job and the frenetic NHL schedule.
Boogaard's death was an accidental overdose of painkillers and alcohol, but the league's system of random testing for illegal drugs has been under fire for years as ineffective at catching cheaters.
CROSSING THE POND
The International Ice Hockey Federation hoped the NHL¹s participation at Sochi in 2014 would be settled by now. But it¹s still in limbo, a possible pot-sweetener for Bettman if players are grumbling at the end of the talks.
The league and even some players have reservations about how the Olympic tournament will benefit them this time around, given the compressed schedule at home. But European players will be in a lather if the league skips Sochi, unless there is another World Cup-style event in the cards.
IN AN EXPANSIVE MOOD?
A possibility of a 31st and 32nd team during the lifetime of the next CBA exists. But it¹s a total grey area as to how much the players get or if the league will even allow them any of the gravy.
CUP RUNNETH OVER
Fehr has revived the idea of bigger payouts to Stanley Cup winning players.
"We want the post-season playoff pool back to where it was before the lockout," he said. "What an NHLer gets for winning the Cup is massively smaller (than other sports). Those (bonuses) come out of the player pool anyway, so it¹s not a major cost item."