• SHARE:
  • email
  • Bookmark and Share

CBA sticking points: The players' cut & team-by-team revenues

By Nicholas J. Cotsonika

As the NHL and the NHL Players' Association prepare for collective bargaining, this much seems clear: The key issue for the league will be the players' percentage of revenue, and the key issue for the union will be how the teams generate and share their revenue.

No one will say that, of course. Not yet. The league and the union haven't outlined their positions to each other, let alone the public, and are a long way from scheduling their first formal negotiating session. The current labor agreement doesn't expire until Sept. 15.

Both sides were reserved in their words during all-star weekend, careful not to assume anything before bargaining, sensitive to the fans' fears of another labor war like the one that erased the 2004-05 season.

"I have no idea whether we see the world the same way, or whether we see it a little bit apart, or whether we see it a long way apart," said NHL deputy commissioner Bill Daly, "and I really won't be in a position to really handicap [the potential for conflict] until we sit down."

We do know some things, though.

The NHL has done a comprehensive review of the current CBA and has been ready to negotiate for months. One team executive said the most important issue is the players' percentage of revenue, because once you determine that, most everything else – the structure of contracts, free-agency rules, arbitration rights – just determines how their share is distributed among them.

NHL commissioner Gary Bettman said the league is on pace for another year of record revenue. So why are some teams still struggling financially? The league likely will argue the size of the pie doesn't matter if the players' slice is too big. NHL players receive 57 percent of revenue. The NFL and NBA – the other major leagues with salary-cap systems – each got their players to accept about 50 percent last year.

NHLPA executive director Don Fehr brought up a third example. The former leader of the Major League Baseball Players Association noted that baseball – a sport with no salary cap and "much more sophisticated and detailed revenue sharing" – went through its third straight negotiation without a work stoppage. He said he was not suggesting reporters use baseball as a role model, only that they include it in their analyses.

Circling back to the NFL and NBA, he cautioned, as he often does, that all negotiations are self-contained. But then he made a remark that was mostly lost in the shuffle but might have been the most significant of the weekend.

"From my own standpoint," he said, "obviously I hope we don't go down that road, because we saw what happened in the other sports."

The NFL and NBA had lockouts.

NHL players gave up a lot in the war of 2004-05, including the cap system and a 24-percent salary rollback. The players used to receive as much as 76 percent of revenues, according to the highest estimate.

"I can tell you that I don't think it's a matter of conjecture that the players made significant concessions in the last agreement," Fehr said. "It was an enormous amount of money in terms of the wealth transfer over the period of the agreement."

The players likely will argue that the problem is not their slice of the pie but how the owners generate and share their revenue. The salary cap and salary floor are tied to league-wide revenue, which has grown from $2.1 billion to $3 billion over the course of this CBA, but revenues vary dramatically from team to team. This season's salary floor is $48.3 million – $9.3 million above the original cap – causing problems for low-revenue teams.

Most of the NHL's revenue is generated locally, even more than baseball's, and so the union might want a revenue-sharing system that is even more sophisticated and detailed than baseball's.

The ideal balance would be to take just enough from the rich teams to support the poor teams, but not so much as to discourage investment on either end of the spectrum. Everyone should have the incentive to try to spend, to win and to increase revenue. No one should maneuver for the most revenue sharing.

To devise such a system, the NHLPA would need an intimate knowledge of the finances of each team in the league. Fehr said the union has overall revenue numbers for almost all of the teams, as well as player cost numbers. But he said the union still lacked "significant information," and he pointed out that profit and loss depend on the full picture.

Remember, the definition of hockey-related revenue (HRR) is negotiable. Previous union leadership settled on it with the league during the last labor negotiation. The current union leadership just jousted with the league over what should be considered as HRR under the current CBA, getting about $40 million more counted over two years.

The fight isn't just over the pie or slices of it, but over the ingredients. Right now, the union is still examining the shelves. We've got a long way to go before the sides start baking and slicing. That's why no one will say much of anything at this point. Fehr even declined to comment when asked directly if the salary cap will be in play.

"I'm not going to get into the economic systems, whether it's the player compensation system or revenue sharing or the mix between the two or anything like that at this point," Fehr said. "It's premature to do that."

FIRST PERIOD

Another potential issue: the supplemental discipline process. The players are discussing it internally, and NHL senior vice-president of player safety Brendan Shanahan said he thinks it's "something they're going to discuss in collective bargaining."

Each disciplinary hearing involves the league, the player, the player's general manager, the player's agent and a representative from the union – who looks out for the player's rights under the CBA. But in the end, Shanahan is judge, jury and executioner.

"Whenever you have a system in which somebody can say, 'I conclude, more or less as a prosecutor, that there's a violation of the agreement and you have X penalty,' and the penalty is substantial, and you don't have anything which resembles what anybody in the U.S. or Canada would call due process, you have philosophical issues which are raised," Fehr said.

Asked if there is a practical way to have due process – such as a panel – Fehr said: "Oh, sure. There are a lot of different things that you could do to modify the system, but that's not a subject I want to get into today."

The current system isn't perfect. Shanahan isn't perfect. "Imperfection?" Shanahan said, smiling. "I admit it, yeah." But it would be a challenge to find something or someone better, at least on the front end.

People often talk about a panel including some combination of union officials, league officials and independent voices. But Shanahan works closely on the big picture with Mathieu Schneider, a former NHL teammate who is now Fehr's special assistant at the union. He works on individual cases with a de facto panel that includes former NHL players Rob Blake and Stephane Quintal. And good luck finding a truly independent person with the intimate knowledge needed to do the job well. You almost certainly would end up with someone who has strong connections to the NHL.

"I take in a lot of information and observation from players who recently played the game – all-star players, players that played the game a variety of different styles, former PA members still part of the players' alumni," Shanahan said. "I don't sit in a room by myself and sort of make it up."

Adding another layer of bureaucracy could be difficult considering the logistics.

"In real time, you have to act swiftly," Shanahan said. "Sometimes you can sleep on something and wait until the morning to make a call because the team's not playing for a couple days, and other times, they're about to get on a plane and travel to the city where they're going to play the next day and their minor-league team might be a thousand miles away, and you have to act quickly."

Finally, would any system be any less controversial? No matter how suspensions or fines are levied, someone is going to be unhappy. There will always be disagreements and different viewpoints. At least now the league is much more transparent, showing videos of each incident with Shanahan stating his case.

The union's best argument might concern the appeals process. All appeals currently go to NHL commissioner Gary Bettman, which means there is no meaningful appeals process. Bettman is highly unlikely to overturn a decision by the person he hand-picked for the job.

SECOND PERIOD

I don't blame the Columbus Blue Jackets for being furious, and I don't downplay the impact of Wednesday night's game.

The Los Angeles Kings won, 3-2, when Drew Doughty scored with four-tenths of a second remaining – after the clock was frozen at 1.8 seconds for a brief moment. It looked fishy. It seemed to give the Kings a point they might not have earned otherwise. That affects everyone in the ultra-tight Western Conference, and it could have ripple effects into the playoffs considering seeding and home-ice advantage.

"It is an amazing coincidence that with the Kings on a power play at STAPLES Center and with a mad scramble around our net in the dying seconds of the third period of a 2-2 hockey game that the clock stopped for at least one full second," Columbus general manager Scott Howson wrote in a blog on the Blue Jackets' website. "I can only think of two ways in which this would have happened. Either there was a deliberate stopping of the clock or the clock malfunctioned."

It was amazing.

And so was Kings general manager Dean Lombardi's explanation.

"Those clocks are sophisticated instruments that calculate time by measuring electrical charges called coulombs," Lombardi wrote in an email to ESPN and the Los Angeles Times.

(Coulombs? Columbus? How ironic. Jackets fans must love that.)

Anyway, Lombardi's email continued: "Given the rapidity and volume of electrons that move through the measuring device, the calibrator must adjust at certain points, which was the delay you see. The delay is just recalibrating for the clock moving too quickly during the 10 tenths of a second before the delay. This insures that the actual playing time during a period is exactly 20 minutes. That is not an opinion. That is science."

I am not a scientist, and maybe I'm naive, but I buy it.

I can't tell you how often I have looked at a clock in an athletic arena and watched tenths of a second count down in fits and starts. Either the digits on the clock or my eyes don't move fast enough.

This wasn't like that. It wasn't 1.8, then 1.2, then 0.8, then 0.4, or something. This was 1.8, pause, then an apparently smooth continuation. If somebody messed with the clock, then somebody messed with the integrity of the league and somebody should be fired. But I'm not big on conspiracy theories and doubt someone hit the button for just the right split-second.

Think about it. If the timekeeper stopped the clock for a second and then started it again before Doughty shot the puck, allowing the Kings to get the winning goal with only fourth-tenths of a second to spare, that would be an amazing coincidence, too.

THIRD PERIOD

Again, maybe I'm naive. But I don't think the Pittsburgh Penguins have been complete idiots when it comes to Sidney Crosby. I don't think they have been careless or reckless with his health.

We tend to look at this from Crosby's perspective. He has lost more than a year of the prime of his career; almost certainly a scoring title, a goal-scoring title and an MVP award; at least a shot at another Stanley Cup. Sometimes we look at this from the NHL's perspective. The league has been without the face of the game, its biggest marketing asset.

Related Links

But look at what the Penguins have lost. They have lost their best player for more than a year. They have been without an asset that has cost them – or at least their insurance provider – more than $9 million in real salary over that time span. They had a lesser chance at a deep playoff run last year, not to mention a lesser chance at a championship. And the longer this drags on, the more complicated it becomes to sign Crosby to a contract extension. His deal expires after next season.

The Penguins' chairman, Mario Lemieux, had health problems throughout his career. Their general manager, Ray Shero, has a son who has been through a concussion. Their assistant GM, Jason Botterill, had to retire from hockey because of concussions.

Be it from a competitive, business or personal standpoint, the Penguins have no reason to want anything but the absolute best for Crosby, and I can only assume that they have done their absolute best for him.

Maybe Crosby shouldn't have played the third period of the 2011 Winter Classic after being hit by David Steckel at the end of the second. Maybe he shouldn't have played five days later against the Tampa Bay Lightning when he was bumped from behind by Victor Hedman. But concussion symptoms don't always show up immediately, and Shero has said he saw Crosby in the late afternoon on the day of the Tampa game and didn't notice anything wrong.

Maybe the Penguins' doctors should have diagnosed Crosby's neck injury long ago. Crosby complained of only a neck problem after the Winter Classic. But he had to have gone through a battery of tests, at least after the Tampa game. He saw multiple specialists in the months afterward, some of his own choosing. And as far as we know, no one caught the neck injury. In the end, doctors had to come together on a conference call this week to reach a consensus.

This situation speaks more to the inexact science of diagnosing these neurological problems than it does to the Penguins' handling of their superstar. They have been patient. They have been supportive. And at this point, that's call they can be.

POWER RANKINGS

TOP 6

Detroit1. Detroit Red Wings: One of the best matchups in the league is Thursday night, when the Wings visit the Vancouver Canucks. If you live in the East, stay up and watch. Lots of skill. Lots of smarts. Lots on the line with the West so competitive.

New York Rangers2. New York Rangers: The Rangers haven't scored more than three goals in 13 straight games. Either than means they are built to win in the playoffs – with great shot-blocking defense in front of stellar goaltending – or they need an offensive boost.

Boston3. Boston Bruins: Trade Tim Thomas? Because he didn't go to the White House? Seriously? Some people apparently forgot he won the Vezina and the Conn Smythe last season – and is still on top of his game.

St. Louis4. St. Louis Blues: The Blues still aren't off break yet. They don't come back until Friday night against Los Angeles. They can't afford any rust in the insane Central Division – three points behind league-leading Detroit, one point behind Nashville, tied with Chicago – but they have two games in hand on all three rivals.

Vancouver 5. Vancouver Canucks: The Canucks should not trade backup goaltender Cory Schneider unless they receive a significant return. He is too valuable. The Canucks need to know they have another option in the playoffs, whether Roberto Luongo actually falters or not.

Philadelphia6. Philadelphia Flyers: Hmm. The Predators are in Philadelphia on Thursday night. Which means Ryan Suter will see the Philly media. Wonder if he realizes how good he has had it in Nashville, especially after experience in Ottawa on all-star media day.

BOTTOM 6

Anaheim25. Anaheim Ducks: Corey Perry isn't going to carry the Ducks into the playoffs again, the way he did last season to win the Hart Trophy as the league's most valuable player. The Ducks have dug too deep of a hole. But it would be nice if he heated up a little and made the Hart seem like less of a fluke. He has no points in his past four games.

Buffalo26. Buffalo Sabres: Team president Ted Black has said the Sabres are willing to trade players who are considered part of the core. But when the core is rotten, how attractive is that, really, to other teams? Can a contender count on a guy someone else couldn't count on? (See Columbus.)

Montreal27. Montreal Canadiens: Lost in this miserable season has been an uptick in production from Max Pacioretty, who suffered a scary injury last season when Bruins captain Zdeno Chara ran him into a stanchion. The Habs winger has bounced back with a career-high 18 goals, including six in his past seven games.

Carolina28. Carolina Hurricanes: GM Jim Rutherford usually doesn't do in-season deals. But he was wise to sign defenseman Tim Gleason to a four-year, $16 million extension. Had he traded him as a pending unrestricted free agent, where was he going to find a replacement for that price in the off-season? Now he needs to move on UFA Tuomo Ruutu. Deal him before other teams fall out of the race, other rentals hit the market and the price falls.

Edmonton29. Edmonton Oilers: Is Ales Hemsky really that attractive as a rental? He has four goals. He is minus-9. He's a perimeter player who is often injured, not exactly the kind of gritty, go-to-the-net guy who thrives in the playoffs.

Columbus30. Columbus Blue Jackets: Would you want Jeff Carter – whom the Flyers shipped out, who didn't embrace the Jackets, who is signed through 2021-22 at a cap hit of $5.3 million, who has a no-trade clause that kicks in next season? He had a foot injury, and then a shoulder injury. He has 10 goals in 30 games. He is minus-9.

PLUS/MINUS

PLUS: The All-Star Game was everything it was supposed to be. A fun weekend. A love-in for Daniel Alfredsson. A chance for the NHL to recognize players, schmooze with corporate sponsors and rake in more revenue.

MINUS: So why do we have to moan and groan every year that the All-Star Game isn't an actual game? We know it's not a game. We know that going in. Take it for what it is and has been for a long time – a half-speed, no-defense exhibition.

PLUS: For all the talk about the Predators needing to bolster their lineup for a playoff run, they aren't that bad offensively. They're ranked 11th at 2.78 goals per game. They're short on stars up front but spread out their scoring. They have nine players who have scored 10 to 15 goals.

MINUS: Predators GM David Poile has no choice but to keep Suter and do something before the Feb. 27 trade deadline, though. Not only does he have to convince the pending unrestricted free agent that Nashville has the resources, the will and the ability to go for it, he has to convince Suter's defense partner, Shea Weber, who can be an unrestricted free agent after next season.

PLUS: Gordie Howe is showing signs of dementia at age 83. As someone who has interviewed him as recently as this fall, I can tell you he does struggle with some things. But he still has his trademark Mr. Hockey charm and wit. At least on his good days, he can still smile, joke and fire off one-liners.

MINUS: The Crosby counter is at 23 games.

@COTSONIKA TWEET

“Thomas with two sweet saves. A great effort he had to make as an INDIVIDUAL.”

Trying to confirm Tim Thomas released this statement after winning his fourth straight All-Star Game:

"I believe the League's showcase has grown out of control, threatening the Speed, Intensity and Integrity of the Game.

"This is being done in the Offensive, Neutral and Defensive zones. This is in direct opposition to Defense and Don Cherry's vision for the National Hockey League.

"Because I believe this, today I exercised my right as a Free Goaltender, and did not lollygag in the All-Star Game. This was not about Team Alfredsson or Team Chara, as in my opinion both teams were responsible for the situation we were in as a sport. This was about a choice I had to make as an INDIVIDUAL.

"This is the only public statement I will be making on this topic. TT"

Thomas was unavailable for comment.

More Stories

2014 NHL Team-by-Team Draft Selections

1 (10) Nick Ritchie, LW, Peterborough (OHL). 2 (38) Marcus Pettersson, D, Skelleftea Jr....

Record revenues lead to another increase in NHL salary cap for 2014-15 season

NEW YORK, N.Y. - After a year of record revenues, the NHL salary cap is going up again. The...

With NHL revenues tied closely to Canadian dollar, Bettman keeps eye on it

PEBBLE BEACH, Calif. - Gary Bettman knows the value of the Canadian dollar affects the NHL a...

Next year's salary cap projects to be roughly US$71 million as NHL revenues rise

PEBBLE BEACH, Calif. - A year ago things weren't so great for the NHL. The lockout was becoming...
blog comments powered by Disqus

THN on Twitter

If the NHL expanded into one market, where should it go?








Contests

Our Partners