League Rejects PA’s Counter-Offers.

A day which began with cautious optimism has ended once again in disappointment, as the NHL rejected the NHLPA’s latest offers, stoking fears of another lost season.

NHL Commissioner Gary Bettman emerged from today’s meeting with the NHLPA (which barely lasted an hour) to express disappointment in the players’ offers, claiming the two sides weren’t speaking the same language,calling the PA’s offers a step backward in the process.

Bettman claimed the PA’s proposals were merely variations of their initial one this summer regarding the players share of revenue.

Fehr subsequently spoke to the media, where he gave brief descriptions of the PA’s three offers. As per Tweets from James Mirtle:

No. 1: Would have fixed share in first three years. Share then frozen until hits 50% (Year 3 to 5). 

No. 2: Players will get 25% of any growth. Their share would hit 51% by Year 4 and 50% by Year 5 with 5% growth. 

No. 3: “We’ll move to 50-50 as long as you honour contracts.” Players get 13% up front to cover those contracts. 

The NHLPA isn’t expected to make copies of their proposals available for public scrutiny as the NHL did with their latest proposal earlier this week.

Fehr also said the proposals dealt solely with hockey-related revenue (HRR) and core economics. There was no discussion on other issues (revenue sharing, contract term, arbitration, entry-level contracts, eligibility for UFA status, etc).

He did, however, say the players had concerns over the secondary issues, claiming the things the players got from the last round of concessions, the owners now wanted to take away. He didn’t specify what those concessions were.

It’s easy to see what led to the breakdown in talks today. The NHL wants a 50-50 split immediately. The PA, on the other hand, would prefer either a gradual reduction to minimize the escrow hit for the players, or an immediate 50-50 split if the league honors all existing contracts.

Hopefully, there will be more details upon what the players were offering. I’ll add them to this post if they are made public.

So, where do they go from here?

Well, it’s obvious there won’t be any further negotiations between the two sides this week. Bettman and company flew back to New York in an apparent huff, leaving the PA to stew in their Toronto headquarters.

It’s possible the reactions today are merely public posturing, with “off-line” discussions among the lieutenants from both sides over the weekend.

Then again, the frustration from both sides could be very real, in which case, things could be getting worse instead of better.

The NHL could send a clear signal as to its intentions if it announces cancellation of the next block of games (possibly a month’s worth) between October 19 and 24. Bettman has already made a subtle hint cancellation of future league events, including the Winter Classic, becomes a real possibility in the near future.

Don’t expect another proposal from the league. Bettman and company will now hope the threat of cancellation of more games and potential loss of the Winter Classic could put more pressure upon the PA to offer a more suitable proposal.

The important, positive note to take away from all this is the NHLPA and NHL, despite their rhetoric today, are on the same page regarding division of HRR. Both have agreed to 50-50 split. The question now is how they get there.

The next few days could tell the tale.

21 Comments

  1. I don’t mind that the NHL players are demanding that the NHL honor all existing contracts. I will mind very much if they wimp out in a month. They have to see this through, whether that means decertification or sitting out a year and a half. The NBC TV contract and the Winter Classic are pressure points for the league. For the players, those are just one game out of 82. So if the league is concerned about their sponsors, they’ll moderate their stance and respect the players demand that they honour the contracts they signed.

    • Yo Thomas,
      You might think differenty if it were your money being forfeited, your career going down the drain, and your family’s well-being on the line.
      I saw somewhere that, after the last lockout, close to 200 NHL players never played another game in the League.

      Me, even though I think the NHLPA is being totally unrealistic about where this is going to end up, even though I think the players have no philosophical leg to stand on, I totally support their right to make their own decisions, and respect that.

      So if they decide to sit now and forfeit money they will never see again over their short careers – I’m good with that.
      And if they decide in a month to “wimp out”, well, I’m good with that too.

      Easy too be hard-nosed in theory and when someone else is taking the hit.
      Politics is “the art of the possible”, and growing up means making compromises.
      And you want them to sit out a year and a half?
      Pretty brave talk, do you have kids?

      As the twerp, Bettman, said at the beginning of all this, the players should not be feeling any sense of entitilement about their right to 57%.
      Says who?

  2. Hmmmm…

  3. Bring on the SCABS

  4. I’m confuse a little bit.

    What is the difference between a 50-50 split with no-rollback that the NHL proposed and the 50-50 split while honouring contracts that the NHLPA proposed?

    • A 50-50 split with no rollback means that the players pay into Escrow, and they only get back what would bring them up to 50% of the revenue for the year. So maybe pay 20% of their salary goes into escrow, and they get 40% or so of the escrow back at the end of the year.

      A 50-50 split while honoring existing contracts would mean, on those existing contracts, the cap hit, escrow, etc would be based on 87%. So nearly all of the escrow payment would come back to the player. The owners would technically be getting less than 50% of the revenues until 2026 when Weber’s contract expires. But it would converge to near 50% within 5 years or so when the number of contracts from the old CBA is much lower.

    • If you are the same business genius Mario hating Mike I am shocked you don’t know the difference(actually I’m not at all shocked as this comment clearly shows you were lying about your credentials in the first place).

      If this is a different Mike, I apologize for the comment as a conversation with a particular business genius Mike resulted in my asking him a basic business 101 question he did everything possible to try and convince me he could answer but refused to because he was much too smart to answer questions like that even though that’s what he did for a living – allegedly – unlike normal people whom if they don’t know how something works and are interested actually seek the answer instead of pretending to know everything for the sake of bolstering a viewpoint.

      But I digress, so here is my today’s two cents on this bargaining situation; both sides have failed in their PR attempts to garner much sympathy from the fans for either side in this dispute. I think they’ve just made themselves look like an entire group of greedy people fighting over amounts of money most of us dream of having. While I do not dispute that both sides want what they consider fair, with the types of arguments back and forth involving ‘millions of dollars, billions of dollars,’ all we as fans here after that is ‘blah, blah, blah, I want more! No! I want more!’ Both sides have failed miserably in trying to make us feel bad for them and now we don’t care what the particulars are, we just want them to hurry up and divy out those cajillions of dollars and get back to what makes them this money in the first place and play some friggin’ hockey!

  5. has come down to splitting hairs.sad sad day for hockey FANS!!!!

  6. Now I have no sympathy for the players, now it just look like they don’t want a season.
    @rattus
    Really think the players have a problem paying for food to their kids in a year? The poorest NHL player probably has more money on a savingsaccount then you and I make in 5 yrs of work. They will be fine.

    • Do you think the owners are in the soup kitchen line? Both groups in these negotiations are GREEDY.

      I don’t think either side is negotiating either. Just back and forth, offer and rejection. Where is the tweaking and counter offer? I do support the notion that salaries should not be rolled back. If the league didn’t want to pay the salaries, why did they offer them to the ufa’s this past summer? It was getting obscene the amount of money being thrown around.

      I am guessing the hrr split will end up around 50/50, but that is still a big concession on the part of the players if it happens. Will the owners be giving up anything? And to the notion that the old cba has expired so players should get the 57% figure out of their mind is a joke. With that logic, the old cba has expired and it is a clean slate for negotiations, out with the old, does this mean the salary cap has to be renegotiatied if the league wants to keep it… are they starting from scratch with an all new cba with a nice cover with sunshine and rainbows? Raffi, get your crayons out, you get to color the cover of the new contract. Hey Raffi, stop eating the crayons, you can afford to eat now. They are all greedy buggers.

    • Tis true, or at least in my case.

      But probably not as much as you think, and also people do lose money, like on investments and with crooks – viz Modano, Heatley et al.

      And consider the length of their careers and what they are eduacated for afterward – which is basically nothing for the most part.

      That savings account has to go a long way int the future.

      I do have 2 boys, now mid-teens.
      It’s an expensive proposition.

  7. I look forward to the day that the players start up their own league, formed as a co-op. They could start with 10 teams (Quebec, Montreal, NY, Toronto, Chicago, Winnipeg, Edmonton, Calgary, Vancouver, Minnesota), and establish salaries as a % of revenue, as opposed to a $ amount. They could play for the Bettman cup every year.

  8. Don Fehr’s what I call a rooster. They are people how crow the loudest to get opinion favouring them but don’t actually propose anything intellectual. Rather, their stubbornness causes others to waiver until they stop crowing. If I were the NHL, I’d just stop dealing with him, because he’s making about as much sense as Mitt Romney’s economic proposals… the math doesn’t add up for the owners.

    I also hate the “blame the owners” mentality on the front of paying the contracts in the first place, and the Drew Doughty situation from last year proves my point: either you pay him more than he’s worth (despite winning a cup this year) and win the cup or you don’t pay him, don’t generate revenues, and have your team probably miss the playoffs entirely (the kings were on the bubble and without Doughty would probably not have made it). GMs are trapped into having their fans buy tickets to fill their seats and giving them a competitive product, which means they’re forced to overspend in order to generate enough hope for a fan to want to swipe his credit card and send part of his soul into a team. Would you pay 100 bucks to see a Penguins game if you don’t see Sidney Crosby or Evgeni Malkin? If a team lets its star players sit, they’ll have plenty of places to sit in the crowd. And otherwise, to stop it would mean collusion between them. I don’t blame anything but the system and now the owners want to change the system, and they’re the ones getting blamed.

    Right now, they’re trapped. The system doesn’t work and the PA’s not cooperating on fixing it without teams losing money still promised to lose money for the next two or three years.

    • I hear what you are saying MJR, but still don’t understand really all of the logic.

      Players took a big cut in salary during the last negotiations and settled on 57% share of hrr. besides the owners offering players 43% and then 50% of hrr and some changes to contract rules, what concessions are the owners offering? If a player doesn’t want to sign for what you are offering, trade him. There is a cap, live by it. Talk about Romney, sounds like he is bettman. He wants to protect the big money making teams and is using the money losing teams as the excuse to go after more money. If the hrr is over 3 billion, why are the owners going after the players share when if they just shared their own portion better, took care of the smaller market teams, we wouldn’t be in this mess. It is all spin. on both sides. all greed.

      • Actually, in 2004 the players got 54% and it has since risen to 57% (Nick Kypreos (Union guy) and Bill Daley agreeing to that.

        What business gives 57% of REVENUES to it’s employees off the top?

        Imagine if you were running a business and gave 57% of renenues to your one employee.
        Then, from your 43% you paid ALL the expenses.
        Then, what was left after that was taxed.
        You’re not left with much.

        And yet all the risk to the money is your risk, not that of your employee.

        In what world does this make sense?

        • What business gives 57% of REVENUES to it’s employees off the top?

          You’re looking at it wrong. In this case the revenues are directly tied to the employees (ie. the players are the product). If you were to have the NHL with AHL players, then the owners would be getting AHL level revenues. The owners also pay coaching staff, trainers, equipment, arena leases, debt interest, etc… But at the end of the day, the NHL has problems because the salary cap structure makes teams like Phoenix, Columbus, etc… pay the players 60-70% of their revenue just to hit the floor while at the same time allowing teams like Toronto, Montreal, NY Rangers, etc… to spend to the cap at roughly 40% of their revenue.

  9. 1) I agree with Lyle here. It seems both sies are closer than we are led to believe if one were to just listen to the NHL rehtoric or read only the headlines. Unless the last NHL offer was a ‘take it or leave it’ deal?
    2) I would think there has to be a bridge that could link this gap. Sounds like the players are willing to concede significant dollars. The owners win either way. Its not like they will be paying a higher % no matter what is ultimately agreed upon

  10. The owners won big last time, very big. They didn’t anticipate a combination of issues, which were the fast growth of the game, along with the continuing struggle of several teams. The former led to the rapid escalation of not only the cap ceiling, but also the cap floor, and the struggling teams got hosed in the deal. Their revenue wasn’t increasing, but the league’s revenue was.

    Now Bettman and the owners want the players to support the struggling teams, when what they should do is to have the rich teams contribute more to the pot for the poorer teams. The owners’ proposal would also make more money for the rich teams, an idea to which the union rightfully objects.

    Boston Gobe columnist Kevin Paul Dupont proposed that the players be assessed a 2.5% “tax” on their contracts, and the owners be assessed a 2.5% tax on their player payroll. The proceeds from both would be applied to the struggling teams. I thought it was an excellent compromise proposal.

  11. Regarding the Kevin Dupont proposal, how about moving the Phoenix Coyotes (and three or four other franchises on life support) to markets that will generate revenues (what a concept!) and minimize or leiminate the need for revenue-sharing? Of course, that might be too business-like for the NHL. Pity.

  12. Really unhappy with, and very disappointed in the NHL.

    At the very least, option #3 from the PA is reasonable. It agrees to the 50-50 split right away as long as current contracts are honored. That is a rational point of view. These owners signed the players to contracts, under the current CBA and players signed them in the good faith and understanding that it was a contract.

    To think the owner of the Wild is sitting in a room huffing and puffing and posturing, about the absurdity of player contract when less then 6 months ago, he signed Parise and Suter to $100 mil plus deals for 10 years, is laughable. He has some nerve.

    The PA’s last option should have been the basis for continuing negotiations. It addresses and agrees with the 50-50 deal outright. The rest should have been negotiated within reason. The players gave up a ton, and then some 7 years ago. And it was right to have a cap. I am not disputing that. But this last CBA was the OWNERS baby. They got everything they wanted and more. Now they are trying to paint the players as the bad guys? It does not pass the smell test at all.

  13. @Hyedray it’s even worse than you think as Poile (the owner of the Wild) used to own the Predators and went cap in hand to the NHL crying poverty every year until he was rewarded for not selling the Predators to Balsillie by the league allowing him to buy the Wild when he finally dumped the Predators.
    the NHL needs to contract by about 4 teams to ease the financial pressure, it’ll mean less games but it’ll also mean less jobs for players. the better players on the contracted teams will be distributed throughout the league on a dispersal draft leading to a better product on the ice.
    the league also needs to put another team in Ontario and if that leads to the demise of the Sabres so be it. the NHL needs some more solid revenue teams to account for the so so franchises that don’t make money every year. the owners have put up with some of those money losers for far too long at Bettman’s behest. he had a vision of what he wanted the NHL to be and it clearly didn’t work so now it’s time to bring in someone else to clean up his mess.
    Bettman and the owners need to realize that threatening to cancel games isn’t going to do anything, all they’re doing is painting themselves into a corner. they can’t threaten to go to replacement players as that won’t sell and it might blow up in their faces if star players flood the european leagues in response. i’m sure Fehr has told the players that they might have to sit out for awhile to get a CBA they consider fair. the only players concerned about losing a season are the fringe players who know there will be more competition for jobs next year from the prospects who are getting minor pro experience this year and will be ready to move up next year. it’s not all bad news for the owners either as there will be expiring bad contracts coming off the books at the end of the year.
    i consider myself to be a pretty hardcore fan but i’m not really missing hockey and i’m not alone, that has to be a concern for both sides. at the end of the day both sides are making money from people who view their product as a luxury and they will find alternative ways to spend it,