The Lockout Thread UPD 1/6 - framework of new CBA agreed to
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12-07-2012, 04:33 PM
Join Date: Feb 2005
Location: San Jose
Originally Posted by
By the same token though, the owners said something along the lines of "the 50/50 split is the biggest thing we need for the survival of hockey" yet the 5 year contracts is the "hill they will die on". They have been just as disingenuous. It's all a PR campaign, both sides. Why is the contract length so important to the owners? Is it really worth losing a whole season over? If its such an issue, they didn't have to give out the long term contracts. Sharks management managed not to cave. I'm pretty sick of the whole process. Both sides have lied and postured, it's just frustrating not having hockey. I disagree one side is more to blame than another, they're equally at fault here.
Yes, contract terms were in their initial request. They have been consistent about including it as critical. It is the press that has discounted the importance. There are a couple of reasons for the importance of the terms. The biggest reason is insurance. I did a rough calc where they are losing about $100mil in insurance for the big contracts. That is money that is lost to both owners and players. Over a ten year CBA, you are talking $1bil. That is a lot. And the insurability term of contracts has been reduced over the last couple of years from a 7 year term to a 5 year term. Premiums are going up and are astronomical for contracts beyond the 5 year limit (actuarial tables caught up to the real payouts).
The second reason is bring compensation in line with the face value of contracts. With the stink the players made about Make Whole, this is part of the response. "Fool me once, shame on you; fool me twice . . . " The contract term issues are part of the initiative from the league aimed at reducing the need for escrow.
Finally, the term of the CBA is of monetary value. The players asking for 5 years was ridiculous as the league is competing for sponsorship dollars. Part of their pitch to sponsors is the potential for labor peace once the deal is done. They are already getting heat from sponsors. A reductions in sponsor dollars under the terms of the rest of the agreement will directly hurt the players as they will still be using HRR to determine player pay.
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