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THN Ken Campbell: Guaranteed contracts should be abolished

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05-25-2008, 07:08 PM
  #1
Buffaloed
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THN Ken Campbell: Guaranteed contracts should be abolished

http://www.thehockeynews.com/article...abolished.html
Quote:
Itís all well and good for Anaheim Ducks GM Brian Burke to tell Scott Niedermayer he needs to know what Niedermayerís plans are for next season by the time the draft comes in June, but the reality is Burke has absolutely no leverage in this situation.
He discusses the Niedermayer situation and has no doubt the league will try to address guaranteed contracts in the next CBA. I'm sure the NHLPA will be very receptive to that idea. I don't think they'll ever be able to abolish them. They may be able to limit the term that can be guaranteed (eg 5 years) or insert clauses that allow teams to void a contract (eg suspensions). They should also have injury-related buyouts similar to the NFL's.

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05-25-2008, 10:25 PM
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thinkwild
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Quote:
Originally Posted by Ken Campbell
It’s another classic example of how the players, who were supposedly clobbered in the last round of CBA negotiations, continue to hold an inordinate amount of power. After holding a team to a commitment by signing a contract, the player then decides if and when he wants to come back.

And there is no repercussion for the player aside from not being paid while suspended. The team cannot force a player to file retirement papers or do anything to get him back in the lineup until the player is good and ready.

[..]
When it comes down to it, Niedermayer’s actions this season are no different than those of players of the past who held out on valid contracts in order to force a renegotiation. The motivation was different, but the act was the same.

Well, that isn’t allowed in the NHL anymore and it’s time the league did something about the Niedermayer-type end-around in the future.
Seems a lame attempt at trying to find a reason to abolish guaranteed contracts.

An inordinate amount of power? Give me a break. How is this even new? Niedermayer could’ve done this under the old cba too, but now that the cap system(’s unintended consequences?) benefits the team from players doing so, they want to punish guaranteed contracts? Totally missing the point perhaps?


It’s a curious angle he comes at this from, suggesting that abolishing guaranteed contracts is needed to prevent players like Niedermayer from kicking up his heels for half a year. Presumably in an ideal world, they could throw the players in jail for attempting such a thing. (as long as there was no cap compliance issues with it of course).

I thought the main angle everyone was taking on this issue when it happened, was the unfairness the Ducks got in getting around the cap by this loophole. That the true outrage was the unfair cap advantage that the team got from Niedermayers action, and without some action by the league, other teams may exploit this loophole to their advantage.

Many thought Burke may have even concocted the scheme and got Niedermayer to go along with it as a way for the team to gain an advantage over other suckers abiding by the cap.

In other words, the problem had absolutely nothing to do with players having guaranteed contracts, but GM’s use of them to exploit the cap. Meaning abolishing the guaranteed contracts would do nothing to solve this problem? Kens piece is a logic fallacy?

The non guaranteed contracts could be good for players though. Niedermayer, if he was on a team where he didn’t like the coach or the teams future, he could just quit mid-season and go play for his brothers team?

What I would want my team to do would be to outbid all other teams for free agents, offer them all 50 year contracts, whatever it takes to win the bidding war. After all, who cares, it doesn’t really count for anything.


Wouldn’t getting rid of guaranteed contracts: reduce the amount of trades, lessen trade values. and increase player movement even more? No consequences for teams making big spending mistakes? Wasn’t there a desire to punish them if they tried to buy their way to success? It is not just players that benefit from guaranteed contracts.

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05-25-2008, 10:49 PM
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At the bare minimum, I'd love to see a system where if a player under-performs 90% of his peers who make similar money, a team has the option to either a) cut the player or b) reduce the player's salary to half (if the player has one year left on his contract).

By that same token, players would want more money if they out-performed their contracts. Thus, if a player over-performs 90% of his similarly-paid peers, the player has the option to end his contract and become a special class of free agent whose rights belong to his team for one month, after which they become a UFA.

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05-25-2008, 11:36 PM
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thinkwild
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Quote:
Originally Posted by Mr Bugg
At the bare minimum, I'd love to see a system where if a player under-performs 90% of his peers who make similar money, a team has the option to either a) cut the player or b) reduce the player's salary to half
And why is that such a commonly stated wish? I guess it goes hand in hand with the seductive simplicity of the salary caps utopian perfection, 30 equal teams, every player gets paid exactly as his production warranted, not a penny more, not a penny less.

But isnt that silly that its such an infatuation with fans? Part of the whole game is GM’s paid big bucks to take the risks and sign the big contracts. To make the decisions that they are hired and fired on. Some players they get a good deal on and they are praised as good GM’s for. Some players they overpay for, and they and that player quickly become enemies of state.

But it is that very guess, the successes and failures that are part of the GM’s game, what makes a good builder.

This production based escrow idea, seems an attempt at childish idealism for no apparent systemic benefit, nay a misunderstanding of the best for the systems benefit. Or just a desire to ensure the owners properly pay salaries in the end, regardless what their GM's paid for them at the time? Allow them to pay GM's minimum wage

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05-26-2008, 12:21 AM
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Quote:
Originally Posted by thinkwild View Post
The non guaranteed contracts could be good for players though. Niedermayer, if he was on a team where he didnít like the coach or the teams future, he could just quit mid-season and go play for his brothers team?
Uhh no. With non-guaranteed contracts (at least by the NFL model) it is the team, NOT the player, who decides when to terminate the contract (and then, only during a specified window in the offseason). The players CANNOT breach the contract by quitting "mid-season and go play for his brothers team" and the team CANNOT arbitrarily terminate the contract mid season.

There is NO way in hell the NHLPA ever agrees to non guaranteed contracts. And in the very unlikely chance that they do, I can guarantee it will be in conjunction with the removal of limits on signing bonuses. In effect, it will become just like the NFL. Instead of Brian Campbell signing for 5 yrs/$30M ($6M/yr), he will demand (and get) 5 yrs/$5M ($1M/yr) with a $25M up front guaranteed signing bonus.

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05-26-2008, 12:39 AM
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thinkwild
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Quote:
Originally Posted by kdb209 View Post
Uhh no. With non-guaranteed contracts (at least by the NFL model) it is the team, NOT the player, who decides when to terminate the contract (and then, only during a specified window in the offseason).
I suppose that makes it easy to see why relative to that, Ken Campbell would perceive Niedermayers actions as an inordinate amount of power.


Quote:
Originally Posted by kdb209 View Post
There is NO way in hell the NHLPA ever agrees to non guaranteed contracts. And in the very unlikely chance that they do, I can guarantee it will be in conjunction with the removal of limits on signing bonuses. In effect, it will become just like the NFL. Instead of Brian Campbell signing for 5 yrs/$30M ($6M/yr), he will demand (and get) 5 yrs/$5M ($1M/yr) with a $25M up front guaranteed signing bonus.
I wonder if as fans, we'd prefer it this way. Its almost hard to believe that the idealistic majority such as preferring adjusting players salaries each summer to account for production, would prefer this system to guaranteed contracts once they thought it through.

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05-26-2008, 01:59 AM
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It's an interesting theory, but the NHLPA after agreeing to a cap isn't going to make such a big concession in the next CBA. The best the NHL can hope for is a cap on the number of years on a contract (like the NBA) and some changes to how this works. Maybe a player who does something like Neidermayer has his contract immediately voided but remains property of the team until the term of the original contract expires.

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05-26-2008, 10:56 AM
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I don't see any great way that would allow a team to proactively deal with a situation like Neids. At best the team still would miss the main UFA signing period.

I wouldn't mind seeing some early deadline date for an absent w/o permission or defected player to rejoin a team. Say October 15th or such, after which the player is not eligible to play in the NHL that season.

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05-26-2008, 04:03 PM
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What bothers me about the article is that it presents one side of an argument. It also suggests a single wide ranging remedy for an issue that has only occurred once.

Why doesn't the article go into the background of guaranteed contracts? Why are they there? I can think of several reasons.

Players give up the time of their lives which would be used to climb the ladder of the workplace. It is lucrative and assumes that they will have a short career that obviates the need for better compensation later in life. That is the trade-off. The guaranteed contract is a way of insuring that some obstacles to financial security won't be put in the way of the financial goals of the player.

Some players are not at the top of their profession and it protects them from issues where a change in management/coaching doesn't arbitrarily decide that another cheaper player could fulfill the role on the team for lesser $. Or, that a single player won't be penalized if there is a coaching change where the new coach is not as enamored of the player as the previous coach. It is an incentive to management to treat each player with respect.

It protects players who put their long-term health at risk and can suffer degenerative health issues. This can range from anything like concussion issues to degenerative knee, hip, shoulder and back issues. It provides them with a financial cushion.

Another part of the guarantee is that it provides the player with a stronger legal recourse if a team should go bankrupt.

I am sure others here could provide other reasons why guaranteed contracts were high on the players agenda when they were instituted.

When looking at this specific situation, why didn't the author look to suggest a specific remedy more appropriate to the issue? Why not suggest a mandatory one-year suspension (cap hit included) if the player could not show one of a very specific list of causes for absence from training camp. Beyond that, the CBA gives Bettman the right to investigate anything that looks like a circumvention of the cap. Spelling out this kind of situation for the next CBA is all that is required, not a broadranging remedy.

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05-26-2008, 04:06 PM
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First off, I don't think non guaranteed contracts will ever see the light of day.

Secondly, I don't think they're what's best for hockey from an economics point of view ..... the non guaranteed contract in the NFL is a unique entity (blah 1st round picks being highest paid players in the league, 3-4 year average career length, roster bonus tricks, etc, etc).

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05-26-2008, 04:47 PM
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thinkwild
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Quote:
Originally Posted by SJeasy View Post
I am sure others here could provide other reasons why guaranteed contracts were high on the players agenda when they were instituted.
I agree with you overall. But it's Contracts. The players wanted contracts. Isnít even the very suggestion of ďguaranteedĒ contracts somewhat redundant? Isnít that the point of a contract - that you live up to it? Do we even need to call them guaranteed, isnít that implied by the word - contract?

Its not that players are fighting for some abnormal luxury of guaranteeing their contracts. It is owners who want the abnormal situation of non-guaranteed contracts. To sign players to contracts that they donít have to honour.

If the Rangers outbid us for a UFA, by offering him a 6 year deal to our 3 year deal, and then after 2 years they decide, nah, we made a mistake, and let him go for no cap consequences, that is fair to us? How do we benefit from such a cavalier attitude towards contracts? No living with the consequences of outbidding us for players? No consequences for the trade-offs made?

Although I can see amongst the more rabid owner supporters, that there is a certain glee involved in the idea of non-guaranteed contracts as making sure no player ever gets a penny more than he may be due. But only seeing through that prism may miss the big picture.

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05-26-2008, 05:52 PM
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A non-guaranteed contract system would simply result in changes to the signing bonus system. It'd be like current NFL system.

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05-26-2008, 06:08 PM
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thinkwild
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It sounds to me at first blush, that the simple result of changes to the signing bonus system, would likely lead to a further advantage to large market teams over small, as the rich teams could put all that cash up front for a huge signing bonus a lot easier than small markets could. Unlike the NFL where their entire salary budget is paid by the national tv contract and revenue sharing before a game is even played, the same simple result may not lead to the same egalitarian model in the NHL as the NFL.

Is that simple result consistent with the values so fought for to get a salary cap?

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05-26-2008, 06:10 PM
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Quote:
Originally Posted by Mr Bugg View Post
At the bare minimum, I'd love to see a system where if a player under-performs 90% of his peers who make similar money, a team has the option to either a) cut the player or b) reduce the player's salary to half (if the player has one year left on his contract).
Define "underperforms".

Did Chris Draper under-perform numerous other third-line centers this season by virtue of only putting up 9 goals?

This mindset gets us down the slippery slope whereby fantasy league standards alone (read: individual offensive numbers) are substituted for what constitutes a superb hockey player who contributes to his team in all areas of the ice.

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05-26-2008, 06:24 PM
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Maybe injury-related buyouts would work out, but what concession will the NHLPA have to make? If they're supposed to give up guaranteed contracts, they're going to want major changes to the salary cap system. What's more important to the owners?

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05-26-2008, 10:49 PM
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Quote:
Originally Posted by Buffaloed View Post
http://www.thehockeynews.com/article...abolished.html


He discusses the Niedermayer situation and has no doubt the league will try to address guaranteed contracts in the next CBA. I'm sure the NHLPA will be very receptive to that idea. I don't think they'll ever be able to abolish them. They may be able to limit the term that can be guaranteed (eg 5 years) or insert clauses that allow teams to void a contract (eg suspensions). They should also have injury-related buyouts similar to the NFL's.
Seems to me that the much discussed "cost certainty" must cut both ways. NHL owners get the certainty that they receive a fixed cut of the revenue pie and NHL players get the certainty that if they sacrifice their bodies and get injured they will still be paid.

I'd say there is no chance that guaranteed contracts will end, but I can see the next CBA putting a maximum limit on the number of years in a contract extension.

re: Niedermayer--they did suspend him for not reporting--there is a mechanism for handling this--they could tighten up this process.

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