The Business of HockeyDiscuss the financial and business aspects of the NHL. Franchise sales, valuations, TV contracts, ratings, expansion, relocation, the CBA and work stoppage discussion goes here.
NHL wants to cut salary costs, longer term CBA; NHLPA does not (CBA negotiations)
Collective bargaining is something that owners require so they can deal with the players as a group-- and I think it benefits them more than players. Blame US antitrust laws if you must find a scapegoat
Fugu, you must be far younger than me, or not a student of NHL labor. Owners way back when were more than happy to NOT deal with players as a group. To say that collective bargaining benefits the owners more than players fails to take into account the past - with short term contracts and no freedom of movement (i.e. free agency).
No, I think that collective bargaining works very well for the players in the last 30 years
I have a lot of confidence in Fehr's ability to lead and represent the players. He will give what needs to be given but I don't thinkk he will be pushed around.
I think he recognizes that if the players capitulate again, the ststem the owners have designed still won't work without some transfomative change in how it works that merely fiddling with percentages won't accomplish. If they can agree on a workable business model, I jave every cinfdence the numbers will then fall quickly into place.
It seems to me the NHL would just like to discounbt the price and forget about all else. To me that seems like incresing the line of credit without fixing the problems that will cause you to increase it again and again until it can't be increased any more.
I think Fehr is right to insist on looking at systemic issues, not just numbers.
Fugu, you must be far younger than me, or not a student of NHL labor. Owners way back when were more than happy to NOT deal with players as a group. To say that collective bargaining benefits the owners more than players fails to take into account the past - with short term contracts and no freedom of movement (i.e. free agency).
No, I think that collective bargaining works very well for the players in the last 30 years
Fugu is right that the CBA helps the owners more than the players.
It is true that before US courts struck down the MLB reserve clause, NHL owners used unfair power imbalances to abuse and underpay players. Howevern the game-changer that ended that is US anti-trust law, not the NHLPA.
Without a CBA every player would now be a free agent.
Mork, with all due respect, at this point it is about the players getting the best deal they can under a linked cap.
If they are not willing to get back to the table under the cap system (that has served them very well by the way), they will be fighting each other for spots in Russia, Europe, or wherever else.
Guys, this is not about what is right, or fair in our opinion...it is about a "club" deciding about who the members are and what privilages or fees they are going to charge / accept. I really believe folks that think there will be a model besides a linked cap are delusional - and that includes the players.
There is a linked cap that was hard fought and won, and it is not going away. For the players to keep proposing other structures is a waste of time, and in my opinion makes them equally culpable in causing the work stoppage should it come to that.
Mork, with all due respect, at this point it is about the players getting the best deal they can under a linked cap.
If they are not willing to get back to the table under the cap system (that has served them very well by the way), they will be fighting each other for spots in Russia, Europe, or wherever else.
Guys, this is not about what is right, or fair in our opinion...it is about a "club" deciding about who the members are and what privilages or fees they are going to charge / accept. I really believe folks that think there will be a model besides a linked cap are delusional - and that includes the players.
There is a linked cap that was hard fought and won, and it is not going away. For the players to keep proposing other structures is a waste of time, and in my opinion makes them equally culpable in causing the work stoppage should it come to that.
It is a waste of time. That's the point. Wasting time until the other side feels that they have to make some sort of concession that will appeal to the other. Neither side has proposed a deal that has generated even remote interest from the other side. Neither wants to be the first to blink, and that's the game.
The NHL makes a completely laughable offer, and the players respond with an equally laughable one. They make small tweaks to their offers without changing the key dealbreakers. Neither side has gotten serious, yet.
A couple of points to throw into the fire that I haven't seen mentioned (although I admit I only read these threads sporadically):
1. Comparing the NHL to NBA is as reasonable as comparing the 2012 NHL to 2005 NHL. Both should be stopped, otherwise, what's next, comparing to the MLB? The financial realities of the leagues are different, and a lot also depends on how strong the union is, what quality dropoff one would see if replacements are used etc. As far as I am concerned, the only numbers that matter is the NHL actual finances in 2012.
2. When talking about the top market teams not willing to share their revenue with poorer teams, let's keep one thing in mind. Astronomical profits of those few teams are due to the cap only. If not for the cap, introduced due to the smaller market teams, the big market teams would be sporting 120+ million payrolls. By the way, speaking of comparables, I do not know of any business that would be making 40% profit on revenue, like these few teams do. Potentially drug dealers, but I haven't seen their books
Fugu, you must be far younger than me, or not a student of NHL labor. Owners way back when were more than happy to NOT deal with players as a group. To say that collective bargaining benefits the owners more than players fails to take into account the past - with short term contracts and no freedom of movement (i.e. free agency).
No, I think that collective bargaining works very well for the players in the last 30 years
You must not be a student of professional sports labor for the past 40 years.
Absent a CBA, any actions by a a League (or even two or more teams acting in concert) which restrict the freedom of players would be a violation of US anti trust law. Things like the draft, player eligibility, and restrictions on free agency would be illegal absent a CBA. However, courts have held that they are legal if they are teh product of bona fide Collective Bargaining - the Non-Statutory Labor Exemption.
1971: Haywood v. National Basketball Association
Spencer Hayward challenges the NBA's player eligibility requirement - 4 years after high school. Hayward signed with the ABA as a 19 yo (after 1 yr of college) and then a year later signed with the NBA Seattle Seahawks. The NBA refused to accept the contract. Hayward sued, and a U.S. District Court ruled that the NBA's action was an illegal group boycott under the Sherman Antitrust Act. The NBA appealed and eventually the SCOTUS upheld the lower court ruling. The NBA's player eligibility requirements were imposed by the league and not part of the CBA.
1976: Mackey v. National Football League
John Mackey challenged the NFL's "Rozelle Rule" - effectively the NFL's Reserve Clause. The rule required that before a team could sign a player as a free agent, that team had to agree on compensation to the players previous team, or absent that compensation would be dictated by the Commissioner. John Mackey challenged the Rozelle Rule on antitrust grounds. The League argued that it should be protected under the Non Statutory Labor Exemption. The Eighth Circuit disagreed - the Rule was imposed by the NFL and not the product of Collective Bargaining - and the Rozelle Rule was struck down.
1987: Wood v. National Basketball League
Leon Wood was drafted by the 76-ers who could only offer him a minimum salary contract because they were over the NBA's salary cap. Wood sued the NBA, challenging the draft, the salary cap, and restrictions on free agency as violations of antitrust law. The Second Circuit rejected the challenge - ruling that all those restrictions were covered by the NBA's CBA and protected by the Non Statutory Labor Exemption.
2003: Clarett v. National Football League
After being dismissed and suspended by Ohio State, Maurice Clarett tried to enter the 2004 NFL Draft - which was rejected by the NFL due to their draft eligibility requirement (3 years after high school). Clarett sued on antitrust grounds ,won in U.S. District Court, which was overturned on appeal. The Second Circuit ruled that the NFL was shielded from antitrust challenge under the Non-Statutory Labor Exemption since those eligibility requirements were the product of Collective Bargaining.
That is why a true decertification by a Players Association is viewed as the Nuclear Option - it could potentially expose any restrictions on player labor to antitrust challenge and damages.
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Originally Posted by Mork
Fugu is right that the CBA helps the owners more than the players.
It is true that before US courts struck down the MLB reserve clause, NHL owners used unfair power imbalances to abuse and underpay players. Howevern the game-changer that ended that is US anti-trust law, not the NHLPA.
Without a CBA every player would now be a free agent.
The Reserve Clause was not struck down by the courts - it was in fact upheld by the SCOTUS in the Curt Flood case (Flood v. Kuhn, 1972), upholding precedent and MLB's anti-trust exemption while at the same time saying it's previous rulings (Federal Baseball Club v National League, 1922 and Toolson v New York Yankees, 1953), which held that baseball was not interstate commerce and thus not subject to federal antitrust laws, were wrong but passed the buck to Congress to change them if they wanted.
Baseball's Reserve Clause was actually struck down by an arbiter, Peter Seitz, in 1975 under the dispute resolution terms of MLB's CBA - after Marvin Miller got two players (Dave McNally and Andy Messersmith) to challenge the Reserve Clause and file grievances. Miller had set the groundwork over the past decade and two CBA's - by first negotiating in a grievance procedure and then it's resolution by an independent arbiter.
Mork, with all due respect, at this point it is about the players getting the best deal they can under a linked cap.
If they are not willing to get back to the table under the cap system (that has served them very well by the way), they will be fighting each other for spots in Russia, Europe, or wherever else.
Guys, this is not about what is right, or fair in our opinion...it is about a "club" deciding about who the members are and what privilages or fees they are going to charge / accept. I really believe folks that think there will be a model besides a linked cap are delusional - and that includes the players.
There is a linked cap that was hard fought and won, and it is not going away. For the players to keep proposing other structures is a waste of time, and in my opinion makes them equally culpable in causing the work stoppage should it come to that.
You're quite right, the players have done very well under the cap.
You're wrong about the "club" intrernally deciding what "privileges" it will afford the players. Although it certainly was that way in the era when clubs could illegally collude to restrict player movement, to the effect that players could be blacklisted and the great Gordie Howe even let Red Wings management fill I'm the salary after signing his player contract each year, it is now truly a collective bargaining process whereach side depends on the other.
I have such disdain for the old-boy owners such as Jeremy Jacobs, the late Bill Wirtz (I like his son) and crooks like Ballard and others that I have let their past abuses of the players colour my posts. I just don't buy into the mentality that the players should be eternally grateful for the privilege of making owners like Jacobs, Wirtz and the Ontario Teachers Pension Fund (now Rogers Telecommunications and Bell GlobeMedia, two other entities not very dear to my heart) a ton of money. In doing this, I know that I've understated the players' dependence on the owners as well.
The players do need the owners to provide the capital and business organizations that allow them to earn the privileged incomes they enjoy. Without owners willing to do this, it would be difficult if not impossible for the players to fund and organize another business enterprise that would give them a comparable income-earning capacity all on their own.
Despite that, it is still a two-way street where each side depends on the other for their mutual success. It rankles me beyond reason when people suggest and owners act as though professional hockey is still nothing but an old-boys league where everything depends on the whim of the owners and the players should be happy to take whatever the owners may be pleased to offer. I just don't think that reflects reality, nor should it.
KDB, thanks for correctly stating that to which I incorrectly attempted to allude.
It boggles the mind to think what offers in this day and age the owners would make to an 18 y.-o. Steven Stamkos, Taylor Hall or Ryan Nugent-Hopkins if they were not able to restrict competition for their services by means of the amatuer entry draft. Without a CBA the owners could not collude to restrain trade in that way, and no greater evidence is needed of the owners' dependence on the collective bargaining process to effectively conduct their business.
Readers should of course take into account my pro-player slant, but it is still my impression that the owners have a long, long way to go in treating the players like the business partners they can't do without. I think the "old-boy" union-busting mentalityu permeates the owners attitudes when in fact "busting the union" should be the last thing on Earth the NHL would want to do. The NHL needs the union more than the players need the union.
I think the leverage the players have is that there is a group of teams that don't have much interest in a lockout. They are doing good business and continue to do so.
A lot of individual teams are pointed in the right direction and a lockout at this point could destroy the forward momentum they have worked to create.
Except that with a better CBA they can do better (financially) long term. As for the clubs doing well, that would include 4 or 5 of the 7 Canadian ones. At least until the Canadian dollar drops. The second that happens, things will get interesting.
I dont think the players have any leverage once the season starts. as the months go by they will have less and less leverage because the owners getting a deal they want will end up making them far more money(theoretically).
So the players best bet is to negotiate now while there is actually time or else the pressure will rise and their salary will fall.
I dont think the players have any leverage once the season starts. as the months go by they will have less and less leverage because the owners getting a deal they want will end up making them far more money(theoretically).
So the players best bet is to negotiate now while there is actually time or else the pressure will rise and their salary will fall.
If they are still negotiating after the season starts (meaning, they will have to agree to play under the terms of the current CBA until the new one is ironed out), the players will gain leverage as each day goes by. That's because Fehr will stall and stall (taking, for example, a month to respond to each league proposal, as he already has done here) and then have them go on strike at the point it will hurt owners the most - the playoffs. I don't believe the players get paid then, anyway, and that's when the teams make the extra money that they need to try to stay afloat or maybe even make a profit.
He did it in baseball, he'll do it in hockey. No doubt about it in my mind. The moment I heard the union had hired Fehr I could have told you we would be without hockey for a while. The only question is how long.
If they are still negotiating after the season starts (meaning, they will have to agree to play under the terms of the current CBA until the new one is ironed out), the players will gain leverage as each day goes by. That's because Fehr will stall and stall (taking, for example, a month to respond to each league proposal, as he already has done here) and then have them go on strike at the point it will hurt owners the most - the playoffs. I don't believe the players get paid then, anyway, and that's when the teams make the extra money that they need to try to stay afloat or maybe even make a profit.
He did it in baseball, he'll do it in hockey. No doubt about it in my mind. The moment I heard the union had hired Fehr I could have told you we would be without hockey for a while. The only question is how long.
Why would the owners care about losing games honestly if it comes down to it?
In 2005 it was the owners that simply waited for the players to respond. It took the players 5 months until they cracked because they were losing more and more salary every day.
The owners will gladly play the waiting game to get a better CBA. The players on the other hand will lose millions in salary. Fine for the big stars, but the 4th liners, 3rd liners and whoever that maybe need that money will definitely get a little anxious.
If they are still negotiating after the season starts (meaning, they will have to agree to play under the terms of the current CBA until the new one is ironed out), the players will gain leverage as each day goes by. That's because Fehr will stall and stall (taking, for example, a month to respond to each league proposal, as he already has done here) and then have them go on strike at the point it will hurt owners the most - the playoffs. I don't believe the players get paid then, anyway, and that's when the teams make the extra money that they need to try to stay afloat or maybe even make a profit.
He did it in baseball, he'll do it in hockey. No doubt about it in my mind. The moment I heard the union had hired Fehr I could have told you we would be without hockey for a while. The only question is how long.
You can say the same thing about Bettman. But, the NHL won't play without a new CBA, anyway. Non-issue.
Yeah LOL @ anyone claiming the players are greedy. NHL players on average are making far less than their counterparts in the MLB, NBA and NFL. It's small market, joke franchises that are killing this league. Bettman decided to award. approve moves and expansion to places where there is little to no market for hockey. As a result teams that have been fielding competitive teams for years like Detroit will no longer be able to do so due to cap restrictions. The current system favors teams that tank to gain draft pick like Pittsburgh, Chicago and Edmonton.
It’s 13 days to the official beginning of the NHL lockout which, depending on how long it lasts, will impact whatever legacy Bettman may have as commissioner. Should it go long, he will go down as the least effective long-serving commissioner in sports history.
3 FOR 3 in lockouts? Even his hero David Stern was able to avoid a lockout in 2005. Stern saw the NHL disaster and wanted no part of a second lockout right after the first lockout. Stern agreed to a new CBA with the players in 2005. It took them a month to put it on paper. It took the NHL a while to put this CBA on paper.
This describes the NHL problem to a T, with owners putting fiscal responsibility secondary to winning.
There are several owners like Pegula, willing to lose money to be competitive, however their spending raise player market values, thus pressuring all franchises.
The NHL has lacked the leadership from the commissioner's office that Rozelle provided the NFL. While Gary has done good things, he has failed to bring all the owners to realize the benefits of a league first approach.
So owners do whatever they feel benefits them, regardless of the bigger picture consequences.
Oh I see it's the owners fault. When a player gets an offer that is so high that he knows if he accepts the offer their will be no chance to win a cup with whats left on the table for others. I would like you to point out just one case the a player told the GM " no it's too high "
When players say that they are not the ones in charge of the business and if the team make or does not make money it's not the players fault. All the player wants is to play hockey and make the most money he can make. That is very one sided thinking don't you think.
If you can't blame a player for accepting a crazy contract then you can't blame an owner for demanding the players share the risk.
The players don't want to be held to account if any team loses money.
Let the owners fight to get me, I don't care if the team goes bankrupt, I just want the most I can get at all times and the f--k with the rest.
It's time to be in a 50-50 split
I don't believe in the case of RS it is a money issue either, I do believe it is more a case where the current system needs to be overhauled.
Just my guess.
From what I understand, its more how the money is targeted. I believe the players want a fund that effectively Bettman directs to the neediest teams. As you can imagine, the owners probably want none of that, he is supposed to represent them all fairly.
But the general premise I agree with, RS payments should be skewed to the neediest teams. I'm firmly with the players on this one.
No. One side will eventually offer something the other side can live with, and then they start to zero in on something that satisfies both sides.
I'd really not say that. If so, then its your premise that the players negotiated in bad faith in 2004 because they were offered a deal they cold live with, but washed out a whole year of hockey before accepting it?
I do not think any of us (especially me) would ever think the employees negotiated in bad faith in any CBA talk.
Fugu is right that the CBA helps the owners more than the players.
It is true that before US courts struck down the MLB reserve clause, NHL owners used unfair power imbalances to abuse and underpay players. Howevern the game-changer that ended that is US anti-trust law, not the NHLPA.
Without a CBA every player would now be a free agent.
And the players would be 5 minutes away from being let go if the owner/GM wanted.
Its a two way street. Looking and what the players would win/lose through desertification, I think its something the players could not live with.
A couple of points to throw into the fire that I haven't seen mentioned (although I admit I only read these threads sporadically):
1. Comparing the NHL to NBA is as reasonable as comparing the 2012 NHL to 2005 NHL. Both should be stopped, otherwise, what's next, comparing to the MLB? The financial realities of the leagues are different, and a lot also depends on how strong the union is, what quality dropoff one would see if replacements are used etc. As far as I am concerned, the only numbers that matter is the NHL actual finances in 2012.
It may not be ideal, but its the closest comparable. If you cannot compare against anything, then why is any more than 10% HRR fair? Why not 90%? Why not minimum wage?
If I go in for a job interview, the company is not going to pay me twice what an equivalent guy in the company is being payed. Nor would they offer 50% of that.
Comparables are the measure by which salaries are determined in all walks of life.
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2. When talking about the top market teams not willing to share their revenue with poorer teams, let's keep one thing in mind. Astronomical profits of those few teams are due to the cap only. If not for the cap, introduced due to the smaller market teams, the big market teams would be sporting 120+ million payrolls. By the way, speaking of comparables, I do not know of any business that would be making 40% profit on revenue, like these few teams do. Potentially drug dealers, but I haven't seen their books
Not a few of these teams. One of these teams.
Roughly
Tor - 45%
Mon - 30%
NYR - 25%
Edm - 20%
Det - 15%
Van - 15%
After that it is all under 10%.
And there are businesses who make those kind of margins. Oil companies are the easy ones of course. Lots of older cash cow types of business make out quite well in this regard. Heck, I was a contractor for a few years, my profit margin was 90%.
I will agree somewhat with the premise though, the salary cap really does inflate profits of the top 3 teams notably.
But the point is this CBA negotiation is not for the top 5 teams. It was not last time around.
Yeah LOL @ anyone claiming the players are greedy. NHL players on average are making far less than their counterparts in the MLB, NBA and NFL.
Far less? NFL actually pays a lower average salary.
But all in all, why wouldn't they? NFL has three times the revenue, MLB has twice as much, NBA has 75% more. So of course they can reward their players better.
