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Hope dashed as CBA talks stall again

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NHL Commissioner Gary Bettman

Described by one witness as “seething”, NHL Commissioner Gary Bettman expressed disappointment that no progress had been made and that he could not see what the next step would be. (Photo by Bruce Bennett/Getty Images)

By Stu Hackel

The optimism that some people felt when the NHL handed a new offer to the players on Tuesday quickly faded Thursday after the league rejected the NHLPA’s counter-offers that union members said were based on what had been presented to them. The players had three approaches that would all get to the 50-50 split in Hockey Related Revenue that the owners want, except that the split would not be realized in the first year of a new deal, only after a few seasons. The owners continue to want that division immediately.

As a result, talks — which only lasted about an hour today — have stalled once again and, barring some sort of reversal by one of the parties very soon, the league’s hope that a full season can be played now seems gone.

The three approaches that the players served up, as Donald Fehr presented them to the media afterward, were rejected in about 15 minutes, according to the NHLPA executive director, and publicly disparaged afterward by Commissioner Gary Bettman, saying they didn’t get to the goal of 50-50. While it’s true they did not agree to 50-50 immediately, the NHLPA did, for the first time, agree to move to a 50-50 split in various ways over a few seasons.

“I wish I had better news,” said Bettman, a phrase he’s used before in recent weeks. He called the most recent owners’ proposal, “the best offer we could make.”

“Today is not a good day,” Fehr said. ” It should have been, but it wasn’t.” He said the NHL was only prepared to tweak its own offer, not listen to others. As Michael Grange of Sportsnet tweeted, “Fehr – the vibe we got was unless we were ready to sign their deal, don’t bother us.”

The PA’s first proposal would have the players get a fixed share of HRR during the first three years of a new CBA and their share of the presumably growing pie would be frozen afterward until it hit 50 percent. Now, that percentage is not guaranteed. It depends on how much league revenue grows, but Fehr said he believed the business would get to 50 in three years.

Their second proposal used the owners’ projection that the business will grow at a five percent rate. (It’s grown seven in recent seasons.) The players would get down to 50 percent by taking only 24 percent of that growth over the next five years, which would get them to 51 by Year 4 and 50 by Year 5.

The third proposal, perhaps the most intriguing  — and certainly the easiest to understand –  is that the players would go to a 50-50 split of HRR now if the owners promise to honor all the contracts they have signed — with no escrow. “Now that’s a move that could put pressure right back on NHL,” tweeted James Gordon of The Ottawa Citizen.

The problem with that third proposal from the NHL’s standpoint is that the owners cannot honor the existing contracts and still have a 50-50 split of revenue without actually increasing what they pay the players unless they somehow withhold some of the payment on those existing contracts. They’d also have to fund the full payment of the existing contracts later by reducing what they will pay players later when their contracts expire. Neither of those is agreeable to the players, who want the owners to live up to the individual contracts they negotiated, apparently don’t want any of it withheld and don’t want those existing contracts funded by reduced deals down the road.

After the meeting ended, Bettman spoke to the media first, and David Shoalts of The Globe and Mail tweeted, “As soon as Gary Bettman stepped to microphone you knew it was bad news. Almost always he keeps his cool in public. This time he was seething.”

Here’s video of Bettman’s remarks. The case he argues is the players are not moving away from their first offer.

Bettman confirmed that the PA had offered three proposals, none of which he said “even began to approach 50-50.”  He said they would mean a rise in salaries during the first year and characterized them as “nowhere close” to what the owners had proposed, a “step backward” and merely a variation on what the NHL had been offered over the summer.

He termed the owners’ offer from earlier in the week “a fair and balanced deal… It would give us long-term stability.” He added that some of the owners didn’t even want this latest offer presented, saying that they felt it went too far in the players’ direction. But after hearing the PA’s counter, he said, “We are not speaking the same language,” echoing similar statements he has made before.

“Obviously as the calendar ticks away we’re going to be cancelling more games,” he said and added that the Winter Classic was now in jeopardy.

“I am, to say the least, totally disappointed,” Bettman said as he headed back to New York. “I don’t know what the next step is.”

How much of those remarks reflect real dismay and how much is gamesmanship designed to get a another quick response from the PA that is closer to what the owners have offered, or to simply curry favor with the fans, will only become clear over the next few days.

ESPN’s Pierre LeBrun tweeted that an NHL team exec told him this about the NHL and NHLPA: ‘They are both posturing.’” That’s another thing that will only prove true or not over time.

Here is the video of Fehr’s remarks. He makes the case that the players are indeed moving in the owners’ direction even though the league has experienced record growth over the past seven years.

With 19 players in tow, Fehr spoke to the media shortly after Bettman and outlined the points above. He said the calculations the PA has made show that the owners would, over five years, save between $796 million and $1.117 billion on the first option the players presented and $854 million to 1.059 billion on the second option. They haven’t run the numbers yet on the third option but none of them proved acceptable to the owners. “What we didn’t do,” Fehr said, “was give the owners savings of billions right now against the record growth they have enjoyed.”

Instead the owners are holding firm on what they offered on Tuesday which calls for immediate reductions to players salaries by over 12 percent, including, apparently, those who have existing contracts. “If you assume that’s their best offer,” Fehr wondered, “why in the world did we see it four weeks into a lockout? Why didn’t we see it on September 14th or August 10th or July 13th or whenever it was they made their proposal for a 24 percent rollback.”

He added that the PA told the owners that it also wants to discuss revenue sharing, individual contracting issues and modifications the league wants to make to HRR, but those subjects didn’t come up in Thursday’s talks. The owners seem insistent on making this complicated negotiation all about one thing: The share of HRR they want the players to accept.

Asked what happens now, Fehr replied, “We communicate with players and agents, and go back to work to see if we can figure out something else.”

Here is video of remarks made by Sidney Crosby, Jonathan Toews and Shane Doan that you might find interesting.

The NHLPA planned another conference call for late afternoon. It also conducted a lengthy conference call with its members prior to the meeting in Toronto to develop and refine what was to be presented to the owners. A number players were part of the NHLPA delegation that attended (15 are listed here, and there were a few additions) along with Don and Steve Fehr and additional staff.

The owners were represented by Chairman of the Board Jeremy Jacobs (Boston), Ted Leonsis (Washington), Murray Edwards (Calgary), and Craig Leipold (Minnesota) along with Bettman, deputy commissioner Bill Daly and staff.

Via Twitter, Josh Rimmer, a producer on the NHL’s XM satellite radio channel, quoted the Blues’ David Backes as saying, “We feel our newest proposal took a great step towards getting a deal done. It’s too bad the owners don’t feel that way and I fear that we may miss an extended amount of time now.”

That’s the latest from the battlefront.

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  • Published On Oct 18, 2012
  • 2 comments
    John9
    John9

    I want to understand your viewpoint, but it doesn't hold water for me.  So say I sign work contracts with you and your friend, each with a face value of $10, but each CLEARLY stipulating that your pay will be based on a variable income pool.  If that pool ends up less than $20, I will pay you each a reduced amount based on your part of the pool; if more than $20, I will pay you more.  The amount of the pool will be based on a pre-defined calculation and after 9/15/2012 neither party will be obligated under the terms of the agreement.  

     

    It appears that you, similar to the players, are arguing that, #1, anything less than a $10 payout to each of you must be unfair (just ignore the contract terms) and, #2, any attempt on my part to offer a new contract with a different pool calculation after 9/15/2012 is again somehow unfair.  Is that pretty much it?

    Stu Hackel
    Stu Hackel moderator

     @John9 No, that's not it, because the mechanism that states your pay is based on a variable income pool is what has expired and what is being negotiated.