Haggerty: Things just got real with the NHL labor situation

Haggerty: Things just got real with the NHL labor situation
September 1, 2012, 3:13 pm
Share This Post

Most with an understanding of the NHL labor issues both overt and underlying expected this moment to arrive.

That didnt make it any more disheartening when the NHL and NHLPA both decided to take a recess from CBA negotiations at the end of this week with no further discussions scheduled. Both NHL Commissioner Gary Bettman and NHLPA Executive Director Donald Fehr addressed the media after a brief 90 minute bargaining session, and it sure sounded like the two sides were stuck-fast at an impasse.

Perhaps most interesting of all, each side charged the other with calling for the break in the talks with nothing officially scheduled after the Labor Day weekend.

We have advised the commissioner and Bill Daly that the players and staff will be in New York for the next two weeksand therefore we are available to continue meeting, said Fehr. But at this point the talks are recessed. We will not be discussing these issues again unless or until there is word from the NHL that they are ready to continue. Hopefully that will be soon.

Of course there are still two weeks before the Sept. 15 date when the previous CBA officially expires, and an agreement up until then means the NHL regular season goes on unaffected.

But Bettman stood firm to the NHLs latest meaningful and significant proposal the league claims would give the players back upwards of 400 million in prospective salary while making it close to a 5050 split between the owners and players.

Of course Fehr and the players dont see it that way at all. Theres the rub.

During this period and this is a good thing the league has had record growth. I believe there have been record revenues every year, or virtually every year, with a big revenue jump in each of the last two years, said Fehr. Given those things the players overall feeling has been that they are not prepared to and dont feel its appropriate to see an absolute further reduction in their aggregate salaries.

The owners have the salary cap system that they want and that incorporates already large reductions in players salaries. Then the question is if there are further issueswhere do we look for the responsibility in those. The players made a very forthcoming proposal to the owners in an effort to find an agreement by limiting salary growth to a specified dollar amount over the next three years. The theory is that the player concessions in the first three with revenue growth could allow the NHL to grow their way out of whatever problems they perceive that they have.

The NHLPA contends the second proposal moved their percentage of Hockey Related Revenue (HRR) as its currently defined -- from 43 percent to 46 percent.
Thats still an 11 percent drop from the players current 57 percent slice of the revenue pie. Thats also roughly 363 million in salary the NHL wants back in their pocket books while dropping the salary cap to 58 million to reset player salaries back to what they were in 2008-09.

Under the NHLs latest proposal the NHL salary cap, 16 teams over that amount scrambling to dump salaries and essentially turn back the hockey clock with clubs like the Bruins and Flyers in serious cap trouble. The NHL is essentially looking for a do over after their owners handed out lengthy, exorbitant contracts to superstar players including the Minnesota mega-deals to both Zach Parise and Ryan Suter earlier this summer.
Some might call that cold-hearted business, and others would call it incredibly disingenuous for a league to approve contracts it knew wouldnt be sustainable under a new Collective Bargaining Agreement.

Bettman essentially told the players theres nothing to talk about if theyre not willing to go along with the cost-controlled main objective from the league, and Fehr was adamant about revenue sharing as a viable alternative to slashing player salaries.

Instead Bettman calls the revenue sharing thats insulated all Major League Baseball franchises a distraction and says its got nothing to do with the leagues objective to reduce the NHLs player payroll amount.

There was no counter-proposal or new proposal from the players. There was some discussion of revenue sharing and I dont even know why because that doesnt address the fundamental business issues. We dont believe that revenue sharing fully addresses the issues that we feel need to be addressed, said Bettman. The union was clear on the economics where we moved 460 million on Tuesday that theyre not ready to move anything at all. We both agreed that when one of us has something to say that well pick up the phone.

Were not going to respond further with a proposal based on their non-movement within the economics. We believe we should be paying less to the players. We believe that 57 percent of HRR is less than we should pay.

Bettman wouldnt give reasons why the league should be paying less to the players but its clear the NHL is attempting to help out the 8-10 teams that are losing money each season. Its also clear the owners are looking to cash in more fully with the NHL on the verge of its biggest profit boom in the sports history.

Theyre hoping to create league-wide health with their hard line stance, and line their own pockets at the same time.

The mere fact the NHL watched a record 3.3 billion in revenue stream into their coffers last season betrays that they already hold the solution for their lesser franchises fiscal problems.
Something just seems fundamentally wrong about a league thats broken revenue records nearly every season since their last lockout, and now wants employees to take a haircut on their payroll. Beyond that the two sides cant even come to an agreement on the length of a new deal: the NHLPA wants a four-year deal and the NHL wants something in the six or seven year deal.

Its as if the NHL and NHLPA are speaking different languages, and they dont seem willing to invest in a translator. One thing is pretty clear from fan feedback: the court of public opinion is strongly and squarely on the side of NHL players that have already admitted they are ready to make sacrifices in order to preserve the health and well-being of the game they love.

A Pro Hockey Talk poll of fans showed that the NHL ownersBettman have little support from the ticket-buying customers.

The fans dont like Bettman or the NHL owners, and they dont trust them either. Its a dangerous game the NHL Board of Governors is playing while continuing to push a loyal fan base that already boos Bettman at every Stanley Cup ceremony with vitriolic luster.

At some point the fans wont come back, and theyre not buying what Bettman and Co. are selling right now on any level.

The NHLPA is looking for a partnership with the NHL to preserve franchises like Phoenix, New Jersey and Florida that seem to perennially find themselves under water financially. Bettman and Co. are still treating it like its a dictatorship and that the players will ultimately bend to their will once things get real in October.

Gordon Gecko found out at the end of Wall Street that perhaps his Greed is Good mantra wasnt all its cracked up to be. Unfortunately the NHL may find the same if they go through with their third work stoppage in the last 18 years that now seems inevitable.