stuhackel
Tuesday June 26th, 2012

By Stu Hackel

The NHL Players Association has gathered in Chicago this week to prepare for what many think will be a contentious negotiation with the league's team owners on a new collective bargaining agreement. Those talks seem set to begin at week's end. On Montreal's TSN Radio 990 Monday, Bob McKenzie called the PA get-together, "The last big rally before they officially get underway," and it certainly seemed like that on Monday with about 50 players, including Jonathan Toews, Alex Ovechkin, John Tavares, Shea Weber, Shane Doan, Alex Burrows, David Backes and Jamal Mayers attending.

The big question on everyone's mind, of course, is will there be a work stoppage in September or will an agreement be reached to avert one? Although neither side has officially presented the other with a proposal yet, Michael Grange of Sportsnet.ca reported that "there have been quiet 'off-the-record' conversations taking place between the key figures on each side: NHL Commissioner Gary Bettman and Deputy Commissioner Bill Daly, with (NHLPA executive director Don) Fehr and his brother Steve on the other as the NHLPA's special counsel."

Most believe that the sticking point between the sides will be the owners' quest to change the split in hockey-related revenue that is dedicated to player salaries. It's currently at 57 percent. Recent deals reached in the NFL and NBA came after the owners locked out the players and forced them to accept a split of around 50 percent. It's not something NHL players favor, having absorbed a 24 percent salary rollback to end the 2004-05 lockout and have the owners impose the salary cap system on them. As it turned out, the cap system worked well for the owners, who have experienced record annual revenues (currently $3.3 billion annually, up from $2.1 when the current agreement was signed), and it hasn't been awful for the players, either, with the rising cap and floor accounting for regular salary increases. But with an unspecified number of franchises supposedly sputtering financially, the owners want more changes.

"From our standpoint, the starting place is that the players made enormous concessions last time around," Fehr said on Monday in the video embedded above. (Sadly, the audio is not very crisp.)  "The second item that comes to mind is that the game generates a lot more revenue than it did before. You put those two things together and it ought to point you in a direction as to where this negotiation should go." From the players standpoint, that would mean a better system of sharing revenue among the owners.

“The players had their salaries rolled back by 24 per cent but somehow none of that [money] got into the hands of the small-revenue owners,” player agent Anton Thun of Toronto told David Shoalts of The Globe and Mail. “The reason for that is the revenue redistribution model didn’t work.”

Renaud Lavoie of RDS points out that NHL clubs share about six percent of league-wide revenues. By comparison, he writes, NFL clubs share about 60 percent which allows mini-markets, like Green Bay to stay in the league. Without revenue sharing, the Packers would be what the Coyotes are currently in the NHL.

The NFL has shared revenue on a large scale for about 50 years; it was the vision of then-commissioner Pete Rozelle. The big difference between the two sports -- and also between the NHL on one hand and the NBA and MLB on the other -- is that in hockey, the teams generate more of their income than the league while in the others the leagues generate more than the clubs.

There has always been resistance among ownership to drastically adjust revenue sharing instruments. Many big revenue clubs are loathe to contribute more than they already do to support small market teams, some of whom are fierce competitive rivals. Consequently, ownership seeks to recarve the revenue pie with the players as an instrument in supporting weaker franchises.

“We don’t want to give up too much and they want to get as much as they can. That’s the whole thing,” Doan told Shoalts.

Whatever talk there is of a work stoppage, Fehr emphasized that the players haven't initiated it. "None of that is coming from our side; that's the first thing," he said (video). "Secondly, we have not made a proposal and we haven't heard an owners' proposal. So unless somebody on the other side, on the owners' side, knows something which makes that likely, I can't explain it."

But toward the end of his remarks, Fehr made the point that while he treats a strike as a last resort when negotiations don't result in agreement, "The problem you have in the salary cap sports, going back 20-plus years now, is that in many cases historically -- I'm not saying it will be true this time -- a lockout has been the negotiating strategy of choice; which is a little unfortunate, because you can get self-fulfilling prophecies in this business. Hopefully, that's not going to be true this time."

"I'm not optimistic to be honest with you because I don't like the dynamic," McKenzie said Monday (audio). "This is going to be another takeaway negotiation as far as the National Hockey League is concerned. Hockey-related revenue is at 57 percent in the NHL. The NFL and the NBA just did deals that were 50 or less. So you know the NHL is coming for a very similar type of deal to what the other sports have got. So in its very nature, it's the NHL coming to the Players Association and saying 'We're coming for your money, we're coming for more of your money....That's the nature of professional sports where the owners keep coming back to the players and grinding them for more....

"The flip side of that dynamic is that you have a new NHLPA boss and his name is Don Fehr. And his reputation in baseball was that nobody even gets a free lunch with Don Fehr. You've got to bargain hard for everything that you get. Don Fehr cannot come in here in a takeaway negotiation and be perceived as weak. He was hired specifically to get this Players Association organized because they were in a state of chaos after the dismissal of Paul Kelly. So he's rebuilding it from the ground up and the last thing he can do is sit there and say, 'Oh, yeah, you want seven percent more of hockey-related revenue? Sure, no problem, here you go. What else would we like to do? OK, great, we'll be ready to play in time. Is that OK? Is everything good?' That's not the way it's going to go. The way it's going to go is, he's representing the best interests of the Players Association and that if it's going to be a takeaway negotiation, it's not going to be an easy takeaway negotiation. So I'm not saying we can't start on time next fall, I'm saying I'd be surprised if we did."

Nevertheless, Fehr sounded a more optimistic note when he said, "There's plenty of time to negotiate an agreement between now and Sept. 15. By the way, there's nothing magic about Sept. 15 and the law is if you don't have a new agreement, as long as both sides are willing to keep negotiating you continue under the terms of the old one until you reach an agreement." He noted that when he headed up the MLB Players Association, the players once went two full seasons without a new CBA.

If having a broad cross section of players involved in the union's activities was a goal for the PA's new leadership, that seems to have been achieved. It's apparently part of the PA's strategy to involve as many players as possible in reaching a new CBA, including a negotiating committee of at least 30. Fehr noted that a lot of players will be coming in and out of the negotiations and he expected a great deal of participation in the regional meetings the PA will conduct in August. He acknowledged that a large percentage of the current players entered the league since the last lockout ended, and he had a lot of work to do familiarizing them with the background to these negotiations, the history of NHL labor relations and the issues facing them this time around.

"It's absolutely clear to me that they are (taking this seriously)," said Fehr. "This is true from the youngest player that just got here and is sort of looking around trying to figure out if he belongs and some of the biggest stars that we've got. You'll have a bunch of players of varying levels of celebrity that will be here this week and there'll be all kinds of players coming through the bargaining meetings once they start...."I expect a very wide participation from all parts of the membership."

Grange has a good article on Sportsnet.ca about the youngest player rep, John Tavares, that is worth reading.

The large negotiating committee is different from the way the PA proceeded in 2004-05 when only seven players were at the table.

"It was tough (as a small group), so many guys want a piece of you, so many guys want to be informed and want to talk and you're flying everywhere -- I think I flew Dallas to Toronto 19 or 20 times -- so a big number of guys, that's good," Bill Guerin told Grange. "Sharing the load is important."

Guerin is less pessimistic than others about where this might go, believing that the system only needs some adjustments, not a major overhaul. "I wasn't optimistic at all last time, not even close, but this time, you know what? We went through it, there is a cap system in place. We'll see what tweaks are made, but the big thing is the system is in place."

"What it comes down to, everyone wants to play hockey," Toews said. "We want to play hockey and the fans want to see hockey. We just want to see things come together for both sides and make sure both sides feel like they've been respected and treated fairly."

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