NHL, NHLPA Declare a Truce, but the Battle May be Far From Over

The two sides have agreed to not renegotiate the CBA, but there's still an enormous elephant in the room - prorated salaries - that will have to be resolved if the NHL and its union want labor peace.
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If multiple reports are to be believed, the NHL and the NHL Players’ Association have worked out all of their monetary issues with respect to the collective bargaining agreement and all that’s left to do now is to plan how the 2020-21 season is going to be played starting Jan. 13.

Not so fast, said one prominent NHL player agent. “That’s not how I see it,” Anton Thun told TheHockeyNews.com. “I think that perception is B.S. My reading of the situation is that each of the parties has essentially reverted back to the terms of the memorandum of understanding (MOU), which I don’t see as the solution to the issues that have been discussed. It seems to me that, unfortunately, it appears to leave these issues unresolved.”

In fact, the reality may very well be that nothing has been sorted out between the two sides when it comes to their economic stalemate and that they have basically gone back to their battle stations. No, there will be no increase in the 20 percent escrow to which the players agreed, nor will the players be required to defer any more than 10 percent of their salaries in 2020-21. That was all agreed upon in the extension of the CBA in the summer, yet the owners came back with an attempt to bump escrow for this season up to 25 percent and salary deferral to 26 percent.

But the fact that apparently won’t happen doesn’t prevent the NHL from pressing to prorate player salaries next season. Nor does it necessarily prevent the league from invoking a force majeure to try to get concessions from the players. And what you know of the NHL and how it operates, do you really think it is going to agree to a scheme in which the players play 68 percent of a full season (56 games) and are paid 100 percent of their salaries, less escrow and salary deferral (for a total of 72 percent)? In fact, I posed that precise question to NHL deputy commissioner Bill Daly in the following way: “In the league’s talks with the NHLPA about this season, has it been firmly established that player salaries will not be prorated this season, despite the fact the schedule will be 56 games (68 percent of a normal season) and not 82? Does the league believe it has the right to prorate salaries for 2020-21? Have the two sides found common ground on this?”

Daly’s reply: “I would rather not comment on this, at least until we have something to announce regarding the entirety of our plans for next season.”

In fact, there are those who believe that the landscape changed, not because the NHL backed down from its original gambit to receive concessions from the players, but because of something that happened in the National Basketball Association recently. In late November and early December, the NBA went to the private markets to secure $900 million at discounted interest rates that it is distributing to each of its teams. So each team will receive $30 million from the league to cover pandemic-related costs and help make up for lost revenues. “In my opinion, the players got bolstered when the NBA found a solution that the NHL hasn’t been talking about,” Thun said.

So where does this leave everything? Well, probably back where it started. And it still has to do with the MOU, which both sides will say works in their favour. When asked whether not the NHLPA had received, in writing, assurances that the league would definitely not prorate salaries this season, a players’ association spokesman replied, “The MOU sets forth the terms for the NHL and the PA.”

The only problem is that MOU could be interpreted one way by the NHL and another way by the players. And that creates a number of elephants in the room. Can the league prorate salaries? And can it still use Paragraph 17 of the Standard Player’s Contract or Article 5 of the CBA, both of which deal with the league’s ability to cease or suspend play and dictate the terms of the season? The league would likely argue it can. And the players would claim the opposite is true.

Of course, it’s also possible that the owners have thrown up their hands and want to get the season going and are content to have the players take more years to make up for lost revenues, but that flies in the face of the league’s attempt to renegotiate in the first place. It actually seems that both sides are deliberately avoiding talking about this to avoid conflict. But it is going to arise sooner or later. For example, what happens if the league cuts the first paychecks to the players with prorated amounts? What will happen is the matter will fall to an arbitrator or the National Labor Relations Board.

“If the PA is correct in its interpretation of the MOU, they would have to argue to the NLRB or arbitrator that the players get 72 percent of their salaries, even if the season is only one game,” said Richard Rodier, a lawyer who has consulted both for a prospective NHL owner and the NHLPA. “That would be a very difficult argument to make. I would be surprised if the NHL owners have agreed to that.”

And the longer the players and owners go without addressing that elephant in the room, the bigger it’s going to get.

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