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2018-2019 NHL Thread – Thunderstorm Warning

Don Fehr's memo to players last night:

Today, we met with the NHL off and on over several hours. A number of matters were discussed, including our proposal for a new pension plan, revenue sharing, the players’ share and salary cap issues, and the owners’ “make whole” concept. Present today were Chris Campoli, Mathieu Darche, Ron Hainsey, Johan Hedberg, Manny Malhotra, and Kevin Westgarth (David Backes was present for part of the day), as well as Mathieu Schneider, Joe Reekie, Steve Webb and Rob Zamuner.

No new proposals were exchanged on pension issues, but we will discuss this issue again tomorrow (Friday). We did receive a proposal on revenue sharing in response to the proposal we made this week, but this subject still needs considerable work.

In addition, we received a revamped proposal covering players’ share and cap issues, their so-called “make whole”, and player contracting issues. The owners finally did formally give us their “make whole” idea, which in dollar terms is similar to the discussions Bill Daly had with Steve Fehr a few days ago. While a step forward, a significant gap remains. Moreover, at the same time we were told that the owners want an “immediate reset” to 50/50 (which would significantly reduce the salary cap) and that their proposals to restrict crucial individual contracting rights must be agreed to. As you know, these include – among other things – losing a year of salary arbitration eligibility, allowing the team to file for salary arbitration in any year that the player can file, extending UFA eligibility to age 28 or 8 seasons, limiting contracts to 5 years, and permitting only 5% year to year variability in player contracts. Individually each is bad for players; taken together they would significantly reduce a player’s bargaining power and give the owner much more leverage over a player for most if not all of his career.

In short, the concessions on future salary we have offered (at least $948 Million to $1.25 Billion over five years, depending on HRR growth) are not enough. We are still being told that more salaries must be conceded, and that very valuable player contracting rights must be surrendered. So, while we are meeting again, and while some steps are being taken, there is still a lot of work to be done and bridges to be crossed before an agreement can be made.

We will review today’s discussions over night and tomorrow morning before meeting again with the owners. Following our meeting tomorrow with the league, we will be able to provide a broader update.

As always, please contact us if you have any questions or comments.

Best regards.

Don
 
The reporters seem to be saying that all these leaks show how much work there is to be done. But it seems to me that they show how little work has been done. 20+ hours of meetings and the two sides have moved approximately one inch closer towards one another. At this pace I'm going to start hoping the 2013-2014 season isn't cancelled.
 
The good news is they are only about 4 inches apart so it should not take that much...but then again they haven't been that far apart from the start.
 
I don't see the progress either. It sounds like 20-some hours of negotiating and they are still holding the same stances they held before.
 
The good news is they are only about 4 inches apart so it should not take that much...but then again they haven't been that far apart from the start.

Hm, good point. At this rate of an inch or so per month they should definitely reach an agreement on the major issues in time to hammer out the final details in advance of the free agency period next July. Optimism!
 
What is the NHLPA's opposition to a make whole provision paid out of the players' share of future revenue? Seems like that would honor the existing contracts and get to the immediate 50/50 split the owners want.
 
What is the NHLPA's opposition to a make whole provision paid out of the players' share of future revenue? Seems like that would honor the existing contracts and get to the immediate 50/50 split the owners want.

I'll admit I don't know the details of how it would work, but it seems like a hidden rollback to me. How would the $ to the players be different if there was an immediate rollback to get to 50/50 vs. 50/50 split with deferred payments?
 
Hmm, Bryz.

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OK, it is Friday afternoon and I’m clearly not getting any more work done today, so I’m going to lay out my understanding of the escrow process and “make whole” at a high level. Bear with me. If you guys think I am misunderstanding anything, let me know, I’m trying to understand how this would work.

So the players (and I assume the teams) pay a portion of their earnings into escrow accounts. At the end of the year, it is determined what the annual revenue total was, and the escrow accounts are used to ensure a 57/43 split. So if GMs have committed more than 57% to players, the players don’t get the full value of their contract for that year as they don’t get their full escrow payment back. If GMs have committed less than 57% to players, the players get more than the value of their contract to get to a 57% split.

From what I’ve read, over the term of the last CBA, the players got about 97% of their salaries. So, averaging over time, GMs tended to commit around 57% of revenue to player contracts.

Let’s say next season they are able to get to a 50/50 split somehow. The NHL makes $4B, so $2B is allocated to the players. Since GMs seem to be close to the split, let’s say they committed $2B to the players. The players paid, maybe, 10% into escrow. So there is $200MM in escrow that will be refunded in full to the players to get them to $2B.

Now, let’s say there are deferred payments due to “make whole.” The players have still paid in $200MM of their $2B in contracts to escrow. The players would be getting the $2B that is their 50% share. But, before the distributions are made, they need to pay off the deferred payments associated with “make whole” to players under contract this season. So part of that $200MM is paid to “make whole,” and whatever is left is refunded to the players. So all players would be getting less than their 2013-2014 contracted salary, and less than they would be getting if there wasn’t that “make whole” provision.

It seems players that sign a contract under the new CBA will be screwed the most. The escrow payments they made from their contracted salary will be used to pay off “make whole” for the other players and they only get a portion back.

Meanwhile the owners are getting the same $2B (50/50 split) that they would've gotten if salaries were rolled back. The league figured out a way to make an offer and say "no rollbacks" without giving up a single cent. Sketchy.

Am I missing something?
 
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That may have been my longest post ever on the boards.

Summary: If "make whole" is funded by the players' share, it seems like it is just reallocating payments from one player to another, and all players would get less overall.
 
http://www.startribune.com/sports/blogs/178216921.html

This is huge. Blog is pretty much saying the NHL has offered the players everything they want but Fehr has not given this offer to the players. I don't know what to think. I would be so disappointed if Fehr has actually done this.

Oooooooh snap. The owners released a (likely biased) summary of their offer to the public in an attempt to reach out directly to the players and discredit Don Fehr? Wow, they haven't tried that tactic in... almost a month! (But seriously, every attempt the NHL has made to turn the players against Fehr has backfired and set the process back, why in the world would they think this one would turn out differently?)

From what I've read, the owners have offered to pay $211MM into "make whole" and have presented a model that shows that this is enough to cover the players' salaries plus interest. The players disagree with the model. But either way, we're stuck at the same place, both sides have agreed to reach 50/50 by year three, but neither will negotiate off the others' method of getting there. Someone needs to either work off the other sides' method or introduce a new method, because this nonsense is a clear (stupid, unnecessary) block in the road.

Mirtle had them at about $500MM apart before this round of talks. The owners have moved $200MM closer, and the players have presented an offer, so they must be closer as well. At this point, any break off of talks would be the absolute height of stupidity. (I thought we had reached that before, I was wrong.) Hopefully cooler heads prevail today and they get back to talking.

Have I mentioned that I hate these people?

ETA Friedman's recap: Gloves are off in NHL labour talks
 
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For Skins, since you don't have a Twitter, your boy on the shenanigans from last night:

Alex Ovechkin ‏@ovi8
Hahaha Whata clowns!!!....Don tell it all. Bla blah ...make a deal instead of talk about Don!

Though I think the best was from Logan Couture:

Logan Couture ‏@Logancouture
Breaking news! NHL sources claim Donald Fehr is the reason Justin Bieber and Selena Gomez break up!..

Anyway, no more meetings today, no reports on possible meetings tomorrow. It kind of sounds like the owners are reaching their "take my toys and go home" stage but don't want to be the ones to initiate a freeze out for the third time in a row. Hopefully everyone calms down and realizes how freaking close they are.

Also, although I wish he was no where near a negotiation I had a vested interest in, Don Fehr is fascinating. He seems to be the only one who has not lost his cool in this whole process. From Puck Daddy:

Donald Fehr, NHL tormentor, is controlling CBA negotiation
 
For Skins, since you don't have a Twitter, your boy on the shenanigans from last night:



Though I think the best was from Logan Couture:



Anyway, no more meetings today, no reports on possible meetings tomorrow. It kind of sounds like the owners are reaching their "take my toys and go home" stage but don't want to be the ones to initiate a freeze out for the third time in a row. Hopefully everyone calms down and realizes how freaking close they are.

Also, although I wish he was no where near a negotiation I had a vested interest in, Don Fehr is fascinating. He seems to be the only one who has not lost his cool in this whole process. From Puck Daddy:

Donald Fehr, NHL tormentor, is controlling CBA negotiation

Glad to see I understand Ovi's tweets as well as I understand his interviews.
 
Katie Strang ‏@KatieStrangESPN
#CBA Meeting lasted less than an hour. NHL completely unwilling to budge on any player contracting issues, according to Don Fehr

Katie Strang ‏@KatieStrangESPN
#CBA Make Whole and HRR not discussed at all. Only contracting issues. And given respective sides' positions, doesn't leave much optimim

Katie Strang ‏@KatieStrangESPN
#CBA Given NHL's stance on contracting issues, Fehr said he doesn't currently "see a path to an agreement"

Katie Strang ‏@KatieStrangESPN
#CBA According to Fehr, NHL commissioner Gary Bettman said during meeting that "we're past the point of give-and-take."

Well then.

Bob McKenzie: ON DAY 57, DO YOU KNOW WHERE YOUR CBA IS?

^^ Long read, but he thinks that the players might have accepted (or at least gotten close) if the league had made this recent offer in October when there was still a chance for a full season.
 
Katie Strang ‏@KatieStrangESPN
#CBA Daly said league knows how important player contracting issues are to union but feels these issues also important to owners

Does anyone else read that as "the recent reports that we don't really care about most contracting issues really hurt our negotiating position, so now we're pretending to care so that we can convince the players to give in to revenue demands in exchange for concessions in our contracting demands"?

Anyway, the Hockey Hall of Fame events should be interesting!

Down Goes Brown ‏@DownGoesBrown
Even Gary Bettman could not possibly be arrogant enough to ruin the HHOF induction by showing up under these circumstances, probably, maybe.

Harrison Mooney ‏@HarrisonMooney
If Gary Bettman shows up at tomorrow's HHOF ceremonies, someone needs to throw the Presidents' Trophy right at his head.
 
Throw the trophy at his head- LOL! He would have to be unbelievably arrogant and stupid to show up. Hmmmmmmmm? Should be interesting indeed!
 
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