NHL Opens Collective Bargaining Agreement With Its Proposal, Volume 4

In the fourth edition of our look at the NHL Owners proposal to the players and Players Association (NHLPA), we are going to take the last four major issues. They are:

1. Entry level contracts be extended to five years versus current three years
2. Salary cap set as four million above median value, salary floor eight million below
3. Eliminate salary bonus payments
4. Salary level would have to be the same throughout the entire maximize proposed length of the five year contract

1. Entry level contracts extended to five  years versus current three years. On the face, I am fine with this item. As the players come off their entry level contract, they are not eligible for free agency of any type (unless they received their first contract at age 25) and the owners have the hammer to hand out one year qualifying offers for the minimum (current salary plus 10%). Unless you are a superstar like Oliver Ekman-Larson or Tyler Myers of the Buffalo Sabres, this would be your future. Having the five year contract would allow you to fully develop while in college or Major Junior Leagues. It would give the player security and the parent club a longer time to view its talent and make decisions with more data.

2. Salary cap set as four million above median value, salary floor eight million below. This one is dead on arrival. The median salary for NHL teams in 2011 was 60,702,740 million dollars. The floor would be $52,702,740, which is above what was spent by Ottawa, Carolina, Dallas, and the New York Islanders (and that is with the Rick Dipietro contract). These teams are not the ones who will protest. It will come from those who spend to the cap. They would have 64 million dollars to spend. A salary dump would be in order. There is no way the players are going to take all the changes to the length of contracts allowed, longer times until they hit unrestricted free agency, and then know they would have to take less money each year on top of all these other hits to their financial livelihood. The Flyers, Caps, Sabres, Canucks and Flames would be impacted  by this proposal. The Flyers were the top spender in 2011-2012. The new salary cap equal a  2.2 million dollar roster reduction. That was Jakob Varocek, who played in 2011-2012 for 2.2M and  resigned for 4.25 million this summer. So the owners would have not only removed his 2011-2012 salary at 2.2M, he would have not been in position to make 4.25M for next year.

3. Eliminate salary bonus payments. Bonus payments are not only to reward players who exceed in their expectations, but are used to keep players at a lower annual salary for arbitration purposes. It is easier to plan financially for the future if your player is at 1M annual with performance bonuses of $250,000 than to give them the 1.25M and then have to add to that figure in future contracts. The $250,000 is a static number with the 1M being dynamic. Future contracts would make the entire 1.25M dynamic. This is okay for a player at this salary. But take a Ray Whitney. Signed at 4M per year for two years with 0.5M per year in bonus. There is no way the team would have offered that additional money to a player at his age and salary. Ray would be out a potential 1M dollars. 1M is alot of money to have taken away at the end of your career. No too many tears will be shed for someone making 4M per, but move that “end of career” down to someone going into free agency. Now you cannot make up this money in future contracts, but every contract would be lower in value. The aggregate hit  is even greater. Players will not accept this offer.

4. Salary level would have to be the same throughout the entire maximize proposed length of the five year contract. As a player, I would like the prospect of knowing exactly what I would be making the entire contract length. However, if the salary cap goes up every year, you are making less money at the end of your deal than the first couple of years. I sign my five year deal this year. My contract runs from 2012-2017 at 1M per season.  You as owner would then be negotiating off  my 1M in 2017 dollars as the salary cap has expanded. I would want my 1M plus inflation plus improved performance plus increased cap money. So now we are at an impass and unless I am at the UFA status, there is no where for me to go. I’ve lost real dollars with this contract and won’t have the chance to make it up unless I had a breakout season and there were bidders for my services. The only way a player would want this agreement is if the cap is going to be reduced or the contract is guaranteed 100% for the entire length with bonus payouts.

If the NHL had not been in lockout eight years ago, I would probably be siding with owners in an attempt to keep the league viable and healthy. However, there was a lockout. And the owners have put themselves into the exact same position. The only difference is they reached the wall in eight years vs. the thirty it previously took. They did not learn their lesson, and the players were made to suffer with losing a year of salary. The same issues that got the league in this situation were ran toward with arms outstretched by the owners.

Ovi, Crosby, DiPietro given insanely long contracts. Paying Vinne Leino 4.5M is insane. Paying Dany Heatley 7.5M is even more insane. Heatley should be lucky to be on a minimum salary after his “sign me long term now I demand a trade” act. With that said, it was not the players who put a gun to the owners head and demanded the contract. All were offered and agreed upon by the owners. And ratified by the league.

Who will pay and suffer if the lockout extends? Players. TV contracts. Corporate sponsorship. And most importantly the fans. I was so disgusted and upset after canceling the World Series in 1994 due to the work stoppage that I stopped consuming baseball. I have not watched a game on tv nor have I spent one dollar of merchandise. The only time I have been to a game is when given free tickets. That has been 1 time. I was a huge baseball fan, growing up and rooting against the Yankees while cheering on the Blue Jays. With the multitude of work stoppages, I was done. And with that many casual and hardcore hockey fans will be impacted the hardest if the owners cannot reel themselves in and do what is best for hockey.