The owners and players have transformed the National Hockey League from a $3 billion business into a punch line. The cruel joke is a long one.
The NHL lockout hits the 60-day mark today, and there are only faint hints the work stoppage could end. Core economic issues still divide the league and the NHL Players’ Association. Player contracting rights have halted negotiations. Most recently, deciding who should take a costlier hit from lost revenue has turned into a sore spot.
“The issues aren’t all that complicated,” NHL Deputy Commissioner Bill Daly said Tuesday in an email to The Buffalo News. “It doesn’t mean we don’t continue to be far apart on them.”
The stalemate has made even diehards lose interest, and it cast a shadow over this week’s celebration of the sport. At a Hockey Hall of Fame luncheon Monday in Toronto, emcee James Duthie opened the program by acknowledging the quarrel.
“There’s two figures everybody’s talking about,” said the hockey host for Canadian sports giant TSN. “You know, if you could just stop saying all the nasty stuff about each other in the press, get in the same room together, figure it out, get it done. I’m of course talking about Justin Beiber and Selena Gomez, who broke up this weekend. I know everybody in the room is crushed about that.
“I’ve given up on the other two guys.”
The other two guys are the key figures in hockey’s drama, Commissioner Gary Bettman and NHLPA Executive Director Donald Fehr. They haven’t met formally since Sunday and don’t have anything scheduled. While they formulate their next moves, here’s a look at where the labor talks stand.
Q. Is money still the main problem?
A. Yes. The sides continue to fight about how to split revenues and, more importantly from the union’s side, how cash should flow to players in terms of their contracts.
Q. Can they split revenues 50-50?
A. That will be the end result, but it’s not mathematically possible to do immediately. The players received 57 percent of revenues in the last collective bargaining agreement, and the contracts in place prohibit going down to 50 percent unless salaries are trimmed.
The players, who had a 24 percent salary rollback following the 2004-05 lockout, are steadfastly against losing any money they were previously promised. The NHLPA, which has agreed to go to 50-50 by year three of any deal, reportedly told the league last week it won’t take less than the $1.88 billion share it earned last year, and it wants the number to rise 1.75 percent each year.
Q. Will the owners agree to that demand?
Not a chance. That number was 57 percent of a $3.3 billion pot. Since the revenue total will shrink because of canceled games, paying $1.88 billion to players this season would be even higher than 57 percent.
Q. What’s the owners’ alternative?
A. The league has devised a “make whole” provision. In its current form, any money players lose, up to $211 million, because of a shift to 50-50 would be repaid in subsequent years with 2 percent interest.
Q. Does the union like the “make whole” offer?
A. It estimates the $211 million the league promised is about $400 million short of what would really be needed to honor the contracts.
Q. Why is there disagreement over contract rights?
A. The NHL has proposed several changes to how and when players get new deals. The league’s offer would limit contract lengths to five years; restrict salary fluctuation from year-to-year to 5 percent to end the front-loaded deals that exposed a loophole in the salary cap; grant unrestricted free agency at age 28 or eight years of service, up from 27 and seven; and make entry-level contracts two years in length instead of three.
Q. Will the players agree to those demands?
A. It is highly unlikely. Fehr said last weekend that contracting rights have a higher priority than revenue share.
“We’ve told them that both are important,” Fehr said, “but as the share is limited, the player contracting rights become not only important but vastly more important.”
Q. What else are they arguing about?
A. New wrinkles in the talks developed over the weekend. The sides have been basing most of their numbers on last year’s revenue of $3.3 billion. Again, that total will shrink because of a shortened season and fan unrest.
Because the owners locked out the players, the union reportedly feels the shortfall should not come out of the players’ share of revenues. The league will no doubt rebuff that view.
Q. When will more games be canceled?
A. All games through November have been scratched. For games to begin Dec. 1, a deal will need to be reached by Nov. 23 because the league would like to conduct a seven-day training camp.
Q. Who will win the negotiation?
A. The owners will likely make fewer concessions, but because of the NHL’s tarnished brand, the answer continues to be: no one.
“If it keeps going like this everybody’s going to lose, there’s no way around it,” Pittsburgh captain Sidney Crosby told reporters Tuesday. “Everybody’s going to lose.”