Winnipeg Free Press - PRINT EDITION

Stuck on player salaries

Discrepancy on revenue sharing stalls negotiations

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TORONTO -- Next Tuesday's meeting between the NHL and the NHLPA could either be the last one for some time or the beginning of a bridge to a new deal.

This is pretty simple folks -- either the two sides begin to make headway on the issue of how much money should be allocated to player salaries or they don't.

The NHL has stated they can't move forward on the rest of a collective bargaining agreement until they solve what they believe to be the No. 1 issue in play right now.

"Well, we believe we're paying out more than we should be, it's as simple as that," said NHL commissioner Gary Bettman on Thursday, following a meeting between the league's negotiating committee and members of the players' union including executive director Don Fehr.

Bettman made it clear when next the two sides meet his focus will be on the players' share of revenue and how to reduce it to provide financial relief the league says it needs.

"It's clear that we're at a point that it's going to be very difficult to move this process along until we deal with the fundamental economic issues... and certainly as it relates to the fundamental economic issue, we are far apart both in terms of magnitude and structure," said Bettman. "We agreed, Don and I, that we would meet next on Tuesday in a group of Don and Steve (Fehr) and Bill (Daly) and me to see if we can make some progress on dealing with the fundamental economic issue because I think there is an acknowledgment that at this point it would be quite difficult to move anything else along until we deal with that issue."

That's it. Beginning, middle and end. Solve the discrepancy between the two parties where revenue split is concerned or don't. If there's no progress on Tuesday it would be difficult to imagine the two sides sitting down on Wednesday just to have coffee and a danish and discuss the decorator's decisions on furniture in the league's boardroom.

The players have allowed there are economic issues that need to be resolved and have suggested a format whereby they would share less in future league-wide revenue growth to allow teams enduring financial duress to improve their bottom line.

The NHL has asked for the players to take an immediate 14 per cent reduction in their share of hockey related revenue, down to 43 per cent from 57 per cent.

The players' proposal, tied to a formula that requires league revenue to grow by at least seven per cent, represents a savings to the league of $97 million in Year 1 of a four-year pact. The owners' system provides for the players to take a $450-million cut in the opening year of a five-year deal.

It's no secret ownership's first offer was exactly that, a starting point or invitation to begin discussion on bargaining.

It's unclear at this point if the players' offer is a take-it-or-leave-it proposal because there's been no give and take on the subject.

"Essentially what (the owners) have said is the players in football and basketball took less," said Fehr. "We've reminded them that every sport has their own economics and asked them if the basketball players got a higher percentage would they be proposing a higher percentage and of course they said no. And, secondly we reminded them that the only sport which is stable is baseball. It has no cap. It has very extensive revenue sharing. And, it has zero labour-relations problems the last 16 years. In the cap sports they've had nothing but lockouts. That's not something they didn't know, of course, but you asked how they have justified and that's essentially what they've pointed to, plus some suggestions about how their economics are working out. We've listened to what they've had to say. That's why the players made the proposal that they did and we'll go from there."

There is all kinds of periphery talk at this point about systems and other issues such as second contracts and the age of free agency but for now it matters little.

Some franchises make a lot of money, some make a little or even lose a little depending on the year and a whole bunch of teams lose a lot. No one is arguing this point. The players have the right to audit 15 teams in the league each year. They know what the business looks like and they understand to a degree it's broken. That's why they've offered to help out.

The owners must also know they can't expect to just gouge from the players to solve their ills. But the two sides haven't been able to engage and begin to bargain. All they've done is make separate offers and then stand beside them. Can they get on the same page?

"I can't tell you that for certain because it takes two parties to negotiate," said Bettman. "I do think if you're asking from our perspective what it looks like, the players have done very well under this deal. The average salary has gone from $1.45 million to $2.45 million, and I think if given their druthers -- and they've said publicly -- they'd be happy to keep playing under this deal even while we negotiate. "While we were prepared to begin negotiating a year ago, the union said it wasn't ready until the end of June. So, you can't negotiate with yourself and my sense is that they prefer to keep things the way they are, and so that slows up the process."

Fehr's job is to get as much for his players as he can but he also needs to keep them playing for them to get paid.

"I'm not sure there is any employer that wouldn't like a salary reduction in what it pays people, including all of you with microphones and with cameras and including everybody that watches or listens to this broadcast or reads about it in the press," said Fehr. "Everybody understands that employers would like to pay less. That's not a surprise to anybody. It's disappointing sometimes, but it's not a surprise."

The players think they've offered up a solution and the owners don't believe the solution goes far enough. That's the disconnect. There will be a connection. There always is. But how long will it take?

The NHL isn't permanently shutting its doors and sooner or perhaps much later a resolution will be reached. It appears we're now about to find out how much blood needs to be spilled to get to that point.

gary.lawless@freepress.mb.ca Twitter: @garylawless

Republished from the Winnipeg Free Press print edition August 24, 2012 C1

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About Gary Lawless

Gary Lawless is the Free Press sports columnist and co-host of the Hustler and Lawless show on TSN 1290 Winnipeg and www.winnipegfreepress.com
Lawless began covering sports as a rookie reporter at The Chronicle-Journal in Thunder Bay after graduating from journalism school at Durham College in Ontario.
After a Grey Cup winning stint with the Toronto Argonauts in the communications department, Lawless returned to Thunder Bay as sports editor.
In 1999 he joined the Free Press and after working on the night sports desk moved back into the field where he covered pro hockey, baseball and football beats prior to being named columnist.

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