NHL offers 50/50 split in revenue, no rollback in order to preserve 82-game season
The National Hockey League issued a new proposal to its players on Tuesday that significantly pushed the sides toward a potential resolution of the lockout: a 50/50 split on hockey-related revenue — as it's currently defined — without a traditional salary rollback, in an effort to preserve an 82-game 2012-13 season beginning on Nov. 2.
An even more significant part of this proposal, which the NHLPA later revealed was in the neighborhood of six years: The preservation of player salaries in the initial years of the deal, according to Pierre LeBrun of ESPN. It's been one the of the NHLPA's most consistent demands: The owners honor the value of the contracts they handed out.
NHLPA chief Donald Fehr will take the offer back to his negotiating committee. But the devil's in the details.
There's a now-familiar vocabulary in the National Hockey League's collective bargaining talks. Words like "escrow" and "hockey-related revenue." We know what they mean, but not always how they're defined. Here's another one for that glossary: "rollback."
The NHL's initial proposal to the NHLPA last summer was like a parody of what one should look like, and it included a 24 percent rollback on existing contracts. The subsequent proposals, including one submitted by the NHL on Tuesday during their talks in Toronto, haven't.
But that doesn't mean there isn't a salary reduction, as Darren Dreger notes:
Need to see provision for year 1 salary protection. Initial player response: 1% increase. Still a 12-13% reduction in yr 1 (7/57= 12.2%).
— Darren Dreger (@DarrenDreger) October 16, 2012
The NHL has been aiming for a 50/50 split for months. It's where it was willing to arrive. In the Luntz Global fan surveys leaked by Deadspin, a 50/50 split "like in other sports leagues" was explicitly mentioned.
As far as preserving salaries, Elliotte Friedman of CBC has a theory and it's consistent with what we've heard about the NHL's plans:
I'd expect the key thing for players to discuss is what sounds like an NHL offer to "return" whatever is lost on their salaries this season. My guess: league has said if you have a long-term contract and you lose xx% this year, we will find a way to "return" it over term. What that means for players on a shorter deal, I don't know. But, my sense is NHL has at least made a proposal that should get things moving.
The great John Shannon of Sportsnet had some of the other details:
• Entry level contract maximums will go from three years to four years; i.e. every star rookie will be locked into a 4-year contract before their payday.
[Ed. N0te: Shannon later said it'll remain at a three-year cap.]
• The cap on long-term contracts will be five years. No more lifetime, cap-circumventing deals; no more securing your investments for a decade. But hey, at least the free-agent frenzy will be fun again.
• "Revenue sharing would be at or near 200 million dollars." Closer to what the NHLPA desired, and presumably expanded to teams like the Devils and Ducks.
• Free agency would "be at 28 years old and 8 years of NHL service."
• "Players' Salaries for those NHLers playing in the AHL would be part of the cap." Now, are they formally calling this the Wade Redden Rule or not ...
Again, that's if the NHLPA takes the 50/50 split.
The bottom line is that we can feel a twinge of optimism here. The NHL went to 50/50, and tossed out many of the poison pills from previous offers. Donald Fehr didn't reject it. This is progress.
UPDATE: Via the NHL, here are Gary Bettman's comments from Tuesday:
Good afternoon, everyone. Bill Daly and I just spent the last hour with Don and Steve Fehr, and I would like to briefly report to you on what was discussed. As I think all of you know we have been extremely disappointed, and that's an understatement, that we've been unable to get these negotiations on the essential elements moving forward. So, today, we began by discussing with Don and Steve that if we were to drop the puck on November 2nd for the start of the regular season, we could preserve an 82-game schedule for the regular season and play full playoffs as we normally do and be done before the end of June.
We very much want to preserve a full 82-game season, and in that light, we made a proposal, an offer, really that is our best shot at preserving an 82-game regular season and playoffs, and this offer that we made obviously was contingent upon having an 82-game regular season.
A lot of you know we don't negotiate publicly, and I'm not going to break that habit because I don't think it's constructive. The fact of the matter is, we offered a 50-50 share of HRR, hockey related revenues, and we believe we addressed the concern that players have about what happens to their salaries as a result in this year of reducing the percentage from 57 to 50%.
Beyond that, I don't want to get into the substance other than to say we believe that this was a fair offer for a long-term deal, and it's one that we hope gets a positive reaction so that we can drop the puck on November 2nd -- which backing up, entails at least a one-week training camp. So we have about nine or ten days to get this all put to bed, signed, sealed and delivered, in order for this offer to be effective and for us to move forward.
We hope that this effort that we've undertaken today would be successful because we know how difficult this all has been for everybody associated with the game, particularly our fans.
Q. How confident are you that this is going to go forward?
Well, we certainly hope it will. We've given it our best shot.
What was the reaction?
The reaction was that they obviously need to study it, and so we told them that we're available to them. But they're going to need some time to review it, and I respect that portion of the process. Obviously, they've got to understand the offer and get comfortable with it.
Was it just the core economic issues in terms of the offer?
We had a number of significant elements that we believe can and should serve as the basis of a deal to get us playing hockey.
Why do this today?
Because if we want to have an 82-game regular season, if we want to preserve an 82-game regular season and you back up the timetable in terms of the schedule, we needed to do it.
By the way, in terms of the schedule, so everybody understands, the compression that would be involved is one additional game every five weeks. Beyond that, we don't think it would be good for the players or for the game. But if you look at what our ability would be to schedule 82 games and you work back from November 2nd, if we didn't do it now, if we didn't put an effort on the table that we thought was fair and could get us playing hockey, if we didn't do it now, then it probably wasn't going to happen for a while. Because, again, it's done in the spirit of getting a full season in.
Is it 50-50 across the board?
It's 50-50 across board.
How long of a contract will this be?
I'm not going to get into the specifics. We proposed a long-term contract. We think that's in everybody's interest. We think that's what our fans want.
Can you explain how you address the roll back or the escrow?
There is no roll back, and I'm not going to get into the specifics. It would not be constructive at this point in time. The union has some work to do, and we respect the process. I probably have gone further than I usually have in terms of discussing what we've proposed than at any other time. But I'm not comfortable going any further. I'm more concerned about the process right now and getting us back on the ice.
How worried are you they might say no and more of the season will be lost?
I don't even want to go there.
Is the league amenable to playing an abbreviated schedule?
We're focused on getting the puck dropped on November 2nd and playing a full 82-game regular season and full playoffs. That's what this offer is all about.
Have you made plans to meet later in the week?
We're going to be on-call to them. They have some work to internally. Obviously, we didn't put this proposal, this offer, together overnight, and they're going to need a little time to review it. I'm hoping that review will get us to a positive and constructive place.
This may have been the first officially released Bettman transcript since the Stanley Cup Final.
And here's Fehr speaking to the media about the proposal: