The NHLPA proposal by the numbers

The Globe and Mail

National Hockey League Players’ Association Executive Director Donald Fehr in New York, Friday, Nov. 9, 2012. (Richard Drew/AP)

The NHL asked its players to present a detailed proposal on Wednesday morning, and they certainly delivered.

The six-page document prepared by executive director Donald Fehr outlines seven key areas that could form the foundation for a new collective bargaining agreement: revenue sharing, pension plan, discipline, player contracting and system issues, players’ share, term of CBA and transition rules.

Story continues below ad

It is by far the NHLPA’s most detailed offer yet, and it moves the two sides within less than $200-million of each other.

Whether or not it can result in a shortened season starting in the near future remains to be seen.

The key details

The main thing to take away from what’s there is that the players have accepted a 50-50 share of revenues plus the “make whole” amount.

The make whole amount in this offer is $393-million in total, with $182-million of that payable in Year 1, $128-million in Year 2, $72-million in Year 3 and $11-million in Year 4.

There is no make whole for the fifth year of the deal as it will have been phased out.

To determine what percentage of revenues the players’ share would be in each year, I’ve used the NHL’s projected revenues of $2.9-billion in a lockout shortened season for this year, then a 2.5 per cent increase in 2013-14 and a 5 per cent increase in each season after that.

I consider these to be pretty conservative revenue projections given hockey-related revenue has grown at a rate of 7.2 per cent a season the past seven seasons.

All figures are in millions of U.S. dollars:

Season

HRR

Existing

contracts

Make whole

50% share

& make whole

Player

share (%)

2011/12

$3,303

 

 

$1,883

57.0%

 

 

 

 

 

 

2012/13

$2,900

$1,776

$182

$1,632

56.3%

2013/14

$3,386

$1,246

$128

$1,821

53.8%

2014/15

$3,555

$746

$72

$1,849

52.0%

2015/16

$3,733

$503

$11

$1,877

50.3%

2016/17

$3,919

$286

 

$1,960

50.0%

Total

$17,492

$4,557

$393

$9,139

52.2%



The NHL to this point has offered a straight 50-50 split as well as $211-million as part of the “make whole,” putting them that $182-million apart I mentioned above.

Overall, what the players have proposed would likely give them roughly a 52 per cent share over the life of the deal, which is probably a little too high for the league’s liking.

Splitting the difference to take them to $300-million in the make whole may ultimately be the final solution.

Other issues

Here things are trickier. The players rejected all of the league’s proposals on contracting rights except for attempting to eliminate “back-diving” contracts like the ones given out to Ilya Kovalchuk and Roberto Luongo in recent years.

The PA proposal there would only apply to new contracts that are nine years or longer and would involve penalizing a team against the cap if the player retires before the end of the deal.

The NHLPA also proposes a salary cap of no less than $67.25-million in any year and a floor and cap that will function as a 20 per cent range from the midpoint.

(The midpoint for a $67.25-million cap in this system would be roughly $56-million, with the floor at closer to 45-million. The previous system had a range of $16-million between the cap and floor, which caused issues for poorer clubs attempting to reach the floor.)

The fine print

One other sticking point may be this line from the proposal: “There are no guarantees or fixed targets, other than a requirement that, beginning with the second year of the Agreement, players’ share, expressed in dollars, may not fall below its value for the prior season.”

That type of safety measure wouldn’t likely come into effect unless overall revenues cratered, something we haven’t seen in the NHL in more than a decade. But it’s still likely to draw the ire of owners who want to guarantee the player share is as close to 50-50 as possible every season.

You can read the NHLPA’s full offer here.