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The NHL’s proposal demands an NHLPA bailout with nothing offered in return for player givebacks

In a world that doesn’t include Gary Bettman’s rhetoric, the concept of the NHL locking out its players eight years after canceling an entire season to achieve “cost certainty” should make no sense. In any business of, let’s say, performance venues where its 30 franchises’ labor costs were capped to a reasonable percentage of business-wide revenues, where those revenues had increased from $1.8 to $3.3 billion, and when a third of those franchises were raking in money to charge people to watch their product (with said admission fees’ prices determined on a market-by-market basis, with no tangible connections to performers’ wages), a third of those franchises were getting by and a third were in real trouble, the chairman of said business enterprise would logically find a better way to support the franchises that weren’t making money without handcuffing those who lead the enterprise in moneymaking.

Options would not be limited to relocation, contraction and, if the 30-team model was essential, reexamining how the business plan could be best tweaked to give the moneymaking franchises an incentive to stabilize their struggling brethren. Certainly, the performers would be asked to lend a hand, but under any reasonable business model, such requests would not base a revamping of each and every one of the 30 franchises’ business plans based solely upon a 24% reduction in labor costs.

Clearly, such a “bailout” would serve as a temporary band-aid, but if the business-owners’ proposal to their performers explicitly stated that little would change in terms of systemic issues save a reduction in labor’s wages, one would assume that the performers would very reasonably dismiss such an agreement out of hand, pointing out that, over the long term, the parties would be revisiting the exact same problems regarding struggling franchise stability five or eight or ten years down the line.

Should that proposal also clamp strict restrictions upon performers’ rights, mobility and individual abilities to earn raises, both the performers and the people who paid to watch them would probably laugh at the business owners’ suggestion that their proposal was based in something other than fantasy land. If the business as a whole was not in danger of insolvency, such a “bailout”-based business plan would make no sense.

Should the performers come back with a similar proposal that offered a temporary “bailout,” and that proposal be not only dismissed out of hand but also answered with, “We will not hold performances until said performers agree to reduce their labor costs, because that is the problem with our business and that is the problem facing both the franchises which make huge profits charging admission and those who cannot get by,” the performers and general public would likely wonder what planet the business’s CEO was living on.

But this is the NHL we’re talking about, and Gary Bettman and the Board of Governors who are suggesting that their industry’s weakest franchises are in such dire straits that the entire league demands a substantial reduction in labor costs—but almost no other changes to its business model, other than to redetermine which revenues were subject to divvying up with labor. And Bettman and the Board expect to be taken as something other than people who may be in need of psychological care.

As the New York Post’s Larry Brooks suggests, the fact that the NHL’s demand for a bailout-based set of givebacks and restrictions upon player mobility also offers no tangible benefits for the players currently playing as part of the process makes the NHL’s stance nothing less than that of a band of lunatics led by a madman:

In the matter of false equivalencies, there is Gary Bettman’s reference to NFL and NBA players accepting reduced percentages of revenue following lockouts imposed by their respective leagues. It is true pro basketball and pro football players ultimately agreed to take a smaller piece of their pies, yet the cap remained unchanged in the NBA following that league’s lockout while the cap in the NFL was initially reduced by less than six percent.

Neither the NBA nor NFL demanded its athletes submit to rollbacks of existing contracts, a tactic embraced by NHL owners who apparently regard currency in long-term contracts as equivalent to confederate money.

Moreover, neither the NBA nor NFL gained concessions on systemic issues such as free agency out of their lockouts. NBA players won on the issue of escrow. NFL players gained $1 billion of additional benefits for retired players while also bargaining for increased takes of future national media revenue.

The football and basketball negotiations have as much or as little relevancy to hockey’s bargaining as does Major League Baseball’s current CBA.

But if Bettman insists on citing the NFL and NBA in an attempt to bolster his own league’s position, he might at least want to do so in a more comprehensive, and I dare say, more honest manner.

Brooks continues with Rangers-related notes, he states that Lubomir Visnovsky’s grievance regarding his trade from the Anaheim Ducks to the New York Islanders without consulting a player with a no-trade clause will be heard on September 4th, and he adds one astute point about the NHLPA’s “Let’s Cap Everything” proposal:

The NHLPA makes a valid point that non-player spending, which fluctuates wildly within the league, can be as determinative in performance as payroll, and thus the proposal to cap those expenses as well.

But it is certainly not in the union’s best interests to limit those expenditures that would include travel, as well as salaries for coaches and general managers. Does the PA want teams to return to flying commercial airlines rather than charter? In that case, the “no middle seat” clause could become more valuable than the no-trade clause.

We’d have to know more about the means by which expense X is capped but expense X is capped while insuring that players receive quality Y of service (example: teams could only pay X to Y group of charter aircraft companies and/or X in fuel costs and flight time on their private planes, as opposed to X amount of dollars on air travel by any means for transportation), but the players haven’t immediately posted the guts of their proposals on the web this time around.

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Comments

joedaiceman's avatar

The smaller markets can not be successful under the current structure. That is the reality. The players will pout and shout but it doesn’t matter. It has to be fixed and as much as I hate Buttman, he is on the right side of the argument and the players have to succumb or else we have another delayed or possibly cancelled season. If you want a healthy league, you need the smaller markets to be able to succeed. All the owner bashing is nothing more than fools pontificating on things they do not understand.

Posted by joedaiceman on 08/19/12 at 09:27 PM ET

bezukov's avatar

Posted by joedaiceman on 08/19/12 at 08:27 PM ET

Why should the players have to pay for ownership’s mistakes?  Failed franchises (also known as bad investments)  and over expansion weren’t the players fault.  Despite that, the NHL is more profitable than ever.  There is no reason (except greed) that is keeping the owners from getting their own affairs straight.  Shame on them for demanding that the players make up for the league’s incompetence.

Posted by bezukov from the kids are alright. on 08/19/12 at 10:58 PM ET

Avatar

Any article that cites the uninformed rantings of Larry Brooks has profound problems in being treated as a serious piece of work.

I would suggest that the writer may want to familiarize himself with collective bargaining - both with respect to sports and other industries (HINT: employees in many industries are often forced to swallow hefty wage reductions) - before following up on this effort.

Posted by Gerald on 08/21/12 at 06:43 PM ET

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Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.

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