CBA - What the owners want

[Tom_Benjamin]

Well they could offer one-way $250-500K with $100K signing bonuses contracts to every NHL player and a bunch of AHLers. The ex-NHLPA players would choose not to accept those offers out of pride. The unaligned AHLers would jump on them. When enough new-NHLers get together they form a union. If the Naslund signs for $500K the owners are laughing, if he chooses not to sign that is his choice.

If you want to believe in this Fantasy Island garbage, feel free. It's illegal. The NHL cuts a deal with the NHLPA or the players decertify and the NHL has to operate like 30 separate businesses and the players can work for any of the businesses they want.

If you want to learn something about the topic, google "sports and anti-trust".

Tom

 

[David A. Rainer]

If you want to believe in this Fantasy Island garbage, feel free. It's illegal. The NHL cuts a deal with the NHLPA or the players decertify and the NHL has to operate like 30 separate businesses and the players can work for any of the businesses they want.

Well, let me chime in here. If the negotiations hit what is called "impasse" - neither side is willing to budge on their demands and negotiations cease - the NHL has the right to implement what is called "last / best". A "last / best" is the last or best offer made to the players' union. The NHL can unilaterally implement this last or best CBA and begin to hire replacement players.

What you were referring too (and correctly, I might add) is that the NHL cannot just implement their own restrictions in a currently active CBA, nor their own restrictions on competition without a CBA - these two circumstances require collective bargaining. But when a business is in between CBAs and negotiations with the certified union break down, the business is allowed to implement their own CBA - but this is ONLY if there is an impasse. Basically, it is saying that the business is trying, in good faith, to collectively bargain but labor will not listen, so the business is permitted to unilaterally take the next step in hopes of bringing the certified union back to the negotiating table.

So, if we reach impasse, the NHL can kick out the players, implement their own CBA (with the $31M salary cap) and hire new replacement players. It's just another aspect of labor law that will circumvent the restrictions of anti-trust law.

 

[Tom_Benjamin]

So, if we reach impasse, the NHL can kick out the players, implement their own CBA (with the $31M salary cap) and hire new replacement players. It's just another aspect of labor law that will circumvent the restrictions of anti-trust law.

When the impasse is reached the NHLPA decertifies. At that point I don't think labour law applies at all.

Tom

 

[David A. Rainer]

When the impasse is reached the NHLPA decertifies. At that point I don't think labour law applies at all.

Tom

Remember, the CBA has expired, but it has not terminated (which doesn't mean much except for some tight legal maneuverings ). Labor law will continue to govern this process.

When an impasse is declared, the players go on strike, the owners implement their "last / best" and hire new employees under the "last / best". These new employees are the newly certified union for the NHL players under this new "last / best" CBA. It is tantamount to a transfer in power, from one CBA to another. And since it is one CBA to another, labor law will continue to govern this process and is in fact stipulated in the NLRA. It gets even more interesting when the players want to go back to the bargainning table while replacement players are employed (issues about who which union will take over, which players are eligible to continue to play, etc)

This whole process is kind of convoluted and does not seem consistent at times, but that is because the law makers were trying to balance a lot of competing considerations on both sides and trying to balance leverage granted on one side with leverage granted to the other side. But trust me, there is a process in there somewhere.

 

[I in the Eye]

The owners can't do it because they are supposed to be 30 competing businesses who are supposed to compete for labour. They can't have a salary cap - unless the players agree - because it is an illegal restraint of trade.

bull****... The NHL is not a market or an industry... The NHL is a franchisee that operates in the professional hockey industry... The franchises operate under the franchisee... Nothing 'legal' says that the individual franchises should be competing for labour (other than the current CBA)... All the franchises belong and operate under the same company!!!

It's legal in a business, you know, for the owners of that business to dictate what the employee salaries will be... The NHL can have the harshest of salary caps - and the lowest of wages - as long as they meet the minimum requirements and employee benefits of the law... Minimum wage... If the employee doesn't like the salary, they can move on to another company... In this case, if the player doesn't like what the 'NHL defined' salary is, the player is free to play in the AHL, Europe, etc...

 

[capman29]

I found it finally by searching for the page on Google. I don't get why a cap wouldn't work? Just make the cap so it can't be circumvented. The salaries - no matter how they are paid - cannot exceed $31 million. Each team must report all of it's spending to the league at the end of the year. Any player paid over the cap - no matter how - will cause the team to be fined. Or the teams assign a player a percentage of the revenue. Or use a points system. That's the best way to do it. Then the league knows exactly what is spent on each player. Each signing when it occurs is reported to the league.

The NFL and NBA are overpaying, and it's well known. That's fine. So the NBA and NFL heads should be penalizing the teams that are doing it.

How can you make a cap uncircumventable when there will NEVER BE ONE ???? sECOUNDLY even if you have a cap a third party laase would get by all caps because the league could not stop leasing players from a third party. Next personal service agreement would also not be covered because it not for playing hockey.For every road block you put up they all can be defeated bcause you cannot see all avenues to pay players. oget the cap will not work and will not happen/Owners must bargain to get cost reduction from the players or they wont get i.

 

[David A. Rainer]

bull****... The NHL is not a market or an industry... The NHL is a franchisee that operates in the professional hockey industry... The franchises operate under the franchisee... Nothing 'legal' says that the individual franchises should be competing for labour (other than the current CBA)... All the franchises belong and operate under the same company!!!

It's legal in a business, you know, for the owners of that business to dictate what the employee salaries will be... The NHL can have the harshest of salary caps - and the lowest of wages - as long as they meet the minimum requirements and employee benefits of the law... Minimum wage... If the employee doesn't like the salary, they can move on to another company... In this case, if the player doesn't like what the 'NHL defined' salary is, the player is free to play in the AHL, Europe, etc...

You are correct in that the NHL is set-up as a franchise. However, it is illegal for the franchisor (and it is francisor, not franchisee) to dictate the salary paid to the employees of the various franchisees. They might be operating under a single NHL company, but they are most certainly NOT all the same company.The NHL (being the franchisor) cannot dictate to the member teams (being franchisees) the salary they will pay their players. It is a violation of anti-trust law whether you are the NHL or McDonalds.

Your statement that "if a player doesn't like what the 'NHL defined' salary is, the player is free to play in the AHL, Europe, etc..." is very much illegal (unless purified thru the collective bargaining process) because each team (as a franchisee) is a separate legal entity, of which any combination (grouping together to mandate a single specific wage) to supress competition (in this case the labor market) is a violation of the Sherman Act.

Sure, it might be nice to do that, but not under the current laws you can't. To do what you are suggesting, each individual team would have to divest itself and form back together as a single corporation (let's call it "NHL Corp") where the owners each hold shares in NHL Corp. Then NHL Corp can dictate it's wages. But until that happens, no can do.

 

[degroat*]

How can you make a cap uncircumventable when there will NEVER BE ONE ???? sECOUNDLY even if you have a cap a third party laase would get by all caps because the league could not stop leasing players from a third party. Next personal service agreement would also not be covered because it not for playing hockey.For every road block you put up they all can be defeated bcause you cannot see all avenues to pay players. oget the cap will not work and will not happen/Owners must bargain to get cost reduction from the players or they wont get i.

You are so incredibly wrong about this nonsense about leasing players that I'd just like to thank you for the good laugh.

The NFL has a foolproof cap. This is a FACT. None of these fantasy stories you have made up have effected the NFL's cap so why in the hell should we believe this nonsense you are spewing?

 

[Tom_Benjamin]

bull****... The NHL is not a market or an industry... The NHL is a franchisee that operates in the professional hockey industry... The franchises operate under the franchisee... Nothing 'legal' says that the individual franchises should be competing for labour (other than the current CBA)... All the franchises belong and operate under the same company!!!

They are not. Anti-trust law says this. The NHL is not a company. The individual teams are companies. They could be organized this way, but they are not, and are very unlikely to adopt the model. It would have the NHL negotiating and paying all contracts as well as collecting all revenue.

I don't want to disuss this with you unless you are prepared to do the work. Read the case law and get a basic understanding as to how anti-trust legislation and labour legislation work together. They often conflict. The courts have declared very clearly that labour trumps anti-trust if there is a valid CBA, expired or not, that was freely negotiated between employees and employers. Otherwise, anti-trust legislation prevails.

Deathfromabove is correct in his post above as near as I can tell. If the NHL can declare an impasse - not exactly easy - they can effectively convert the lockout to a strike. Once at that point, they can try to get players to cross the line in the United States. There are jurisdictions - Quebec and BC, I think - where that is not legal. If it gets that far it will be interesting to see what happens.

If the Union decertifies, it becomes moot. I think the union will decertify as soon as the season is cancelled and several players will get ready to file collusion lawsuits. That was the baseball player's ultimate threat and it is the ultimate threat for hockey players too.

Tom

 

[me2]

If the Union decertifies, it becomes moot. I think the union will decertify as soon as the season is cancelled and several players will get ready to file collusion lawsuits. That was the baseball player's ultimate threat and it is the ultimate threat for hockey players too.

Tom

I think that then comes down to forming a new union with NHL players willing rejoin and AHLers will to give major league hockey a go. If the NHLPA deregisters it leaves itself open to being replaced and redendered redundant. Once its gone, its gone.

 

[me2]

You are correct in that the NHL is set-up as a franchise. However, it is illegal for the franchisor (and it is francisor, not franchisee) to dictate the salary paid to the employees of the various franchisees. The NHL (being the franchisor) cannot dictate to the member teams (being franchisees) the salary they will pay their players. It is a violation of anti-trust law whether you are the NHL or McDonalds.

Post lockout-CBA disolving-NLPHA disolving. Would these be legal

1) Franchisor to require the franchisees to meet criteria to enter a competition (payroll under $40m)? McDonalds might have criteria that certain uniforms must be met, certain signage. The teams can sign as many players as they like, for as much as they want to spend on them. That seems like a reasonable thing for a franchisor-franchisee relationship.

2) same as above except that if the spend too much they get put into a different comp.

3) teams hiring hockey players from a 3rd party labour company. Teams pay an amount to this company, say $31m, which them agrees to provide them with some hockey talent. The same way one might rent auditors or accountants from KPMG.

 

[David A. Rainer]

Post lockout-CBA disolving-NLPHA disolving. Would these be legal

1) Franchisor to require the franchisees to meet criteria to enter a competition (payroll under $40m)? McDonalds might have criteria that certain uniforms must be met, certain signage. The teams can sign as many players as they like, for as much as they want to spend on them. That seems like a reasonable thing for a franchisor-franchisee relationship.

2) same as above except that if the spend too much they get put into a different comp.

3) teams hiring hockey players from a 3rd party labour company. Teams pay an amount to this company, say $31m, which them agrees to provide them with some hockey talent. The same way one might rent auditors or accountants from KPMG.

Uniforms? Yes. Signage? Yes. Wages? An emphatic NO. Uniforms and signage do not affect competition, in this case competition in the labor market, so a franchisor can stipulate this all it wants in the franchise agreement. Stipulating a given wage in the franchise agreement reduces the level of competition in the labor market (basically, when every franchise offers the same wage, or offers a wage up to a certain level, the competition in the labor market is reduced because there is an artificial restriction on the wages). This is absolutely and without a doubt a violation of the Sherman Anti-trust Act. You and I can think of all kinds of different ways of forming agreements to provide a single mandated wage to the players, but every agreement you can think of, as long as it is done without a CBA and involved multiple legal entities is without a doubt going to be illegal under the Sherman Act.

Providing guidelines for the use of uniforms and signs might seem no different than providing guidelines for the payment of wages, but legally, it most certainly is different.

 

[me2]

Uniforms? Yes. Signage? Yes. Wages? An emphatic NO. Uniforms and signage do not affect competition, in this case competition in the labor market, so a franchisor can stipulate this all it wants in the franchise agreement. Stipulating a given wage in the franchise agreement reduces the level of competition in the labor market (basically, when every franchise offers the same wage, or offers a wage up to a certain level, the competition in the labor market is reduced because there is an artificial restriction on the wages). This is absolutely and without a doubt a violation of the Sherman Anti-trust Act. You and I can think of all kinds of different ways of forming agreements to provide a single mandated wage to the players, but every agreement you can think of, as long as it is done without a CBA and involved multiple legal entities is without a doubt going to be illegal under the Sherman Act.

Providing guidelines for the use of uniforms and signs might seem no different than providing guidelines for the payment of wages, but legally, it most certainly is different.

I'm saying the teams have full control over how much they want to pay to whoever they want to pay. The franchisor takes no part in salary negotiations, sets no levels individual salaries. Those things are entirely up to the players and teams to work out. Let the teams fight each other for players. Lets teams spend as much as they want. However teams must the criteria to enter the Stanley Cup, that being a total salary lower than X. Above X, the teams can do what they like, arrange the own comp, enter a new NHL Megabucks comp etc.

For example company could run a racing car circuit where teams were only allowed to spend $1m/y.

 

[SuperUnknown]

It has been argued out by good lawyers and the case law is very clear. The owners can't do it because they are supposed to be 30 competing businesses who are supposed to compete for labour. They can't have a salary cap - unless the players agree - because it is an illegal restraint of trade.

That's not totally true. The NHL entity could specify that to play in their league, a team can't have a payroll higher than "x". Then members of the NHL (the teams), have to sign a contract with the NHL that they will keep their payroll under "x". The ones that don't agree can always start their own leagues or something else. Of course, they would probably have to reform, but the NHL could have rules for owners wishing to join their league.

About the other things that you're saying, I don't think they hold much truth. There are new leagues forming all the time with rules such as a salary cap before even putting one player under contract (ie:WHA).

P.S.: Also, as far as anti trust laws are concerned, it could be argued that the labor market competition is international, proven by the fact a lot of NHLers got contracts around the world for nice amount of money. The same can't be said for Baseball, (american) Football and Basketball, where there aren't any league around the world of the same caliber, mostly because those are american sports. Also, I can't see why a contract clause between the NHL and the teams stating something like "The teams that play in the NHL, for competitivity reasons, must not spend more than x on player salaries. If a team wishes to increase their payroll over x, they can freely disassociate from the league to pursue their own venture". Besides, it's not like they won't negociate a new CBA pretty soon after re-starting".

 

[I in the Eye]

You are correct in that the NHL is set-up as a franchise. However, it is illegal for the franchisor (and it is francisor, not franchisee) to dictate the salary paid to the employees of the various franchisees.

One of them is called a franchisee... I remember that...

The NHL (being the franchisor) cannot dictate to the member teams (being franchisees) the salary they will pay their players. It is a violation of anti-trust law whether you are the NHL or McDonalds.

So, are you saying that McDonald's does not dictate the costs associated with their products to the franchisees (I assume that this is the proper use of the word)? Are you saying that the individual franchisees have different product-related costs? Are you saying that a franchise owner can pay his son (a burger flipper) 3 times more than his burger flipping peers?

I was always under the impression that expenses in a franchise-based business were standardized (for resource expenses directly related to the product - including employee salaries for those who help develop/deliver the product)... I was always under the impression that McDonald's kept ultra-strict control over their products - and product-related costs... I always assumed that burger flippers all got paid the same - regardless of the franchise (as dictated from head office)... Hmm... go figure... Learn something new every day

My underlining thinking was that in the NHL franchise business, the players are an important ingredient of the product... IMO, the players are like the burger patties in a Big Mac (speaking figuratively)... I assume that McDonald's head office controls the costs for burger patties (to maintain price for big macs regardless of franchise (I assumed that McDonald's directs and controls all decisions that directly relate to the image of the brand)... Obviously, the players have to be treated far better than a piece of meat... But I didn't realize it was illegal for the franchisor to control the salaries of the franchisee's employees...

Sure, it might be nice to do that, but not under the current laws you can't. To do what you are suggesting, each individual team would have to divest itself and form back together as a single corporation (let's call it "NHL Corp") where the owners each hold shares in NHL Corp. Then NHL Corp can dictate it's wages. But until that happens, no can do.

Interesting...

 

[thinkwild]

So, are you saying that McDonald's does not dictate the costs associated with their products to the franchisees (I assume that this is the proper use of the word)? Are you saying that the individual franchisees have different product-related costs?

I think he was suggesting that they cant dictate the wages, not the product costs. THe minimum wage is different in many of the places Mcdonalds is located in, and their wages would likely be in line with local norms.

I think the better analogy for hockey players is the 700 best lawyers or 700 best CEOs, rather than Macdonalds franchises. Sports is so different, we always tread a difficult line when trying to make comparisons with other industries

 

[thinkwild]

I'm saying the teams have full control over how much they want to pay to whoever they want to pay.

Exactly

However teams must the criteria to enter the Stanley Cup, that being a total salary lower than X. Above X, the teams can do what they like, arrange the own comp, enter a new NHL Megabucks comp etc.

How can they have full control over how much they wnat to pay and for who if there is a cap. What is the reason you would a small market team like Tampa Bay to play in another league from Detroit and the like. Is is because it would be embarassing to lose to them with a lower payroll?

 

[David A. Rainer]

I'm saying the teams have full control over how much they want to pay to whoever they want to pay. The franchisor takes no part in salary negotiations, sets no levels individual salaries. Those things are entirely up to the players and teams to work out. Let the teams fight each other for players. Lets teams spend as much as they want. However teams must the criteria to enter the Stanley Cup, that being a total salary lower than X. Above X, the teams can do what they like, arrange the own comp, enter a new NHL Megabucks comp etc.

For example company could run a racing car circuit where teams were only allowed to spend $1m/y.

So let me get this straight... Each team is allowed to spend however they want, but only those teams that spend under a certain amount of money can play in the NHL (or if in the NHL, not the playoffs)?

This would still be a very easy case for any federal judge. As the point of playing in the NHL is to go to and play in the Stanley Cup, putting a disincentive for a team to spend money by placing a restriction on entry into the playoffs is still a group boycott, an illegal combination to suppress wages, and a violation of the Sherman Act.

At the very base of it, any time any one or any thing places a restriction that involves (i.) the suppression of wages; and (ii.) two or more legally separate entities, there will definitely be a violation. As this is a restriction to (i.) suppress wages (cap at X) and (ii.) being carried out by more than one entity (the member franchises), it is a violation.

In your racing circuit example, if it is only a single company involved, then there is no problem. If it is a league restriction that is imposed on the member companies, the court would ask if there is an affect on competition. A driver would presumably argue that it is suppressing my wages, and therefore affecting competition in the labor market. The league is then in violation of the Sherman Act UNLESS it goes thru the collective bargaining process and then just about any reasonable restriction is OK.

 

[David A. Rainer]

One of them is called a franchisee... I remember that...

No sweat. it took a very expensive education to get it straight for me. hehehehehe

So, are you saying that McDonald's does not dictate the costs associated with their products to the franchisees (I assume that this is the proper use of the word)? Are you saying that the individual franchisees have different product-related costs? Are you saying that a franchise owner can pay his son (a burger flipper) 3 times more than his burger flipping peers?

No, McDonalds cannot dictate the costs to its member franchises. It can suggest them (as in a manufacturer's suggested retail price). That's why every time you hear a commercial, it says "prices may vary". Because if they did not, the feds would be all over them for anti-trust violations resulting from price fixing. Mandating the price to all its franchisees is price fixing. The benefit of being a frachisee is not necessarily price certainty as it is free advertising, the use of a recognized logo, and inexpensive supplies - but NOT fixed prices.

I was always under the impression that expenses in a franchise-based business were standardized (for resource expenses directly related to the product - including employee salaries for those who help develop/deliver the product)... I was always under the impression that McDonald's kept ultra-strict control over their products - and product-related costs... I always assumed that burger flippers all got paid the same - regardless of the franchise (as dictated from head office)... Hmm... go figure... Learn something new every day

The price is standardized to some degree. The franchisor can sell their produce for a single price they determine (just like any single business selling widgets for a price they determine). And this provides cost certainty to the franchisee. But the franchisor cannot dictate to the franchisee the amount that the franchisee will re-sell the product to their customers for. That is left to supply and demand and if they tried to dictate, it is called price fixing. Often, the prices are very similar (or even the same), but that is becuase the supply and demand does not vary the price of burgers that much. But if they were dictated by the franchisor, it would be price fixing.

My underlining thinking was that in the NHL franchise business, the players are an important ingredient of the product... IMO, the players are like the burger patties in a Big Mac (speaking figuratively)... I assume that McDonald's head office controls the costs for burger patties (to maintain price for big macs regardless of franchise (I assumed that McDonald's directs and controls all decisions that directly relate to the image of the brand)... Obviously, the players have to be treated far better than a piece of meat... But I didn't realize it was illegal for the franchisor to control the salaries of the franchisee's employees...

Interesting...

Yep, it is illegal unless they pass the restriction through the collective bargaining process. That is what this whole mess is about. You can go to any of your local burger franchises and ask the manager if the franchisor (McDonalds Corp, etc) sets the wages or the individual owner of the particular store sets the wages. It will be the individual owner. The owners want to add some restrictions to suppress wages and they cannot do it unilaterally. They must collectively bargain for it. If it is included in a CBA, the restriction is perfectly fine.

I hope this is making sense.

 

[David A. Rainer]

Also, I can't see why a contract clause between the NHL and the teams stating something like "The teams that play in the NHL, for competitivity reasons, must not spend more than x on player salaries. If a team wishes to increase their payroll over x, they can freely disassociate from the league to pursue their own venture". Besides, it's not like they won't negociate a new CBA pretty soon after re-starting".

Because irregardless of whether they can always go and form their own league, this particular league is creating a combination of at least two or more separate entites that has a restriction in place that suppresses competition in the labor market. That is all it takes. It is a black and white example of a violation of the Act. It is called price fixing and an industry does not need a monopoly on something (that is, lack of freedom of creating their own league) to be guilty of price fixing.

Just for reference sake, let me give §1 of the Sherman Act: "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal." (emphasis added)

EVERY

A restricton on salaries has long since been determined to be a restraint on trade in the labor market and a violation of §1. And the restriction does not need to be a complete restriction (that is, wholly barring someone from participating), it need only be some sort of restriction - EVEN the tiniest of restrictions (although tiny restrictions are technically a violation, they can often be balanced with other considerations to uphold it). This is not new stuff. These cases have long since been decided about 100 years ago and are being upheld on a daily basis.

 

[Tom_Benjamin]

That's not totally true. The NHL entity could specify that to play in their league, a team can't have a payroll higher than "x". Then members of the NHL (the teams), have to sign a contract with the NHL that they will keep their payroll under "x". The ones that don't agree can always start their own leagues or something else. Of course, they would probably have to reform, but the NHL could have rules for owners wishing to join their league.

It is totally true. The NHL entity cannot specify this. If they could specify it, don't you think the NHL would have already done it? They must get the agreement of their employees or it is illegal.

Half the hare brained schemes suggested on these boards for forcing the players back to work at a lower wage are illegal. It is very easy to argue that the only really good rationale for a player's union these days is competitive balance. The players aren't like welders or machinists. They negotiate their own contracts. What does the union do for them? It allows the league to work legally with rules to prevent all the best players ending up in New York or Toronto.

Some people seem to think that the existing CBA is structured so the players would get more than they would get in a completely open market. It is hard to tell whether this is true or not. I doubt it, but maybe. I'm sure they would get more in a completely open market than they will in a "salary cap at $31 million" world.

If the players decide to chuck the union at some point during this dispute, NHL teams won't be able to do anything at all to suppress wages. They will not be able to hold an entry draft. No entry level salary system. No restricted free agents. No compensation for lost UFA's. They will not hold the rights to any player beyond the term of each contract.

The NHL needs the union more than the players do.

Tom

 

[degroat*]

Smail - It's called collusion. It's illegal and doing what your suggesting would result in owners getting sued for a ton of money.

 

[I in the Eye]

I hope this is making sense.

I think it is ... Thanks for the great insight and info... It is very much appreciated...

Could the NHL provide the individual teams with 'suggested player values' (regardless of what economic system is agreed to in the CBA)?

That way, even in a 'free market system', the individual team GM's (and owners) have a 'suggested' benchmark when negotiating contracts with player agents- based on what the NHL and the team's peers value the player to be worth... i.e. interpretation of 'player value' no longer becomes just an individual GM/team decision - but the GM/team is armed with the knowledge of what the NHL and the other teams think the player is worth as well...

And this is independent to what the player actually earns... It's what the NHL and the owners (as a group) think the player should earn...

Even if the Rangers pay Holik $9 million, the Rangers (and the rest of the teams) know that the NHL and the other teams value Holik to be $3.5 million, for example. Next season, if Holik plays terrible, the NHL and the owners 'suggested player value' for Holik goes down to $2 million - even though he is still being paid $9 million...

Is this legal?

 

[Tom_Benjamin]

Could the NHL provide the individual teams with 'suggested player values' (regardless of what economic system is agreed to in the CBA)?

The NHL can't do anything to suppress wages without the union's blessing. Nothing. Nada. I suppose they could do this if everyone ignored the suggestion. If the suggestion had a real impact, it is illegal.

That way, even in a 'free market system', the individual team GM's (and owners) have a 'suggested' benchmark when negotiating contracts with player agents- based on what the NHL and the team's peers value the player to be worth... i.e. interpretation of 'player value' no longer becomes just an individual GM/team decision - but the GM/team is armed with the knowledge of what the NHL and the other teams think the player is worth as well...

Everybody already does that. One of the myths perpetrated by the NHL is that different teams value different players differently prior to the date the player becomes a UFA. The benchmark is the salary paid to similar players around the league.

A player like, say, Simone Gagne is worth a lot more in Philadelphia than in Edmonton in the sense that the Flyers will generate more revenue with him and they can afford to pay more. But they do not pay more for him. That would be very silly. They do not pay more for Gagne than they have to pay for him.

The Flyers have exactly the same leverage over the player as the Oilers do. They pay what the market says they should pay. If Gagne went to arbitration, the Flyers can enter Oiler contracts to support their case. Gagne's agent can't reject those contracts because he is worth more in Philly than in Alberta.

Even if the Rangers pay Holik $9 million, the Rangers (and the rest of the teams) know that the NHL and the other teams value Holik to be $3.5 million, for example. Next season, if Holik plays terrible, the NHL and the owners 'suggested player value' for Holik goes down to $2 million - even though he is still being paid $9 million... Is this legal?

Once Holik becomes a free agent, comparables are meaningless. Holik did not get $9 million because LeClair and Sundin get that or because Guerin got that. He got $9 million because there was another team offering $8.75 million.

At that point in his career, at least 20 teams would not have paid him even $3 million. The Canucks were grooming Artem Chubarov for Holik's role. They were prepared to lose games paying Chubie $800,000 they might have won paying Holik $3 million. When the team is 20 points from a playoff spot, it is stupid to pay $2.2 million extra to miss the playoffs by 10 points. Even if he was already a Canuck they would not retain him because a team that is 20 points from a playoff spot is always better going with a young player than with a veteran in decline.

The Rangers - foolishly - thought Holik could be the difference between making the playoffs and missing them. In their spreadsheet that made him worth at least $9 million. Whatever they decided he was worth, they would have paid less if they could have paid less. If Holik's second best offer was $4.75 million, he is making $5 million today.

Tom

 

[djhn579]

The NHL can't do anything to suppress wages without the union's blessing. Nothing. Nada. I suppose they could do this if everyone ignored the suggestion. If the suggestion had a real impact, it is illegal.




Tom

I know this wouldn't solve all the problems, but could the NHL pass a by-law that if an NHL team lost more than $5M in any one season, or has lost money for 3 straight years, or has a combined loss of over $10M over a 5 year period, the NHL could put a control board over that teams finances, with the goal of ensuring decisions are made to keep the team competetive and profitable? The nunbers of course are debatable, and what constitutes profit or loss would need to be defined.

This would not be directly aimed at lowering salaries, but maintaining the NHL's long term viability. Lower salaries would be a by-product though, since teams couldn't afford to risk paying high salaries and losing money.

There would still be a disparity in what teams can afford, but it wouldn't be as heavily skewed by teams that currently don't care if they lose money.