The six major elements of the NHLPA’s plan as presented to the owners include:
1) 24% Compensation Rollback
An overall market deflator that resets player compensation at a new, sharply reduced level by rolling back all player compensation by 24% through the life of existing contracts. The rollback in compensation over three years will be $528M. In addition to an immediate economic impact for owners and their teams, the deflator will have major ongoing effects on new contracts.
2) Future Salary Restraints (Entry Level System, Qualified Offers and Arbitration)
A new set of system deflators that will reduce spending on the individual contracts executed in the new, rolled-back marketplace. These system deflators include substantial restraints in the ELS; reduced qualifying offers; the use of rolled-back and new contracts as the only comparables available in salary arbitration and in negotiations for new contracts; and the use of arbitration at the election of the club for two new purposes identified by the NHL as important.
Conservatively these system benefits to owners will pull $400M out of the ELS system over the next six years, reduce the aggregate qualifying offers due to Group II Players by $285M over three years and provide other benefits.
3 ) Payroll Tax
A payroll tax with thresholds that begin at $45M, tax rates between 20% and 60% for first time taxpayers and higher rates for repeat taxpayers. If a club triggers the tax, its payments will be pooled for distribution by the NHL and NHLPA.
4) Revenue Redistribution Plan
A revenue redistribution plan that will transfer money from the high-revenue clubs to the low-revenue clubs, and encourage low-revenue clubs to increase their own revenues. The redistribution will inhibit spending on players by the clubs that have formerly spent the most.
This plan offers three alternatives to the NHL with amounts ranging from $65M, to $124M and $190M, respectively.
5) Joint Player-Club Committees
Joint Player-Club committees designed to ensure real improvements in the game, its marketing and its revenues, along with other areas of mutual concern. As an initial step, the players propose to commit to play in the 2006 and 2010 Olympics.
6) Ongoing Adjustments and Updates
Adjustments and updates to a variety of other CBA provisions..
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