Class action lawsuits filed against OHL, QMJHL, & WHL

[Fugu]

Should they also get free everything while they're playing, as well as a fully paid education after they're done playing too?

I don't think that's the right question, legally speaking.

It may simply be a matter of how the labor laws define who's an employee, and which institutions can bypass that definition by trading off compensation in the form of scholarships and other benefits (housing, food, equipment, etc.). Yes, all those things have value, and the value may even be greater than what their compensation might be if redrawn, but what do the labor laws say is their legal status?

 

[Blind Gardien]

Or in my desk at home...

I guarantee there is nowhere near "hundreds of millions" in there and Kitchener is financially better off than a lot of teams.

Most of us don't have access to your desk.

I found this story...

http://www.therecord.com/sports-story/4778292-rangers-earn-tidy-profit-despite-missing-playoffs/

I seem to recall them making "a few hundred thousand" in the past, instead of just $116,884.

Now, total revenues of $5-10M might be valid for successful teams, and you might think there are a lot of ways to creatively manipulate where those revenues go and what is left over as profit, but again, the Rangers' books are open, at least, so you can get some idea there. And they are a relatively successful and well-established team in their community. Probably well into the upper-third of the CHL...

 

[PCSPounder]

Gut feelings...

Canada will find a way to protect the owners and codify this as lawful ONLY to junior hockey... for the good of the "true national passion" or somesuch.

That won't be the case south of the border, and those franchises will be lost.

The alternatives:

Junior becomes a "big market" game, probably only in one league.

OR

NHL has to take over player development.

 

[radapex]

I interpreted it to mean hundreds of millions in total. This action is against the CHL, not one team.

It is interesting to see the education debate come around yet again. Milt Dunnell wrote about the flaws in this system in the 1940s. Don Townson wrote a series titled "Hockey's Child-Stealers" about this in the Toronto Star in 1962. Ken Campbell wrote a piece about 10 years ago on the very same topic.

Ok, that would make more sense. Not that it helps the little guy; similar to the NHL, the majority of the revenue comes from a few teams pulling big numbers.

 

[radapex]

I don't think that's the right question, legally speaking.

It may simply be a matter of how the labor laws define who's an employee, and which institutions can bypass that definition by trading off compensation in the form of scholarships and other benefits (housing, food, equipment, etc.). Yes, all those things have value, and the value may even be greater than what their compensation might be if redrawn, but what do the labor laws say is their legal status?

Well, in the case of the NCAA (since they were brought up), then those players are the very definition of "student athlete". They are playing for their school and are already being compensated for (tuition packages, etc).

I read earlier that the CHL is also being named in a $12-million concussion lawsuit. Between that suit, this one, and the push for the players to unionize, I have a hard time believing the CHL will be around much longer.

 

[CharlieGirl]

The claim as I read it is

The league’s teams are “unjustly enriched†with “hundreds of millions of dollars in revenues annually†based on the services provided by their young players, the claim alleges.

That means top line revenues or total dollars taken in, not profits.
Have they eliminated the minimum GPA while playing and pro contract disqualification rules?

Perhaps, but reading "hundreds of millions" hints at more than two. Even based on pure revenue, an average of over $3 million per team is a huge stretch. Sure there are teams who earn more than $3 million but they are the larger markets in each league. The majority don't come close.

As far as CHL rules re: education, players now have 18 months from the end of their overage year (regardless of when they stop playing) to use their scholarships. In addition, as long as they're not playing in the NHL, the scholarship money remains available to them.

 

[CharlieGirl]

I read earlier that the CHL is also being named in a $12-million concussion lawsuit. Between that suit, this one, and the push for the players to unionize, I have a hard time believing the CHL will be around much longer.

Lots and lots of questions surrounding that lawsuit, but the timing of the publicity is interesting, given that the initial case was filed a couple of years ago.

 

[UsernameWasTaken]

Should they also get free everything while they're playing, as well as a fully paid education after they're done playing too?

They don't all get a "fully paid education" when they're done playing. There is a time limit to it.

 

[superdeluxe]

This article lists the Seattle Tbirds having annual revenue between 1 million and 2.5 million.

http://www.manta.com/c/mtxd2sw/seattle-thunderbirds-hockey

 

[DyerMaker66*]

I'd like to know where they're getting that figure, because I'd be shocked if any team even hits the $10-million mark. Here are the top drawing teams from each of the three leagues, by combined (regular season + playoff) attendance:

WHL - Calgary Hitmen - 319,582
OHL - London Knights - 342,342
QMJHL - Quebec Remparts - 357,743

Playoffs were a relative non-factor for all three as London played just four home playoffs games, Calgary three, and Quebec two. So a reasonable maximum for ticket income would be to take the top ticket price (single game adult) and multiply it by total attendance. That gives us:

WHL - Calgary Hitmen - 319,582 x $26.00 = $8,309,132
OHL - London Knights - 342,342 x $19.75 = $6,761,254
QMJHL - Quebec Remparts - 357,743 x $15 = $5,366,145

I think you'd be hard pressed to find a team with a higher max ticket price than Calgary. Realistically, you're looking at a ceiling of $9-million in ticket revenue per season. I'm interested to see where the other $91-million comes from...

Your numbers are wrong: You can purchase tickets to Knights games for $34 bucks

 

[radapex]

Your numbers are wrong: You can purchase tickets to Knights games for $34 bucks

I see that, but it's limited to club level. The $19.75 for everything else makes a better approximation because the volume is much higher. A better one could be made if there was an actual number of tickets available for each level so the club level can be adjusted for. Of course, both are bad in practice because season tickets are going to offer a fair reduction in price for a large portion of those in attendance.

 

[seanlinden]

Should they also get free everything while they're playing, as well as a fully paid education after they're done playing too?

In the absence of a union, that should depend on what the player is able to negotiate for with the ~60 teams competing for his services.

@sean. Student-athletes at US colleges are subject to employment and tax laws if they get any other job. Their student-athlete status simply refers to their relationship with the universities and NCAA.

These teams seem to be relying on that definition as something the kids are doing otherwise (going to school) while playing, but not their legal status with the team itself.

Yeah, that was my sense as well. There seems to be an implication that to qualify for that relationship exemption, one must "play" for the school.

If somebody at a Canadian University is given a scholarship by the school (and or room/board/whatever) to play for that team, then they certainly fall into that student-athlete definition. Here, they seem to be trying to replace immediate payment with a future scholarship.

 

[TaketheCannoli]

Perhaps, but reading "hundreds of millions" hints at more than two. Even based on pure revenue, an average of over $3 million per team is a huge stretch. Sure there are teams who earn more than $3 million but they are the larger markets in each league. The majority don't come close.

As far as CHL rules re: education, players now have 18 months from the end of their overage year (regardless of when they stop playing) to use their scholarships. In addition, as long as they're not playing in the NHL, the scholarship money remains available to them.

RE: the education rules:

Do they have 18 months from the end of their overage year to complete their degree?

Are they allowed to sign professional contracts excludung an NHL contract, ie. AHL/ECHL/SEL etc?

 

[NHL Dude 120]

I support the players completely in this situation, that said the players and the league need to negotiate a fair wage, minimum wage should be the starting point but frankly $500 a week is good enough.

While the CHL does offer generous scholarships they should pay their players a fair wage, not saying they should make millions but a fair price.

If teams can't afford to pay their players a fair wage they should fold.

 

[Fugu]

Well, in the case of the NCAA (since they were brought up), then those players are the very definition of "student athlete". They are playing for their school and are already being compensated for (tuition packages, etc).

Even that is in question now due to the amount of money being made, that the NCAA put restrictions on the students' ability to make any money from their own images or even to get jobs, and that they "worked" 50-60 hrs per week, well above the NCAA's stated limit.

They actually had become a special class of students with separate rules placed on them (even what majors they could take) that never applied to regular students.

So if the NCAA has trouble proving they're not employees, imagine the case a for-profit, noneducational entity might have?

 

[Fugu]

In the absence of a union, that should depend on what the player is able to negotiate for with the ~60 teams competing for his services.



Yeah, that was my sense as well. There seems to be an implication that to qualify for that relationship exemption, one must "play" for the school.

If somebody at a Canadian University is given a scholarship by the school (and or room/board/whatever) to play for that team, then they certainly fall into that student-athlete definition. Here, they seem to be trying to replace immediate payment with a future scholarship.

So the next question is.... how are you a student athlete if you never go to school and use your scholarship?

 

[CharlieGirl]

RE: the education rules:

Do they have 18 months from the end of their overage year to complete their degree?

Are they allowed to sign professional contracts excludung an NHL contract, ie. AHL/ECHL/SEL etc?

My understanding is that they have 18 months from the end of their overage year to enrol in school. And yes, the only contract that nullifies the education package is an NHL contract.

I support the players completely in this situation, that said the players and the league need to negotiate a fair wage, minimum wage should be the starting point but frankly $500 a week is good enough.

While the CHL does offer generous scholarships they should pay their players a fair wage, not saying they should make millions but a fair price.

If teams can't afford to pay their players a fair wage they should fold.

If teams are paying each player $500 per week, then should they also charge players for room and board, equipment, and all the other perks that go with playing for a CHL team, and eliminate the scholarship program? If so, then teams may end up farther ahead but the players won't be.

 

[Fugu]

If teams are paying each player $500 per week, then should they also charge players for room and board, equipment, and all the other perks that go with playing for a CHL team, and eliminate the scholarship program? If so, then teams may end up farther ahead but the players won't be.

Why would the players have to pay the league room and board? If they're normal employees, they would have to arrange for their quarters, or if league brokered, pay the host family-- if that's where they end up living.

Equipment is something the employer normally provides, up to certain limits (like hockey sticks in the NHL).



@ No one in particular.... if this system is overturned, the teams will have to recruit players, so some supply-demand effects go into the equation. They're not going to attract many players if they don't pay them enough for them to pay for most of their actual costs.

 

[seanlinden]

If teams are paying each player $500 per week, then should they also charge players for room and board, equipment, and all the other perks that go with playing for a CHL team, and eliminate the scholarship program? If so, then teams may end up farther ahead but the players won't be.

$500 a week, assuming a 40 hour work week, equates to $12.50 an hour. I'd be inclined to agree that seems to be a reasonable starting point.

As for what else they should provide, one would assume the teams provide the equipment necessary to perform the job. In terms of room/board, likely not, but at the same time, the players should be free to pick their employer of choice, and not have a cartel decide for them through a "draft". I suspect many in that case would be happier to stay at home, and it would be up to teams to decide if they want to pay to have a player relocate for them.

 

[CharlieGirl]

Why would the players have to pay the league room and board? If they're normal employees, they would have to arrange for their quarters, or if league brokered, pay the host family-- if that's where they end up living.

Equipment is something the employer normally provides, up to certain limits (like hockey sticks in the NHL).

They wouldn't pay the league, but could be responsible for their own room and board, as well as expenses currently reimbursable (i.e. cellphones, gas, etc.) and training expenses (players now receive up to $1,000 for offseason training).

As far as equipment, an employer does provide that, but employers don't typically provide employees with clothing to wear outside of work and unless you work for a very large company, medical and training facilities are the employee's responsibility.

@ No one in particular.... if this system is overturned, the teams will have to recruit players, so some supply-demand effects go into the equation. They're not going to attract many players if they don't pay them enough for them to pay for most of their actual costs.

Perhaps, but if 1/3 to 1/2 of the teams fold, there will be far more players than there are spots. Supply and demand effects will factor in on that side as well. Let's not forget that the opportunity to be seen by scouts and drafted to the NHL is a goal of most players who sign with a CHL team. It certainly doesn't always work out for them, but there is a definite benefit to players who play for CHL teams.

 

[CharlieGirl]

$500 a week, assuming a 40 hour work week, equates to $12.50 an hour. I'd be inclined to agree that seems to be a reasonable starting point.

As for what else they should provide, one would assume the teams provide the equipment necessary to perform the job. In terms of room/board, likely not, but at the same time, the players should be free to pick their employer of choice, and not have a cartel decide for them through a "draft". I suspect many in that case would be happier to stay at home, and it would be up to teams to decide if they want to pay to have a player relocate for them.

I'm sure there are players who would love to play at home, and there are some who do. The vast majority of players, however, do not have a CHL team in their hometown so that's not a valid option is it?

Players benefit from playing in the CHL and the CHL benefits from having players play the game, and from fans who buy tickets. There is no slave labour situation here, nor are players forced to play in the CHL. Enough with the cartel nonsense.

 

[Fugu]

They wouldn't pay the league, but could be responsible for their own room and board, as well as expenses currently reimbursable (i.e. cellphones, gas, etc.) and training expenses (players now receive up to $1,000 for offseason training).

As far as equipment, an employer does provide that, but employers don't typically provide employees with clothing to wear outside of work and unless you work for a very large company, medical and training facilities are the employee's responsibility.



Perhaps, but if 1/3 to 1/2 of the teams fold, there will be far more players than there are spots. Supply and demand effects will factor in on that side as well. Let's not forget that the opportunity to be seen by scouts and drafted to the NHL is a goal of most players who sign with a CHL team. It certainly doesn't always work out for them, but there is a definite benefit to players who play for CHL teams.

I'm not disagreeing that the set up is reasonable, or possibly even beneficial to most players. Those that disagree however seem to have found a way to point out that legally these guys are employees-- per existing labor laws. The legal status debate will determine if the system gets taken apart or not. In fact, you may be quite right that it won't be better for the players.

 

[Ernie]

I'd like to know where they're getting that figure, because I'd be shocked if any team even hits the $10-million mark. Here are the top drawing teams from each of the three leagues, by combined (regular season + playoff) attendance:

WHL - Calgary Hitmen - 319,582
OHL - London Knights - 342,342
QMJHL - Quebec Remparts - 357,743

Playoffs were a relative non-factor for all three as London played just four home playoffs games, Calgary three, and Quebec two. So a reasonable maximum for ticket income would be to take the top ticket price (single game adult) and multiply it by total attendance. That gives us:

WHL - Calgary Hitmen - 319,582 x $26.00 = $8,309,132
OHL - London Knights - 342,342 x $19.75 = $6,761,254
QMJHL - Quebec Remparts - 357,743 x $15 = $5,366,145

I think you'd be hard pressed to find a team with a higher max ticket price than Calgary. Realistically, you're looking at a ceiling of $9-million in ticket revenue per season. I'm interested to see where the other $91-million comes from...

I believe the context is that the teams collectively earn in the hundreds of millions, not individually!

There are 60 teams, so each team would need $3.5m in revenues to reach $200m for the CHL.

Just did a little back of the napkin math, the leagues would need to spend between $20m to $30m to meet minimum labour standards.

 

[Tommy Hawk]

Perhaps, but reading "hundreds of millions" hints at more than two. Even based on pure revenue, an average of over $3 million per team is a huge stretch. Sure there are teams who earn more than $3 million but they are the larger markets in each league. The majority don't come close.

As far as CHL rules re: education, players now have 18 months from the end of their overage year (regardless of when they stop playing) to use their scholarships. In addition, as long as they're not playing in the NHL, the scholarship money remains available to them.

$200 million is hundreds. Does the CHL also control the lower junior leagues (BCJHL et.al.) in Canada? If so, those need to be factored in as well.

I support the players completely in this situation, that said the players and the league need to negotiate a fair wage, minimum wage should be the starting point but frankly $500 a week is good enough.

While the CHL does offer generous scholarships they should pay their players a fair wage, not saying they should make millions but a fair price.

If teams can't afford to pay their players a fair wage they should fold.

A student athlete is someone going to school while playing a sport for that school. How is playing hockey outside of the school any different than working at Tim Hortons outside of school? How many 18, 19 and 20 year old players are actually attending school while playing? My guess is none.

So the next question is.... how are you a student athlete if you never go to school and use your scholarship?

Simple, you're not. Even if you use the scholarship, you are not a student athlete unless attending school while playing for the school.

Why would the players have to pay the league room and board? If they're normal employees, they would have to arrange for their quarters, or if league brokered, pay the host family-- if that's where they end up living.

Equipment is something the employer normally provides, up to certain limits (like hockey sticks in the NHL).



@ No one in particular.... if this system is overturned, the teams will have to recruit players, so some supply-demand effects go into the equation. They're not going to attract many players if they don't pay them enough for them to pay for most of their actual costs.

In the NCAA, a lot of people seem to forget that most of these athletes are on scholarships. A 4 year education at these schools, including room and board can be well over $10,000 per year. They are getting paid in the form of a scholarship.

 

[Ernie]

In the NCAA, a lot of people seem to forget that most of these athletes are on scholarships. A 4 year education at these schools, including room and board can be well over $10,000 per year. They are getting paid in the form of a scholarship.

Even then, the lack of compensation for college athletes in the US is becoming quite a contentious issue, more so for football and basketball than hockey.