Let's play the negotiation game - some of us can be Bob and some of us can be Gary

[FlyersFan10*]

Dont be daft. How does this break the union?

I'm pro union.

 

[Tom_Benjamin]

Luxury tax does not work. Refer to NHL.com for a reasonable explanation by Daly on why it won't work and doesn't work elsewhere.

Work to do what?

Tom

 

[CoolburnIsGone]

Sorry Bob but the owners want to regain control of the NHL that they each invested hundreds of millions of their dollars into. 40-45 million is basically status quo and keeps players % of revenue at over 70% which is no longer acceptable on the owners part. I'm not looking for a hard cap per say. Call it a flex cap, homegrown cap, cost certainty whatever you prefer but our owners want a system where they know going into each season how much money is needed to budget for player salaries just like most other professional sports and most other business ventures in North America. Your going to have to do better and I would suggest a lot better before I can take your proposals back to the owners for their consideration.

But Gary what was stopping the owners from taking control of their teams? I mean the owner gets an income statement from the previous year and knows what the revenues are. Based on that number, the owner can decide what percentage of the revenue to spend on salaries. Its exactly what you're talking about...setting a budget. But why does it have to be the same across the entire league? A doctor in NY or LA doesn't make the same salary as a doctor in Columbus or Minnesota. Its just a fact of life in the United States where a majority of the teams are located...certain markets are able to make more money. Is this fair? Maybe, maybe not. But each owner still maintains the ability to set a budget anytime they choose for whatever amount they choose. In Florida, the revenues earned may be less than Toronto and I can see both ownerships saying we only want to spend 61% of revenues on our payroll. Well that's okay...they each set a budget for their team but because Toronto earns more, they can spend more. Just makes sense to me.

Now our offer is based on what the owners wanted during the last strike in 1994. We took that into consideration and formulated an offer that we really feel is fair. Why is it that back in 1994 you were willing to negotiate a system based on a luxury tax and revenue sharing but now you won't even discuss it as a possibility? Yes we don't want to discuss a plan involving a cap (or if you want to call it "cost certainty") but that's exactly what you're doing with the luxury tax/revenue sharing plan we offered. A pot calling a kettle black...its time you realize that you're also going to have to do better before I can take any proposals back to the players.

 

[Motown Beatdown]

Work to do what?

Tom

Work to guarantee profits for all 30 teams. Thats what the owners are after.

 

[thinkwild]

I'm pro union.

lol, Im not misreading you. sorry, forgot my /sarcasm tags.

edit:
ok even that didnt clear it up, yes I know you are pro-union, the sarcasm wasnt directed at you. I was using your good post to direct it at others not as thoughtful as you.

 

[thinkwild]

But Gary what was stopping the owners from taking control of their teams? I mean the owner gets an income statement from the previous year and knows what the revenues are. Based on that number, the owner can decide what percentage of the revenue to spend on salaries. Its exactly what you're talking about...setting a budget. But why does it have to be the same across the entire league? A doctor in NY or LA doesn't make the same salary as a doctor in Columbus or Minnesota. Its just a fact of life in the United States where a majority of the teams are located...certain markets are able to make more money. Is this fair? Maybe, maybe not. But each owner still maintains the ability to set a budget anytime they choose for whatever amount they choose.

And the reason this doesnt turn out to be unfair, is because, quite unexpectedly to me, by only allowing teams with money to spend that on players over 31, the spending advantage for the purpose of long term drafting, developing, and growing with a team capable of being great and winning the most difficult team prize in sports, the spending advantage is surprisingly neutralized.

Bettman himself several years loudly proclaimed that any owner losing money was not using the CBA properly. He would continually talk about how he had charts that players always declined after their UFA years, that the spending didnt work. That the owners had it in their control not to lose money. Even Glen Sather thought that if he had NYR's money, he could easily build a winner.

Its easy to see why fans have such trouble seeing it. Its highly non-intuitive even to hockey people.

It turned out Bettman was right back then. But barks a new tune now. for his masters, with their new agenda.

 

[me2]

And the reason this doesnt turn out to be unfair, is because, quite unexpectedly to me, by only allowing teams with money to spend that on players over 31, the spending advantage for the purpose of long term drafting, developing, and growing with a team capable of being great and winning the most difficult team prize in sports, the spending advantage is surprisingly neutralized.

Bettman himself several years loudly proclaimed that any owner losing money was not using the CBA properly. He would continually talk about how he had charts that players always declined after their UFA years, that the spending didnt work. That the owners had it in their control not to lose money. Even Glen Sather thought that if he had NYR's money, he could easily build a winner.

Its easy to see why fans have such trouble seeing it. Its highly non-intuitive even to hockey people.

It turned out Bettman was right back then. But barks a new tune now. for his masters, with their new agenda.

That was also pre-salary suicide. Ironically, back when he said that the salaries were effectively in line with the $1.3m avg Bettman wants now. I'm sure if the players all votes to reduce their salaries to an average of $1.3m Bettman might resume his former position.

 

[thinkwild]

Their revenues were significantly lower too. They needed to spend a higher percentage of revenue on their fixed costs and so the players got a lower percentage of the overall revenue. When revenues rose, the percentage going to players naturally also rises. Thats not an inherent sign of inflation. Thats what you would expect in normal circumstances.

THe players seem to recognize it went too high. And are offering means to reset it. The owners are afraid its too hard work for them. Billionaires no longer want to work for their money?

 

[me2]

Their revenues were significantly lower too. They needed to spend a higher percentage of revenue on their fixed costs and so the players got a lower percentage of the overall revenue. When revenues rose, the percentage going to players naturally also rises. Thats not an inherent sign of inflation. Thats what you would expect in normal circumstances.

THe players seem to recognize it went too high. And are offering means to reset it. The owners are afraid its too hard work for them. Billionaires no longer want to work for their money?

Five years ago player costs represented 59% of the NHL's total revenues. Last season they were 66% of revenues, as salaries have gone up 1.4 times as fast as revenues have since 1999.

http://www.forbes.com/free_forbes/2004/1129/124sidebar2.html

 

[thinkwild]

This is what I just told you. As revenues go up, the normal thing you would expect in a proper business environment is that player costs as a percentage of revenues increases as revenues increase. IF they were to negotiate a cap, it would have to be a sliding cap. If they 60% of revenues at $2bil, they would get maybe 80% at $3bil.

 

[me2]

This is what I just told you. As revenues go up, the normal thing you would expect in a proper business environment is that player costs as a percentage of revenues increases as revenues increase. IF they were to negotiate a cap, it would have to be a sliding cap. If they 60% of revenues at $2bil, they would get maybe 80% at $3bil.

Those numbers don't add up.

 

[FlyersFan10*]

Sorry Bob but the owners want to regain control of the NHL that they each invested hundreds of millions of their dollars into. 40-45 million is basically status quo and keeps players % of revenue at over 70% which is no longer acceptable on the owners part. I'm not looking for a hard cap per say. Call it a flex cap, homegrown cap, cost certainty whatever you prefer but our owners want a system where they know going into each season how much money is needed to budget for player salaries just like most other professional sports and most other business ventures in North America. Your going to have to do better and I would suggest a lot better before I can take your proposals back to the owners for their consideration.

Regarding your addenum Bob, we held meetings and made several recommendations that we believe can improve the game. It's our goal to fix the game and fix the financial shortcomings of the league all at once, unfortunatley, you decided to put in a grievance against our recommendations, hence, they have been put on hold and again the owners want to regain overall control of the league so the right to make changes now must be part of the new CBA. We to enjoyed the hockey in Salt Lake City but the World Cup was a bit disappointing perhaps because of the looming CBA lockout.

Once again Gary, I can see where you're coming from, but you're asking us to make 100% of the sacrifice with regards to correcting the financial problems. Once again, how can we be a partnership if we're the ones who are footing 100% of the bill. That doesn't sound like a partnership to me. As for the owners who have invested "hundreds of millions of their own dollars" into the teams, you just need to read the Forbes article to see that the actual value of the teams in the NHL has increased by an average of $50 million dollars. So, I can't buy for one second that owners are claiming poor and bankrupt when they are adding an additional $50 million to their personal fortune. I can't see how the league is losing all this money if the owners are making so much. The numbers don't add up Gary.

As a union, we understand that there are always going to be competitive gaps in the game. However, full revenue sharing amongst everyone is the conclusion to this problem. However, you don't want owners to share revenue with one another. What you want is for players to give up their portion and give it back to owners. That's not going to happen.

As for trying to make the game better, we've had Teemu Selanne, Brett Hull, even two of your owners Gretz and Lemieux state the game needs to change. We've agreed and we've wanted to do something. You're response to everything Gary is "we'll try it in this league first and go from there." We're the NHL, Gary. We're supposed to be the radical league. We're supposed to be innovators, not immitators. We have the best game on ice, but it's marketed even worse than the movie Gigli. C'mon Gary, get real. We as players have been calling for mass change, the owners response has been to crawl.

It's clear we're going to agree to disagree, but we need to get to the table and start negotiating again. Tell you what, let's start by working on what we can agree to and build somekind of a frame work. We'll then tackle the salary issue towards the end. I mean, everything else we tried hasn't worked, so maybe this is the start that we need....let's find some common ground and build from there.

 

[Spezza]

Work to guarantee profits for all 30 teams. Thats what the owners are after.

Couldn't the teams just decide not to renew contracts that they can't afford? Do we really need a cap to force teams to stick to a budget?

 

[garry1221]

This is what I just told you. As revenues go up, the normal thing you would expect in a proper business environment is that player costs as a percentage of revenues increases as revenues increase. IF they were to negotiate a cap, it would have to be a sliding cap. If they 60% of revenues at $2bil, they would get maybe 80% at $3bil.

I agree with the sliding %, but not the values as you've got them, i think something like the following would work better for both sides, I'm of the mind that it's the owner's business/franchise and therefore he deserves a profit of some kind. he's investing his money and if nothing else, at least deserves to break even. A lux tax is seemingly the only way to appease both sides. 1 for 1 the PA will call off as a cap, but if it's too little, such as .25 to 1 is too soft. There needs to be a place between a concrete wall and the wet papertoweling. I'd propose a lux tax starting at .50:1 on the first million over, .80:1 on two million over, 1:1 on everything else over. Starts off gently and grows stronger. Lux tax threshhold/soft cap to ultimately be set at 43 million (close enough to league ave.)

I'd phase it in over 3 years to allow most of the present contracts to die off. 1st year threshhold at 63 million. 2nd year at 50 million. 3rd year final at 43 million. I'd make two steps to the salary floor. 27 million dollar lower threshhold. If a team is below 27 million then they get no money and their share is either a) put in a players' retirement fund or b) spread between the rest of the teams.

back to the revenue sharing. I think this table could work for both sides.

2 bil rev. players get: 64% (1.28 billion) leaving the owners with 720 mil (24 mil)
3 bil rev. players get:68.5% (2.055 bil) leaving the owners with 945 bil (31.5 mil)
4 bil rev. players get: 73% (2.92 billion) leaving the owners with 1.08 bil (36 mil)
5 bil rev. players get: 76% (3.8 billion) which leaves the owners 1.2 bil (40 mil)
6 bil rev. players get: 79% (4.74 billion) leaving the owners with 1.26 bil (42 mil)
7 bil rev. players get: 79.75% (5.5825 billion) owners get 1.4175 billion ( 47.25 mil)
8 bil rev. players get: 82.75% (6.62 billion) leaves the owners w/ 1.38 bil (46 mil)
9 bil rev. players get: 84% (7.56 billion) leaving the owners with 1.44 bil (48 mil)
10bil rev. players get: 85% (8.5 billion) which leaves the owners w/ 1.5 bil (50 mil)

i know i'm going above what we may ever see, but IMO if the nhl ever comes to be a 10 billion dollar league then the owners deserve the share on the table. As i've said before, i believe the owners do deserve a profit of some kind. I'd make the stipulation that the owners must put at least half of that money back into their team (lockerroom, excersize/training equipment, etc). Should evidence be found that shows an owner didn't put the required amount back into his team, he's subject to fines and said team doesn't get money from revenue sharing. The year after that said team gets 50% of what they should be getting (the required amount). Should this happen again stiffer penalties will be brought against the owner.

 

[ti-vite]

I agree with the sliding %, but not the values as you've got them, i think something like the following would work better for both sides, I'm of the mind that it's the owner's business/franchise and therefore he deserves a profit of some kind. he's investing his money and if nothing else, at least deserves to break even. A lux tax is seemingly the only way to appease both sides. 1 for 1 the PA will call off as a cap, but if it's too little, such as .25 to 1 is too soft. There needs to be a place between a concrete wall and the wet papertoweling. I'd propose a lux tax starting at .50:1 on the first million over, .80:1 on two million over, 1:1 on everything else over. Starts off gently and grows stronger. Lux tax threshhold/soft cap to ultimately be set at 43 million (close enough to league ave.)

I'd phase it in over 3 years to allow most of the present contracts to die off. 1st year threshhold at 63 million. 2nd year at 50 million. 3rd year final at 43 million. I'd make two steps to the salary floor. 27 million dollar lower threshhold. If a team is below 27 million then they get no money and their share is either a) put in a players' retirement fund or b) spread between the rest of the teams.

back to the revenue sharing. I think this table could work for both sides.

2 bil rev. players get: 64% (1.28 billion) leaving the owners with 720 mil (24 mil)
3 bil rev. players get:68.5% (2.055 bil) leaving the owners with 945 bil (31.5 mil)
4 bil rev. players get: 73% (2.92 billion) leaving the owners with 1.08 bil (36 mil)
5 bil rev. players get: 76% (3.8 billion) which leaves the owners 1.2 bil (40 mil)
6 bil rev. players get: 79% (4.74 billion) leaving the owners with 1.26 bil (42 mil)
7 bil rev. players get: 79.75% (5.5825 billion) owners get 1.4175 billion ( 47.25 mil)
8 bil rev. players get: 82.75% (6.62 billion) leaves the owners w/ 1.38 bil (46 mil)
9 bil rev. players get: 84% (7.56 billion) leaving the owners with 1.44 bil (48 mil)
10bil rev. players get: 85% (8.5 billion) which leaves the owners w/ 1.5 bil (50 mil)

i know i'm going above what we may ever see, but IMO if the nhl ever comes to be a 10 billion dollar league then the owners deserve the share on the table. As i've said before, i believe the owners do deserve a profit of some kind. I'd make the stipulation that the owners must put at least half of that money back into their team (lockerroom, excersize/training equipment, etc). Should evidence be found that shows an owner didn't put the required amount back into his team, he's subject to fines and said team doesn't get money from revenue sharing. The year after that said team gets 50% of what they should be getting (the required amount). Should this happen again stiffer penalties will be brought against the owner.

Please expand for 1bil, 0.75bil, and 0.5bil...

You never know...

 

[FLYLine27*]

Gary: WE will have a CAP!
Bob: No, there are other ways of cost certainety how abou.....
Gary: NO!!!!! CAP ONLY!!!!
Bob: Gary please...listen to what I hav...
Gary: CAP!!!!! AHHHHH!! CAP!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Bob: Wtf? Gary are you ok?
Gary: CAP CAP CAP CAP CAP CAP
Bob: Are you under the influence of any type of drugs?
Gary: If this doenst involve a CAP then im LEAVING!
Bob: Your an idiot Gary...your killing hockey because you want a Cap..
Gary: CAP! YES! So you AGREE With a Cap?!?!?
Bob: NO YOU MORAN!!!!!!!!!!!!

:Bob Leaves:

 

[me2]

Gary: WE will have a CAP!
Bob: No, there are other ways of cost certainety how abou.....
Gary: NO!!!!! CAP ONLY!!!!
Bob: Gary please...listen to what I hav...
Gary: CAP!!!!! AHHHHH!! CAP!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Bob: Wtf? Gary are you ok?
Gary: CAP CAP CAP CAP CAP CAP
Bob: Are you under the influence of any type of drugs?
Gary: If this doenst involve a CAP then im LEAVING!
Bob: Your an idiot Gary...your killing hockey because you want a Cap..
Gary: CAP! YES! So you AGREE With a Cap?!?!?
Bob: NO YOU MORAN!!!!!!!!!!!!

:Bob Leaves:

Typical NHLPA walking out on negotiations

 

[FLYLine27*]

Typical NHLPA walking out on negotiations

.....what negotiations? The point of it was there was none by the Owners.

 

[me2]

.....what negotiations? The point of it was there was none by the Owners.

Or by Bob

 

[ehc73]

Work to guarantee profits for all 30 teams. Thats what the owners are after.

But the owners are insisting it's a business. Guaranteeing profit in a business is ludicrous. Now they're just wanting everything to be done for them instead of running a business properly.

 

[codswallop]

If negotiations were as simple as some believe it to be, this would have been resolved a long time ago. It's not as simple as making a high offer (or dream offer) and then bargaining your way into a deal that you would have been comfortable to accept from the start.

It can work that way, sure. But there are many times when it won't, and there shouldn't be any surprise in that. It's just the nature of the beast, you accept the fact that it can be easy or it can turn ugly. You don't ***** and moan that it should be this way or it should be that way. You move on.

And in this era of a media obsessed culture, they can fight part of this battle through many sources. TV, radio, print, etc. Notice that I put in "part" of the battle. As the general public, we have only a small percentage of the real information dealing with this labor battle. I'm not saying that the two sides in this have perfect information (that just doesn't happen), but they both know loads more than have been released through the media and through public record. Parts of this battle are occuring, and we have no real idea what they are and how they are progressing.

I've never been directly involved with a labor dispute, but I have been on the inside and seen certain info that the public never did. And the dynamic of the negotiations were more than a bit different. Even though I only know a few particulars in this situation, I'm more than confident that the full and complete battle is not nearly as simple as some might believe.

 

[FlyersFan10*]

Being from a family who has involvement with all kinds of labor unions, I have been on the inside of many negotiations. Contrary to popular belief, agreements are very easy to work out.

The difference between those businesses and the NHL is that revenue in the NHL varies. It differs from market to market. Some markets are going to have more money than other markets. So, the NHL's response to this disparity is to look at capping salaries. If they're going to cap salaries, then there should 100% revenue sharing. The problem with that is that guys like Mike Illitch, Ed Snider, Jeremy Jacobs, etc....will not part with their money. The issue here is that they want the players to subsidize the owners.

That's the issue here. If the NHL wants a partnership, then they have to share some responsibility with regards to the financial mess that has been created. The players have made an offer in which they will pick up half the slack. The owner's response has been "you pick up the entire tab and then we'll talk" and that's not the way to get things done.

 

[codswallop]

Being from a family who has involvement with all kinds of labor unions, I have been on the inside of many negotiations. Contrary to popular belief, agreements are very easy to work out.

The difference between those businesses and the NHL is that revenue in the NHL varies. It differs from market to market. Some markets are going to have more money than other markets. So, the NHL's response to this disparity is to look at capping salaries. If they're going to cap salaries, then there should 100% revenue sharing. The problem with that is that guys like Mike Illitch, Ed Snider, Jeremy Jacobs, etc....will not part with their money. The issue here is that they want the players to subsidize the owners.

That's the issue here. If the NHL wants a partnership, then they have to share some responsibility with regards to the financial mess that has been created. The players have made an offer in which they will pick up half the slack. The owner's response has been "you pick up the entire tab and then we'll talk" and that's not the way to get things done.

Many labor disputes have been at least somewhat easy to work out. They agree to a (fairly) common ground, the relationship is more or less a mutual respect. It's rarely perfect but the sides have a basis to start the negotiations, and they both want to come to an agreement.

The ones that I happened to be involved with weren't so cordial (the reason behind my previous comment). From what I know, I just happen to see a parallel in this situation.

Granted, I don't know most of the particulars. So it's probably prudent to take this with a grain of salt. I'll be a cad and say that is the way that most of the comments we've seen here on this subject should be taken (various posters won't, but what can you do?). But the pattern that I've seen before fits here.

Both sides (and it is both sides) have choosen not to make this easy. The "negotiating" process is taken to another level. In my opinion, it's been a waste to take it this far. But I realize that my opinion on this doesn't count for sh*t.

I'd hoped that others might think the same of their opinion; knew the majority wouldn't of course. As skeptical/biased/infuriating as some of the comments have been in the last several months, the sentiment hasn't been surprising at all.

 

[me2]

But the owners are insisting it's a business. Guaranteeing profit in a business is ludicrous. Now they're just wanting everything to be done for them instead of running a business properly.

The players demand guaranteed profits for themselves. You don't see them offering to give up their guaranteed contracts (nor should they).

 

[Motown Beatdown]

Couldn't the teams just decide not to renew contracts that they can't afford? Do we really need a cap to force teams to stick to a budget?

Yes they could. The problem is you have some owners who dont run their teams as a business, it's like a toy to them. So what if they lose 10 million dollars a year. Then you have some who run it as a business, were the bottom line matters first and foremost. Bettman has never been able to control the rouge owners. So now him and the teams who run their teams as a business want the players to reign in these owners.