Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Gary Bettman, Commissioner of the NHL, makes his exit after speaking with reporters following talks with the NHLPA in Toronto on Thursday, August 23, 2012. (Chris Young/THE CANADIAN PRESS)
Gary Bettman, Commissioner of the NHL, makes his exit after speaking with reporters following talks with the NHLPA in Toronto on Thursday, August 23, 2012. (Chris Young/THE CANADIAN PRESS)

What’s at stake in the NHL labour negotiations Add to ...

By now, hockey fans have been more than appropriately bombarded with the facts and figures involved in what has sadly become a familiar fight in their sport.

The NHL wants players to receive 46 per cent of revenues, upping their offer from 43 per cent. The National Hockey League Players’ Association wants closer to last year’s 57 per cent, with its brass willing to take a smaller share of new revenues over the coming three seasons to give them between 52 and 54 per cent.

More Related to this Story

And around and around those percentages go.

What you rarely hear about is the actual bottom line, which is a funny thing given that that is what this battle is about and also why a lockout is likely to begin a week from Saturday.

That bottom line is $1.28-billion (all currency U.S.).

The NHL's average salary since 1990-91

Based on a 7 per cent a season revenue growth rate, the NHL and NHLPA proposals would alter the league's average salary differently. (The dip in 2005-06 highlights the last lockout's 24 per cent rollback.)

It’s a total figure that works out to $320-million a season over the next four years if league revenues continue to grow at the same 7-per-cent rate they have since the last lockout, but it speaks to how far the two sides have to go to get back on the ice by Oct. 11.

NHL commissioner Gary Bettman and NHLPA executive director Donald Fehr were working on that on Friday, meeting in a group of four with their right-hand men for more than two hours in the morning and then again into the night in New York.

The particulars of what was discussed were not revealed, but given the league’s insistence on settling the financial terms before anything else, it’s a safe bet they wrestled with how to find common ground given the thick wad of cash at issue.

“Trying to find a way to bridge the gap,” Fehr told reporters on Friday.

To put the two sides’ positions in context, consider that the players earned $1.87-billion of the league’s $3.28-billion in hockey-related revenues a year ago, a 57-43 split the NHLPA would be happy to continue given it pushed the average salary to $2.44-million.

If the league gets its way for the coming season, however, the players’ 46-per-cent share would mean they receive roughly $390-million less than the current agreement based on projected revenue.

The players’ proposal involves giving up closer to $100-million, money the union wants to put into a $260-million revenue-sharing pot for struggling teams rather than benefit those that make a healthy profit.

The NHL has offered to raise revenue sharing to $190-million from last season’s $150-million, with the extra likely easy to come by given it’s a small fraction – just 10 per cent – of the owners’ savings in their deal.

“We’re not interested in helping the Toronto Maple Leafs make a bigger profit,” one source on the players’ side said this week. “We’re interested in directly targeting the teams that are losing money and guaranteeing that they don’t lose money in a new system. That’s what we’re prepared to do.”

If there’s good news, it’s that the starting point on the players’ side could have been far worse.

When Fehr was named the new union head in December of 2010, there were dire predictions he would fight to remove the salary cap or install a luxury tax similar to the one he helped institute in Major League Baseball. The NHLPA’s first – and to date only – offer in negotiations, however, included a hard cap, escrow and even a pay cut that could mean at least $400-million more going to ownership over the next four years than the current deal.

The reason for playing softball instead of hardball? Not wanting a repeat of 2004-05, the players have essentially given Fehr a mandate to try to find a deal that keeps them close to their current salaries but avoids the last-resort option of missing games.

The current givebacks won’t be enough on their own to get a deal done, not with that $1.28-billion between now and 2015-16 still to whittle away, but the players are hoping their offer of increased revenue sharing and a smaller percentage appeals to enough owners that they can avoid labour armageddon.

So somewhere between the $110-million a season the players are offering to give up and the $430-million a season the league is asking for, there’s an answer.

But all that green in the middle is why it’s taking so long to get there.

Projecting the players' share

The NHL and NHLPA's most recent proposals will affect the players' share of league revenues quite differently compared to 2011-12 levels. (Future revenues are based on a 7 per cent growth rate.)

Follow on Twitter: @mirtle

In the know

Most popular video »

Highlights

More from The Globe and Mail

Most Popular Stories