NHL, union not on same page
TORONTO -- If you're wondering what the chances are of the National Hockey League and its players' association finding the common ground necessary to forge a new collective bargaining agreement before the old CBA expires Sept. 15 (thus, avoiding a potentially lengthy lockout) consider what Commissioner Gary Bettman said to union leadership at the end of Thursday's four-hour bargaining session.
"We're not even talking the same language," an irritated Bettman told the union.
Not too promising, eh?
Then, just minutes after the conclusion of the meeting, Bill Daly, the NHL's chief legal officer and second-in-command, issued a terse five-paragraph statement, proclaiming the league's "extreme disappointment" with the union's latest proposal -- just its second in the last year.
Daly characterized Thursday's NHLPA proposal -- which included a luxury tax/revenue sharing system, a five percent salary rollback across the board and revisions to the current entry-level cap system -- as "a step backwards in the process." Indeed, the proposal wasn't much different from the union's first and only other proposal, which was made public at a bargaining session Oct. 1, 2003.
Linden called the negotiations "frustrating" because of the league's unwillingness to consider any economic system that doesn't feature a direct link between league-wide revenues and players' salaries.
"We offered hard-dollar givebacks in a serious effort to bridge the gap," said Linden, speaking of the 5 percent rollback in salaries, which the union says would result in $100 million for the clubs.
"We've made it clear that we're willing to make significant changes, but we'll never accept a cap or a system that links salaries to revenues," Linden said. "The owners set the value for players. We're not asking for anything more or less."
NHLPA senior director Ted Saskin also doesn't see much room for discussion in the current talks. He believes the league is seeking to impose its will on the players.
"They want a salary cap," Saskin said. "And, salary caps are not negotiated, they're extracted through economic pressure."
Both sides did agree on one thing: No more meetings are scheduled.
With the expiration of the CBA less than a week away, the owners and players seem primed for an ugly labor war that could result in the loss of the 2004-05 season. It would be the first time that any of the four major North American sports leagues lost an entire season due to a labor dispute.
If that happens, there will be plenty of blame to go around.
Certainly, the league may well have merit in its need for cost certainty (salary cap). But, owners off as less than honest when they don't clearly disclose the financial reports on each team. Bettman and his owners can't have it both ways. They can't claim horrific losses, then force the union to sign confidentiality agreements that prohibit their leadership from making the financial numbers part of the public debate. (With all due respect to former SEC chairman Arthur Levitt, his report on the league's financial woes lacks credibility because it was paid for by the league and excluded union participation.)
The union, on the other hand, hasn't gotten serious enough with its luxury tax proposal. A league source claims the latest tax proposal starts at the $50 million (per team) threshold, up $10 million from the first proposal of $40 million. That same source says the tax would be roughly a dime on every dollar spent over the threshold. That's not good enough.
The union's proposal, however, should be a starting point that would lead to an acceptable compromise for both sides. In the end, a fair deal could be reached with a luxury tax threshold set at approximately $35 million. A dollar-for-dollar tax on any money spent over that figure would provide a reasonable incentive for the individual clubs to start acting responsibly and begin to run their businesses with some degree of common sense.
As part of the deal, the league could seek an end to the salary arbitration system that has been boom for the players. This season, for example, players who went through the entire arbitration system were awarded an average raise of about 70 percent. Even those players who filed for arbitration, then settled with their respective clubs before an arbitrator's decision, still skated away with an average salary increase of about 50 percent.
The league would also be wise to gain concessions in a qualifying procedure that forces clubs to give a 10 percent raise to a player making less than the league average in order to keep his rights, thereby dragging salaries up from the bottom.
And, Bettman's boys would be smart to close down the loopholes in the entry-level system. Those loopholes -- brilliantly exploited by player agents -- have allowed entry-level players to supplement their base salaries through a series of easily attainable bonuses.
To get these significant concessions, the league would have to be willing to address its free agent system. Currently, a player can't become a group 3 (unrestricted) free agent until age 31. That age might be reasonably lowered to 28.
While these are just some suggestions, there seems to be room for reasonable compromise. And, that compromise comes without the extreme pain of a lockout in a sport that can ill afford to be off the radar screen for any length of time.
For now, the clock is ticking. Neither side seems to be speaking the same language. For the sake of the game, they'd better find a translator ... and soon.
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