in plain English
After more than 300 days of National Hockey League lockout, hockey fans across North America rejoiced this week as the NHL and the NHL Players’ Association ratified the long-awaited new Collective Bargaining Agreement (CBA).
But now, the real work for the NHL and the NHLPA really begins. This time they’ll need to be partners with a vested interest in growing the game.
After having lost and an entire season, over two billion dollars in revenue, a nation-wide TV deal with ESPN, and countless fans—especially south of the border—the NHL faces a long road back to prosperity.
But what does the new CBA really mean for the game, the players and, most importantly, the fans?
While the rhetoric of salary caps, cost certainty, linkage, and pensions will certainly die down from the level seen before the resolution, work has only just begun on evaluating the long-term effects of the agreement.
On the surface, the CBA looks like a lopsided win for the owners and NHL Commissioner Gary Bettman. The players said they would never accept a salary cap but a ceiling of $39 million has been implemented on player salaries.
In addition, no player can make more than 20 per cent of that $39 million. In effect, there is a double cap on the elite players of the NHL, like Calgary Flames superstar Jarome Iginla, who will be permitted to make a maximum of $7.8 million in the 2005-2006 season. The NHLPA was also opposed to linkage—the tying of player salaries to total NHL revenues. There is now salary linkage stating that player compensation cannot exceed 54 per cent of total league revenues.
To make matters even less profitable for the players, four per cent of their yearly salaries will be placed in escrow s. If league revenues fall below their projected numbers, the money in these alternate s will be given back to the owners, not the players.
Add all this to the one-time 24 per cent rollback in player salaries, and it appears the NHLPA lost this negotiation process in a big way.
But this scope of evaluation is limited, and it overlooks the significant gains the players were able to achieve.
The major victory was a liberalized free agent market. Before this agreement, all players were eligible to become unrestricted free agents (UFA) at age 31 and were free to move to the team willing to offer the
most money.
The UFA age will now drop gradually until the 2008-2009 season, at which point players aged 27 or older will be eligible to move to the destination of their choice.
In addition, any players who have played seven seasons in the NHL will be eligible. So 17-year-old Sidney Crosby—the NHL’s next projected superstar—will be a free agent at the tender age of 25.
Furthermore, as the league grows, player salaries will increase substantially. If the NHL takes in $2.7 billion or more, the players will receive 57 per cent (up from 54 per cent) of that revenue and the salary cap will go up.
Add to this shortened training camps—especially for veterans—less travel through a revamped schedule system and generous pension plans, and it quickly becomes clear that the NHLPA also made major gains.
So what does it all mean for the NHL and the NHLPA? For the first time in league history, players will have an interest in making hockey more popular because as revenues go up, so do their salaries.
It will also mean an unprecedented rate of player movements over the summer as high-spending teams scramble to get under the salary cap.
For small market teams, an infusion of elite players being let go by such teams could give their fans hope of seeing their team make the playoffs next spring.
But the question remains—will anyone really care? In Canada, fans will come back in droves as they always have, but in the U.S. the NHL faces a tough uphill battle to change the image of the game referred to as “ice soccer” on sports radio shows down south.
Sure, countless man hours went into negotiating and drafting the 600-page CBA, and yes, many sleepless nights were spent in meetings all over the continent. But what all parties know for sure is that there is a long way left to go before this extensive, drawn-out struggle is put in the past.
Previously troubled markets will almost certainly struggle to bring fans back to arenas that were barely half full before the lockout, especially in the land where NASCAR reigns supreme.
We need look no further than Major League Baseball, where a 1994 labour dispute wiped out the World Series and fans stayed away for much of the late 1990s.
This fact seems particularly worrisome as baseball is more a part of American culture than hockey will ever be. Rebound time from this lockout is expected to be more prolonged and painful.
It is tough to say who won in the CBA, but it is easy to see who lost. The thousands of people who work near NHL arenas saw their restaurants and bars empty. People employed by NHL teams were laid off. Queen’s hockey fans were denied their exam-time playoff solace.
The sport of hockey and the NHL have had their reputations tarnished as the public perception of both players and owners has dipped to an all-time low.
The fans have been hurt, and as a result both the players and owners will need to mount a campaign to improve the image of the game and convince people to fill arenas in October.
But here in the great white north, fans across Canada are thrilled to see the return of this great game, and as a matter of fact I’m dusting off my Flames jersey as we speak.
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