By Jonathon Gatehouse - Thursday, January 10, 2013 - 0 Comments
Three times now, the commissioner has locked out his players. Three times now, he’s delivered a win
For Gary Bettman, one suspects it’s the equivalent of winning the Stanley Cup. That instant when the ultra-competitive commissioner of the National Hockey League finally puts his signature to a new collective bargaining agreement. After months—sometimes years—of preparation, gamesmanship and horse-trading, there’s got to be a fair measure of joy and relief. And more often than his critics and many hockey fans would like, an extra-large helping of triumph. Three times now, since taking over the league in February 1993, Bettman has locked out his players. And three times now, he has delivered his bosses—the 30 team owners—a victory.
On the first go-around, the 103-day shut-down that pared the 1994-95 season down to 48 games, it was just a partial win—limits on rookie salaries and tweaks to free agency. Then at the cost of the entire 2004-05 season, a rout, imposing the toughest salary cap in pro sports and all but destroying the players’ association. And now on the heels of a 113-day lockout that ended with a tentative deal struck in the wee hours of Jan. 6, another big boost to the bank balances of his proprietors: reducing the players’ share of league revenues from 57 per cent to 50 per cent. On the basis of the NHL’s record-setting $3.3-billion 2011-12 season, that’s a transfer of $230 million—the equivalent of a new network TV deal or expansion fee. And over the course of the 10-year agreement, the shift should be worth closer to $3 billion than $2 billion if the business continues to grow at its current clip. Continue…
By Jonathon Gatehouse - Sunday, January 6, 2013 at 2:37 PM - 0 Comments
Jonathon Gatehouse explains why the end of the lockout is hardly a cause for celebration
Even by the diminished standards of sequels, The Lockout 3 was lacking.
The plot was far too familiar. The jeopardy forced. The actors simply going through the motions.
So while it’s a relief that the NHL and its Players’ Association have finally come to their senses, resolving a labour dispute that never had to happen after 113 days, it’s hardly cause for celebration. The tentative deal, struck in the wee hours of Jan. 6, isn’t that much different than the one the league and Commissioner Gary Bettman haughtily walked away from a month ago. Nor, is it greatly changed from the solution the two sides might have drawn up over beers at the cottage last summer: A 50/50 split of revenues—just like the NBA and NFL have. A 10-year term, with both sides enjoying an opt-out provision after eight years. (The deal that expired on Sept. 15 ran for seven.) A salary cap of $64.3 million for the 2013-14 season, and a floor at $44.3 million (down from this year’s projected $70 million/$54 million ceiling and floor under the old agreement.) The players get $300 million of “make whole” money to help ease the transition to the lower revenue split. Bettman gets a 7-year limit on free-agent contracts—eight if the player resigns with his current team—and limits on how much compensation can vary from year-to-year as part of his efforts to stop his owners from signing stars to ridiculously lengthy contracts for stupid money. (Although none of that will stop GMs from making disasterously bad decisions. Just ask any Montreal fan about Scott Gomez.) Rich club to poor club revenue sharing increases to $200 million a season—or five Phoenix Coyotes if you rather—with the promise of more as the bottom line improves.
But none of this is earth-shattering, or even vaguely transformative. All of it, incremental gains and losses to the existing system. The kind of “tweaks” Bettman talked up over the last season or two before he shuttered the league yet again last Sept. 15.
So who’s to blame? You can argue it’s the Commissioner, but really he was just doing his job as the front man for the owners’ baser instincts. Is it Don Fehr, looking to tack on a career-ending victory over the NHL’s small fry to his real legacy—a two-decade beatdown of the infinitely richer and more powerful men who control Major League Baseball? Hardly. He was just doing what the players wanted.
Nope, it’s the fault of the media and the fans. Particularly those of us here in Canada, which provides the NHL with one-third of its revenue, half its players, and most of its passion. As the old saw goes, those who do not learn from history and doomed to repeat it. Again and again.
As I outlined in my book, the great lesson the NHL and its players learned from the 103-day lockout in 1994/95, and the debacle that was the lost 2004-05 season, was that the market wouldn’t punish them. Sure, there was the odd team that took a short-term drop at the gate, but on both occasions, fan anger dissipated like morning fog on a sunny day. The media transitioned effortlessly from outraged columns and phoney phooey-on-hockey sentiment to season previews and training camp news. And the business bounced back stronger than ever.
And so it will be this time. The NHL and the NHLPA will indulge in the hockey equivalent of morning-after flowers, maybe a “Thank-You Fans” message etched onto centre ice, and some new charitable endeavours. The antsy sponsors will finally get to air those feel-good commercials they’ve had sitting in the can since last summer. And by the start of the playoffs, all this unpleasantness will have been forgotten.
The thing is that without a real, sustained fan backlash—like the one baseball owners and players experienced after the cancellation of the 1994 World Series—there is nothing to stop it happening again when this CBA expires after the 2019-20 season, or should it run its full course, 2021-22.
Of course, even that’s not an original thought. Many others wrote the same thing in early 1995, and then again a decade later.
Pro-hockey’s fans have become the league’s enablers. Just like the filmgoers who flock to theatres to watch the latest iteration of a once mildly funny comedy, or clapped-out superhero franchise.
That’s unlikely to change. But it’s something to keep in mind when you find yourself complaining about The Lockout 4.
By Jonathon Gatehouse - Thursday, October 25, 2012 at 3:47 PM - 0 Comments
While the league and its players sweat the small stuff, the NHL wastes its potential
For once, everything seemed to be going the NHL’s way. The league had clinched a hefty new TV contract with a big U.S. network. A major-market American team captured the Stanley Cup, creating lots of buzz. Blue-chip companies were lining up to sign sponsorship deals. And revenues were at an all-time high. Then the owners and Gary Bettman got together and locked out the players.
Of course, that was back in 1994. A fleeting moment when hockey seemed poised to break through into the American sporting mainstream, which ended up being washed away by months of bad press and cancelled games. That damage was only exacerbated when the owners again locked out their employees a decade later in an even more rancorous dispute, becoming the first—and so far only—pro sport to scuttle an entire season. In fact, in many ways, it’s taken 18 years for the NHL to get back to where it once was. And now, on the heels of last year’s landmark TV deal with NBC, in the wake of the L.A. Kings’ cup victory in June and after seven straight years of record revenues, the league again seems intent on skating backwards. Unable—or unwilling—to come to terms with the players on a new contract as “Lockout III” enters its sixth stultifying week. It is, as the saying goes, déjà vu all over again.
The fans are angry. But maybe the more appropriate response is sorrow. Sadness that those who run the game, and those who play it, can’t break a cycle that continually wastes its potential.
By Jonathon Gatehouse - Monday, September 24, 2012 at 11:43 AM - 0 Comments
In conversation with Jonathon Gatehouse
For hockey fans, there’s something depressingly familiar about the current battle between the National Hockey League and its players. The lockout, which began at the stroke of midnight on Sept. 15, is the third in the past 18 years, all of them overseen by commissioner Gary Bettman. And the issue is the same as it ever was: money. In fact, the only significant difference this time around might be who is leading the players. Donald Fehr, the new executive director of the NHL Players’ Association, led pro baseball’s union for a quarter of a century, before riding to the rescue of his defeated and demoralized hockey brethren. Tough and determined, he’s every bit as stubborn as the man he’s facing across the table.
Q: In the run-up to the lockout, there have been proposals, counter-proposals, and a lot of numbers thrown around. Just how far apart are the league and the players?
A: It comes down to this. The players made enormous concessions in the last lockout, and took a 25 per cent salary reduction, which worked out to more than $3 billion over the life of the agreement. And the league has experienced seven straight years of record revenue growth. So then we came into bargaining, and the owners’ initial proposal called for another 24 per cent reduction, or $450 million a year, assuming revenues never grow. It was way over the top, and way outside the bounds. The equivalent from the players would have been for us to say we want 71 per cent of all hockey-related revenues (HRR). So now the owners have said they only want a reduction of 17.5 per cent, and that they’ll phase it in a little bit, but it’s still well over $300 million a year. So we’re hundreds of millions of dollars apart on compensation.
By Jonathon Gatehouse - Thursday, September 13, 2012 at 5:00 AM - 0 Comments
The NHL commissioner brought hockey to its knees, twice. Get ready for the third period.
As talks between the NHL and its players’ association over a new collective bargaining agreement sputter and the owner-imposed Sept. 15 deadline looms, another hockey lockout seems all but certain. It will be the sport’s third work stoppage in the past 18 years, although the issues are the same as always: “money and envy,” writes Jonathon Gatehouse in The Instigator: How Gary Bettman Remade the League and Changed the Game Forever. After winning the toughest salary cap in all of pro sports the last time around, team owners are now pushing for further gains—redefining what counts as revenue, limiting the length of contracts and, above all, reducing the players’ share of the pie. Despite record revenues of $3.3 billion last season, the men who run the game claim that the economics of hockey still don’t work. Donald Fehr, the new executive director of the NHLPA and the man who crushed the resolve of Major League Baseball owners, is openly skeptical. And the issues are so complex that they may well take months to negotiate—once the two sides return to the table. Bettman, who will celebrate his 20th anniversary in the NHL’s top job this winter, is facing a formidable foe. But the commissioner shouldn’t be underestimated. Now the single most powerful figure in the history of pro hockey, he’s a man who drew some sharp lessons from his rocky start in the job. And when push comes to shove, he’s more than capable of dealing them out too. Fans trying to make sense of the present dispute best look back at what really happened in 1994 and 2005.
As 1994’s training camps wound down and the league’s deadline loomed, the players began to chafe. And the message they decided to send out to NHL fans across North America was anything but subtle. In Montreal, Habs defenceman Mathieu Schneider skated onto the ice for practice with a piece of white stick tape plastered to the front of his helmet on which he’d scrawled the words Bettman sucks. Joe Sakic, the quiet young captain of the Quebec Nordiques, suggested the new commissioner “knows nothing about hockey and doesn’t care.” Cam Neely, sitting in the Boston dressing room in his long underwear and an NHLPA ball cap, predicted a dire future for any league that would dare to lock out its players: “They’re not shooting themselves in the foot, they’re shooting themselves in the head as far as I’m concerned.” And even Wayne Gretzky, a man so averse to controversy that he invited Alan Thicke to emcee his wedding, weighed in. Wearing a suit, tie and sour face, he met the media at the LA Kings’ practice facility to make it clear that if the season didn’t start on time, there would only be one man to blame. “I’ve played this game for 30 years, and for someone to come along who has only been in our sport for one year and tell us that we’re not going to play is very frustrating and extremely disappointing,” the Great One said. “I’ve worked too damn hard to help push our sport … Hopefully it doesn’t all come down because one person wants to change the format.”
By Colby Cosh - Thursday, August 23, 2012 at 4:02 PM - 0 Comments
When the National Hockey League locked out its players for the entirety of the 2004-05 season, there was no competition held for the Stanley Cup. To this day, almost nobody ever talks about how bizarre this was—how bizarre, I mean, that the Canadian people and their officialdom stood for it. The precise legal status of the Stanley Cup is a lot like an unobserved particle in quantum physics: it is an unknowable, an existential question that has absolutely no good answer until and unless somebody with judicial authority chooses an arbitrary criterion and applies it. But as for moral ownership of the Stanley Cup… there cannot be any reasonable doubt about this, can there?
The Cup was originally a gift of the viceroy to the people of Canada. It is sacred to the people of Canada, and only to them. As the National Hockey League came to be recognized as the world’s supreme hockey competition in the 1920s, the people of Canada came to accept that the NHL’s champion, even when it was an American team, should receive the Cup. We have forgotten that this was a matter of generosity on our part: that the NHL does not own the Stanley Cup, but is suffered to award it only in exchange for operating the best continuing hockey competition for Canadian audiences.
It is astonishing that we should tolerate the use of our Stanley Cup as a hostage to one side in a labour negotiation. This happened once, and we regretted it passively, snivellingly, instead of demanding action. We can manage a half-decent riot when a Canadian team loses the Stanley Cup in a fair fight. But for some reason, when the Cup is openly confiscated by billionaires, dangled in front of young Canadian hockey players and mothballed when they refuse to give back a piece of their paycheques, we do nothing but mope.
And now it might happen again, you say? Continue…
By Colby Cosh - Tuesday, August 10, 2010 at 6:08 AM - 0 Comments
“The grievance is denied.” That’s the concluding sentence of arbitrator Richard Bloch’s Monday ruling on the 17-year $102-million contract Ilya Kovalchuk signed with the NHL’s New Jersey Devils last month. When the NHL deregistered the contract, whose terms would have seen New Jersey pay Kovalchuk 97% of the total amount in the first 11 years of the deal, the Players’ Association naturally objected.
Sure, the NHLPA argued, there were years tacked onto the far end of the deal that neither Kovalchuk nor New Jersey expect the player to be in the NHL for. Those years are priced below the likely league minimum, and are obviously in the contract for the sole purpose of lowering Kovalchuk’s average salary-cap hit in the present. But what of it? Nothing in the Collective Bargaining Agreement between the league and the PA specifically forbids this behaviour, and several similar “backdive” deals, though less extreme in every respect, have already been registered by the NHL and played under.
Bloch rejected this argument, granting a clear outright win to the league. The CBA contains a general “anti-circumvention” provision, but the guidance offered by that provision was less than clear:
No Club or Player shall enter into any Player Contract, Offer Sheet or other agreement that includes any terms which are designed to serve the purpose of defeating or circumventing the intention of the parties as reflected by the provisions of this Agreement, including without limitation, provisions with respect to the Entry Level System or Restricted Free Agency. However, any conduct permitted by this Agreement shall not be considered to be a violation of this provision.
Now that’s an odd paragraph, wouldn’t you say? Because there is no rule in the CBA that would in itself forbid the Kovalchuk deal, the NHLPA leaned on that last sentence, which basically says “anything permitted by this agreement is permitted by this agreement” and seems, in its plainest reading, to deprive the first sentence of all its potential force. Well, hell, no arbitrator’s going to go along with that—i.e., to read a paragraph completely out of a contract prepared and vetted by professionals representing both parties, as if he were physically Liquid Paper-ing it out of the document.
Bloch had little choice but to conclude that there must be some reason for a general anti-circumvention rule—and that reason, he concluded, was to allow the league to block contracts like Kovalchuk’s, which violate the spirit of the CBA rather than its letter. Nothing specific about Kovalchuk’s contract—the amount, the end date, the degree of frontloading—is forbidden by the agreement, Bloch conceded. Perhaps no single factor is even unique to it. But, taken together, the components have a vague tendency to offend the “no circumvention” concept. Supposedly.
Bloch’s decision includes an observation that is, after all, very hard to disagree with: “A contract term covering a Player’s NHL services to age 70…is not expressly prohibited by the CBA. But the parties to that SPC may not reasonably be found to be seriously anticipating its fulfillment.” Bloch would have created a serious problem for the NHL if he had found the anti-circumvention sections of the CBA to be meaningless. If he had ruled in favour of the NHLPA, you can bet your last nickel that someone would have been signing one of those age-70 contracts in July 2011. Or even sooner.
But Bloch has created a serious problem, too: as a consequence of his ruling in defence of the CBA’s spirit, it is no longer clear exactly which frontloaded contracts are kosher and which are treyf. Kovalchuk and the Devils returned to the negotiating table Monday night in an attempt to save the contract by tinkering with the math. What principles ought to guide them? What changes must they make to render the contract acceptable in the eyes of another arbitrator—one who wouldn’t even be Richard Bloch? (The NHL and the Players hire arbitrators for the duration of only one grievance; experience in the sporting world has shown that owners will inevitably and instantly fire any “permanent” arbiter who rules against them.)
Bloch hasn’t really said what kind of deal meets the no-circumvention test. He didn’t even give the parties the reassurance that existing frontloaded contracts are definitely legal and could be safely imitated. In fact, he specifically said the opposite. Which puts the league under no apparent obligation to even treat like contracts equally, or two different teams consistently. All that the Devils and Kovalchuk can really do here is to seek Commissioner Bettman’s advice in advance of signing, or make another deal and cross their fingers that either the Commissioner will like it or the next arbitrator will uphold it.
The Collective Bargaining Agreement doesn’t appear to offer the team and the player any freedom to sign a contract without some degree of league interference—which raises the question, what good is the CBA at all if we’re going to have a “Bettman decides everything” system? (And, more particularly, how did the Players’ Association get manoeuvred into signing an agreement that doesn’t protect its rights very effectively?)
By Charlie Gillis - Tuesday, June 17, 2008 at 2:36 PM - 0 Comments
Actually, there are worse people than Glenn Healy to serve as director of player…
Actually, there are worse people than Glenn Healy to serve as director of player affairs for the NHLPA. Given the association’s track record (see: Eagleson, Alan; Saskin, Ted) it’s safe to assume they interviewed all of them.
So what does this mean to those of us who make less than $1.1 million per annum and still use wooden sticks? Well, presumably a guy can’t represent the players whilst trashing them as enthusiastically as Healy has been known to as a commentator for TSN.
Which is too bad. The guy was starting to grow on us.