Can the Players Rid Themselves of Escrow and the Triple Hard Salary Cap? Maybe. But Remember, the Lord Only Helps Those (Players) Who Are Willing to Help Themselves!!

“For nearly two decades, the Players have protected the owners’ income with escrow, including throughout this pandemic crisis, even as owners’ equity continues to grow exponentially. It is time to fix the escrow.”

 Artemi Panarin, New York Rangers

 

 “A. escrow and B. escrow”

Jonathan Toews told the CBC, when asked the biggest issues in the coming (2019 CBA) negotiations.  No changes to escrow were made.

 

Introduction

It is clear that the Players hate the hard salary cap/escrow system, but the NHLPA has not been able to deliver any changes to the system since 2006 when it was forced on the Players, despite numerous opportunities to do so.  In fact, in 2012 the Players were locked out by the Owners for half a season and had their salaries cut a further 12%!! From previous blogs, we have also learned that that:

 

1. since the Escrow Balance owed by the Players at the end of the 25/26 season will still be in excess of $600 million, the NHL will likely lock out the Players until they agree to accept less than a 50% share of HRR, 
2. it would be irrational for Players to try and endure a lockout or strike over a five percentage point decrease or increase in the Players’ Share of HRR, and
3. from now until the end of the 25/26 season and due to the 'frozen' salary cap, those Players who need to negotiate new contracts will get squeezed on compensation, or may even lose their roster spots altogether to cheaper, younger Players.

 

For a Player, missing a significant portion of his few prime earning years due to a lockout or strike has a huge impact, and the return is insignificant.   But for the Owners, enduring a work stoppage has almost no impact. During any work stoppage, whether by lockout or players strike, the Owners pay the Players nothing, cut non-Player expenses ‘to the bone’, continue collecting their TV rights fees revenue, and still operate their arenas and other ancillary businesses profitably. 

 

Players have no bargaining power at all……..none! That said, if Players are content to continue with Gary’s triple hard cap, that is a choice they are free to make. But if they are not, then it is time for Players to stop dreaming that, like magic, a time will come when the NHL will agree to soften Gary’s triple hard cap………..that is unless the Players are willing to strike at the end of the 25/26 season for two whole seasons.  Not gonna happen!!!

 

So how can Players help themselves without having to strike for two years?  There is only one way.

 

The Decertification Option

 

If the Players want to rid themselves of Gary’s triple hard cap, they can consider decertifying the NHLPA as the sole bargaining agent of the Players before the start of the 22/23 season. 

 

Players Should Commission an Independent Study of Decertification

 

In order to properly consider the decertification option and whether it makes sense for the Players, the Executive Board (i.e. the Player Reps) should commission a proper and thorough independent study with a view to assessing both the pros and the cons.  After studying the report, the Player Reps could make appropriate recommendations to the Players. The actual report should be made available to each of the Players, so that each Player who wants to can seek objective independent advice on its contents.  Then, if the Players want, there can be a full Player vote on the question of whether or not to decertify.

 

Decertification Needs a Majority Vote Only

 

The Players’ can decertify the NHLPA as their sole bargaining agent by a 50% vote any time during the annual three month window from June 15 to September 15. 

It is important to note that, any time prior to an actual decertification, the NHL can always choose to make a unilateral offer to amend the current CBA to something acceptable to the Players.  For example the NHL can propose a new system with no salary cap or escrow deductions, but which instead allows for meaningful revenue sharing and some kind of luxury tax among the Owners.  In such an event, the Players could simply vote to ratify a new revenue sharing/luxury tax system to replace Gary’s triple hard cap instead of decertifying the NHLPA.

 

 

What Happens if the NHLPA is Decertified??

 

It is important to understand that decertifying the union does not mean that the NHLPA would dissolve and cease to exist. A decertified NHLPA would continue to operate as a trade association, and would still be able to carry out most of their important Player service functions.

 

Upon decertification, the current CBA would be void, and all Players would immediately become unrestricted free agents (UFAs) with no salary cap whatsoever. All Players would negotiate new contracts with a Team of their choice, and continue to play. They would no longer be subject to the restrictions of the rigged collective bargaining system that has been imposed on them by the Owners,— restrictions that are violations of federal antitrust law.  For example there would be no more:

 

1. League wide salary caps,
2. team salary caps,
3. maximum player salaries,
4. contract term limits,
5. amateur drafts; or
6. any other restrictions that allow the Owners to treat Players as their personal property.

 

 

In my next column, we will take a far more detailed look at what the world will look like to both the Players and to the NHL if the NHLPA is decertified.  It is not at all what you might expect the world to look like!

 

See you next week…….