The CBA, Issues and Points of Contention Flashcards
What are common bargaining issues in professional sports?
- free agency
- arbitration
- luxury tax
- salary caps (‘cost certainty’)
These issues often revolve around revenue distribution and control within leagues.
What is the players’ view on collective bargaining?
- Salary cap: Why they should help owners from overspending?
- Revenue sharing: Why should they be responsible for small market franchises?
- Free agency: Why can’t they play where they want to?
- Disclosure
This reflects a broader concern about financial management and the implications for player earnings.
What dilemma does the NHLPA face regarding player interests?
- Protecting the interests of a diverse group of players
- Balancing the interests of some players for the greater good
- Managing the financial needs of hundreds of members
This complexity arises from the varied circumstances and needs of players across the league.
What do owners argue about their investments?
Owners believe they deserve the right to make a profit on their multimillion dollar investments
This underscores the conflict between owners and players over financial distribution.
What is the view of the owners?
- Deserve the right to make a profit on their multimillion dollar interests
- Why should they share financial info?
This underscores the conflict between owners and players over financial distribution.
What is the owners dilemma?
- Why should they share revenue?
- Big egos
- 90s expansion/ relocations - too much too soon?
- Need someone (NHLPA) to save them from themselves - the one idiot rule
What were the stumbling blocks for the NHL?
Disclosure, Cooperation amonst clubs
What were the stumbling blocks for the NHLPA?
Poor public relations, lack of trust, owners’ creative accounting
What were the issues for the NHLPA during the 1991-92 strike?
- Reduction in draft rounds
- Free agency for veterans (response to Stevens/Shanahan)
Strike lasted 10 days
The strike was significant in shaping future negotiations and player rights.
What gains did players achieve from the 1991-92 strike?
- Right to use likenesses on trading cards
- Players’ share of card revenues at 68%
- Draft reduced from 12 to 11 rounds
- Unrestricted Free Agency (UFA) at 30 years
These outcomes were crucial in enhancing player rights and revenue opportunities.
What was the duration of the 1994 lockout?
The lockout lasted 103 days and resulted in the loss of 468 games
This lockout highlighted the tensions between owners and players, particularly around financial issues.
What caused the 1994 lockout?
Owners were worried about a mid-season strike, so instead they had a lockout
What was the outcome of the 1994 lockout?
- Owners pushed for hard (payroll) tax system, but withdrew demand on January 10
- Players gave owners “walk away” rights in arbitration
- Cap on rookie salaries (started at $850,000 in 1995)
- Draft reduced from 11 to 9 rounds
- UFA moved up to 32, dropping to 31
Experts claimed a “victory” for owners in 1995
The CBA was extended until ____.
2004
What were the outcomes of the 2005 CBA?
- 6 year agreement with NHLPA option to reopen after 4
- Rollback of salaries by 24%
- Cap set at $39M (54%); minimum $21M
- Minimum salary raised to $450K
- UFA decreased to 27 from 31
- Revenue sharing from top 10 clubs to bottom
These changes marked a significant shift in the financial structure of the league.
What were the owners’ main demands during the 2012-13 lockout?
- Reduce players’ share to 46%
- Set a maximum of 4 years on contracts
- Eliminate front loading of contracts
- Extend entry level contracts to 5 years
- Extend UFA from 7 years to 10
These demands were part of a broader strategy to control costs and manage financial risks.
What is the significance of the 2004 lockout?
It was a pivotal moment leading to a hard salary cap system
The lockout ultimately resulted in significant changes to how player salaries and team revenues were managed.
True or False: The NHLPA’s share of league revenues increases with higher total revenues.
True
This mechanism is designed to ensure that players benefit from the league’s financial growth.
Fill in the blank: The NHLPA’s share will be _____ if league revenues exceed $2.7 billion.
57%
This tiered structure incentivizes both players and owners to increase league revenues.
What was a major concern during the 2004-05 negotiations?
- Establishing a salary cap
- Disagreements on revenue sharing and rollback percentages
These negotiations were critical in determining the financial future of the league.
What are future issues facing the NHL and NHLPA?
- Guaranteed contracts
- Free Agency concerns
- Necessity of arbitration with cap
- Instability within NHLPA
These issues will continue to shape the landscape of professional hockey.
Why did owners was a cap?
Could not get support of large markets for widespread revenue sharing – did so in 2005 only after insisted upon by NHLPA
Differing MRPs leads to salary escalation
System makes teams too dependent on actions of other teams
RUNAWAY PROFITS! If league revenues increase at a rate higher than inflation
Why did players want a luxury tax?
Still allows teams to bid up salaries
A form of revenue sharing for small markets
Curbs salaries by increasing the costs of players in larger markets (Where MRP is higher)
A cap simply guarantees large markets huge profits
Don’t want to give up future profits to owners (runaway profits)
What was the purpose of the 2004 lockout?
A salary cap
What was the CBA in 2005?
6 year agreement w/ NHLPA option to reopen after 4
Rollback of salaries by 24%
Cap set at $39M (54%); minimum $21M
Minimum salary raised substantially to $450K
UFA to decrease to 27 from 31
Teams can take players to arbitration
Draft rounds reduced
Revenue sharing – top 10 clubs to bottom, if meet certain criteria
Why was there a lockout in 2012/13?
Owners wanted to reduce player’s share to 46%, set a minimum of 4 years for contracts (entry level contracts to 5 years), eliminate front loading of contracts, and extend UFA from 7 years to 10.
What was the outcome of the 2012/13 lockout?
- Limit contract extensions to 8 years and 7 on new contracts
- Maximum 50% variation on salaries over terms of a contract
- Player share drops to 50%
