Worth Resolving

See, there really is nothing for either side in this fight.

Having teams cook up bizarre, front-loaded contracts that whittle down to $50 a season in the 45th year doesn't help NHL players in general. It may help teams like Chicago win the Stanley Cup, but the vast majority of NHL clubs don't benefit from these kind of deals that most GMs see as a form of cheating.

Everybody knows how much money is on the table for the players. It's set out in the collective bargaining agreement. It's just a question of how its divvied up. The more Ilya Kovalchuk gets, the less somebody else gets, or at least the bigger the escrow cut that comes the way of the average NHL player.

So if the NHL and the NHL Players Association are really using the 48-hour extension in the Kovalchuk decision to hammer out some kind of mid-CBA agreement on how to handle these deals, it's probably a good thing for everybody. Well, everybody except maybe Kovalchuk. And a few others.

Larry Brooks of the New York Post delivered an intriguing scoop late Wednesday night in which he reported that the league has offered to approve the newest Kovalchuk contract with the New Jersey Devils, and stop threatening to invalidate a few other similar deals, if the union agrees to some new rules that will make these kinds of contracts less attractive to teams in the future.

Brooks also reported that if the PA doesn't agree to these terms by 5 p.m. on Friday, commissioner Gary Bettman will reject the Kovalchuk deal, invalid Roberto Luongo's new contract with the Vancouver Canucks and hold a more formal probe into Marian Hossa's contract with the Blackhawks.

This is some heavy poker.

It's a tough fight for the union, particularly given the fact it doesn't have a leader. Moreover, 80 per cent of the players in the league don't benefit from these kinds of contracts. In fact, through the escrow system, you could argue these deals are under-written by the vast majority of players.

That said, there's pride on the line here. If the union agrees to these conditions with two years still to go on the existing CBA, it's essentially allowing clawbacks in the middle of a contract. 

The league, meanwhile, would still be under the gun to deliver some form of punishment to the Devils for attempting to circumvent the salary cap in the first place. If Bettman can cut a deal with the players union now, and then chooses to let the Devils off the hook, he'll have some explaining to do to about 20 other franchises.

Lots to look for in the next 48 hours. 

 

Comments

[John Carss]

I'm still confused as to why the Devils are punished for going too far when they were just the latest team to try this method of contract negotiation.

[drewr15]

I don't understand this continuing to focus on the escrow part when the bigger picture you miss is how many players will get better NHL salaries because all of the money is not going to the high priced players so there is more money for the middle of the road guys. The less Kovalchuk's salary hit is, the more another player gets in straight salary. There are two sides to the coin.

[Joseph Ierfino]

The reason the Loophole was left open in terms of allowing the average of the salry over the life of the contract is so smaller market teams could get over the cap floor while spending under it. A team like pheonix would love to get a kovalchuk making 1 mil in the final years of his contract and take the 6 million cap hit. They could have a 25 million dollar payroll with a cap hit of 43 million.

[mark]

I don't agree with Bettman on much, but in this case what he and the NHL are doing is bang on. I think over time these contracts will basically erode the "middle class" in the NHL. I think this would lead to more European players opting to play in Europe. Eventually you would be left with a league where each team has one or two 'elite' players with a whole bunch of less skilled interchangeable parts filling out the ranks. Not good for the average player, the league or the fans.

[Stephen]

The “pride” factor is always the problem in these types of negotiations. The NHLPA would be worried about the impression that agreeing to a deal would create – even though it would be in the best interest of the vast majority of their members. How’s this…let Bettman disapprove the contract along with all of the similarly structured deals (Luongo, Hossa, etc.) and “punish” each of the offending teams with a minimal fine ($10,000)? Let Bettman and the NHL be the bad guys. They wouldn’t mind and everybody but 4 or 5 players and their agents win. There don’t need to be any “new rules.” Just like when the NHL started calling hooking, you don’t need to rewrite the rules just apply a standard of enforcement that complies with the originally intended purpose of the rule.

[Yukon]

Because they went too far this time. The NHL should have blocked some of the other contracts but turned a blind eye. With this one they couldent.

[James Jack]

Well this is just one more situation where a hockey team is more than just one player. We suffered it for years where Mats got most of the money and we got nothing in terms of a championship. I think its about time we let lots of these players get to the KHL and the NHL not only placed caps on team salary but also on individual salary. We want a league where a team can be built and stay together for a period of time so that we can get behind them.

[Bron]

My offer to solve problem:

Contract can’t deviate more than 40% from average that hit salary cap (% could be negotiated with NHLPA) in any side in any year.

In Kovalchuk case for example:

Average for 15 year contract of $6.66 mln:

max salary will be 6.66 + 2.664 = 9.324 $mln

min salary will be 6.66 – 2.664 = 3.996 $mln

Therefore no necessity to restrict length of the contract

[John]

The NHL is a joke. They should have nipped this kinda of contract in the bud back when the first few were being signed years ago. Now its turned into a circus and the NHL is looking like a bunch of idiots once again. I have no respect for this league as long as gary bettman is calling the shots.

[KD]

I'm on the Devils' side on this one, even on the original contract. Bettman pushed hard for a cap that he and a select group of owners wanted. A few teams found a way around it that was technically legal, though it may have violated the spirit of the agreement. Bettman's mad because someone (Lamorello, this time) outsmarted him and he has to get even. This isn't a battle about the cap or the lenghth of the contract. It's a battle to save Buttman's ego and pride.

[Werner Ott]

I've never figured out why teams decide to sign a player for 10-15 years, when they know his "best-before" date is probably over in 5-odd years. It's an albatross on a team's payroll and salary cap for those years, and it renders a player pretty well unmovable with that salary anchor attached to him.
I know that they're paying him the majority of the salary in the first few years, but having to pay a guy a million or so for the next decade and a half....?

[cy]

bottom line: Bettman should be fired

[Cartman1]

Because the Devils tried to blatantly circumvent the cap. The other contracts were controversial but not so bad as the Kovalchuk one. If NHL approved the Devils deal than well how could they refute any future contracts. NHL said enough is enough and are playing hardball now.
-
This is how the NHL should work w. respect to salaries:
cap: $50 million
roster size: 24 players
avg: $2.083 million
max salary: $5 million with three exceptions.
1) defenseman max $7 million
2) forward max $10 million
3) goalie max $8 million
(that works out to half the cap on 3 players)
--
no contracts can be longer than 5 years.
--
I see the problem with this obviously other leagues outbidding on players - KHL / Europe Super elite leagues etc. and than we have the WHL problem all over again.
HOWEVER,
This would get rid of the Europeans who dont want to play here get rid of players that want the almighty dollar only.
--
I dont think with the talent we have in Canada and the upcoming US it would be difficult to support a 24 team league.
--
this also means getting rid of a few teams this is my list of candidates:
Carolina
Atlanta
Tampa Bay
Florida
Anaheim
San Jose
Nashville
Columbus
Phoenix
--
I would also move a few teams into Canada - Winnipeg needs a team. Quebec needs a team and I think one more team in Ontario could well be supported.
--
And re: NHL players in Sochi(?) not a chance.
too many risks involved.

[Arhtur Bailey]

I don't think the Devils should be penalized. What did they do? Circumvent the spirit of the law by using the letter of the law? honestly, I think the arbitrator got it way wrong and the original Kovalchuk deal with NJ should stand.

And was it not suggested in this corner that Lou Lamoriello who helped implement the Salary Cap negotiated the outrageous (but IMHO still legal) contract to force the NHL to put an end to this type of deal (the implication being Bettman was on board)? Are you dismissing this concept now?

[RA]

Who is representing the players union anyway. There are maybe 20 players in the NHL that can command a 10 year plus contract. The last CBA should have allowed a max year cap whithout the majority objecting which would have prevented all of these rediculous contracts.

[goodyr67was]

"It's set out in the collective bargaining agreement. It's just a question of how its divvied up. The more Ilya Kovalchuk gets, the less somebody else gets, or at least the bigger the escrow cut that comes the way of the average NHL player."
-----------

hey drewr15, try reading the article before wondering aloud with befuzzlement...

[Leafs will win a cup]

To the 2 that mentioned Kovalchuk playing for 1 mil per year in the final years of his contract, I don't think that was the intent. The intent was that he would be retired and thus there is no cap hit, and no kovalchuk but the Devils would have paid him much higher than the 6 million cap hit for the first part of his contract.

[Kevin]

What they could do to solve this is to allow every team one "marquee" player who's salary is exempt from both the cap and floor calculations. The catch - if that player is traded, the receiving team doesn't get to have both that player and their own marquee player exempt from the cap rules. Teams wouldn't be required to have a marquee player, so the ones that can't afford it aren't forced to spend extra.

[Chris]

The simplest solution is to make any contract longer than five years have a cap hit that is based on the average of the five most lucrative years. Teams could still sign guys to fifteen year deals; we'd just see who ACTUALLY believes their star player will play the contract out. In Kovalchuck's case the cap hit would be ten million instead of six million. Jersey would have zero argument; they can't justify wanting a lower cap hit to get them under the cap because of money allocated to other players because that constitutes salary circumvention. Bottom line is that if you really think a player is worth eleven mil per year, your cap situation should reflect your faith.

[Kevin]

To "Leafs will win a cup" - I could be mistaken, but I believe that because of Kovi's age at the end of the contract, even if he retires, the cap hit remains for the length of the contract. Of course, at 15 or 17 years, that's several CBAs away, and who knows what the rules will be by then...

[drewr15]

Hey goodyr67 - I did read the article - maybe you should try reading what I wrote. my point was that he keeps focusing on the escrow players are losing from the Kovalchuk contract but fails to focus on the fact that if kovalchuks cap hit is only 6.66m - then the Devils can sign some older players like Mottau and McAmmond for a fair salary to keep depth - if Kovalchuks cap hit was 8m - then those jobs are going to base level salary rookies and Mottau and McAmmond are probably retiring or running around begging a team for a tryout. There are two sides to the story about what the lower cap hit does but people blinded by their agenda only focus on the one side. Thanks for keeping your blinders on.

[DJ]

Personnally... the Idea of the AVERAGE cap hit, is the cause of the issue. I say make the cap hit be on the true value of the contract that particular year. Allow teams to work with players to forcast out their budgets and vary them. So if a user gets paid 9 million in year 2-5 then thats the hit on those years. teams need to be more fiscally responsable withere budgets....

[Paul]

For the good of the NHL game, Count Bettman has gotta go. On the other hand, I can't say I'll shed a tear for these millionaire hockey players if they only get $2 million per season versus $7 million or what have you.

[neumann103]

I just don't get how anyone can support the League on this.

Yes these contracts are ridiculous. Yes, they are a clever strategy to circumvent the salary cap. Yes, they take money from other players in the zero sum game of the salary cap.

But they are valid under the terms of the CBA. The CBA that the NHL owners in the Bettman fan club wanted and achieved through a league staged lockout. They killed a season and got what they wanted and now they want to renegotiate in the middle of the term? The NHL wants a do-over? The same people who think that a contract that adheres to all the rules is invalid want the arbitrary right to renegotiate a contract (the CBA) whenever they feel like it.

And on top of this they want to invalidate contracts that are already in their second year?

Seriously?

The next CBA negotiations will be a sick joke. The League will have some insane vendetta and the players will eventually implode, and fans will be so distracted by the outrage over greed of players making a million dollars to do something we would all pay to do.

There are some completely reasonable steps to take in the next CBA.
Limit contract terms. 10 years, 5 years, whatever. No biggie. A completely succinct and objective metric.
A soft cap imposed by by an tax on overage. Tax a team an amount for every dollar over the cap and pay into a fund distributed to the other teams (or if you want to incentivize even more redistribute the money to ONLY the teams that are under the cap). If the Rangers or the Red Wings want to pay whatever it takes let them just get something of it for players, for lame teams that underpay etc. You could set the cap at $50M and if the Leafs want to incur a payroll of $80M in a doomed and hopeless bid to not suck, then they have to pay $30M into a pool distributed to the teams under the cap.

Bettman is terrible. It is a miracle that he is gainfully employed. Nothing could improve the NHL as quickly or as much as his termination and replacement by someone not an idiot (rules out Bill Daly).