Lock-out Talks: Where are we Now?

Updated: December 18, 2012 at 9:09 am by Kent Wilson


Another day, another round of lock-out links and negotiation items. The World Junoir championships will soon arrive and with them some relief from the hockey-less-ness and legal navel gazing that has plagued us since October. For now, though, let’s concentrate on the on-going rich man slap fight.

Disclaimer of interest

We talked about the NHLPA’s threat of decertification (what’s now being referred to as “disclaimer of interest”) a few weeks ago when it started to become clear the two sides weren’t really getting anywhere. In the battle of exceptionally wealthy men with diversified finances and a eye on the long-term bottom line versus a conglomerate of disparate hockey players who lose and risk more with every passing game, it was clear the league held most of the leverage in the negotiations. 

The PA’s ace up the sleeve was decertification, a nuclear option that would disband the union, nullify collective bargaining and potentially expose the league to anti-trust lawsuits. 

Bettman and company made a pre-emptive strike against such an action recently, filing a suit in New York seeking to essentially declare any move to decertify or disband the union as a bad faith negotiating tactic on the part of the PA, which would potentially shield the league from any sort of anti-trust actions. Tyler Dellow has more on the legal nitty-gritty of the league’s suit here and here

If you click through the first link, you’ll find evidence the league has actually been building this obstacle for some time, no doubt prepped by the action of NBAPA last year as well as some of the talk by players and hockey media over the last month or two.

If Bettman and the league succeed in their bid to more or less bind the players to their union and the CBA talks, they will effectively cut the last leg from under the PA. Aside from continuing the current game of chicken, in which each side tries to wait out the other while staging ever more ridiculous PR stunts in front of the media, the players won’t have any other cards to play. Their options would fall to capitulation on the current contentious issues (5 year contract caps, 10 year CBA, etc.) or killing the season in an effort to score at least some sort of pyrric victory over the owners. 

The league’s lawsuit hasn’t deterred the players from moving forward with a disclaimer of interest, however. As we speak, the PA is voting en masse on the subject: a two-thirds majority will give the PA’s executive board the required support to file the disclaimer, which would have to be done by January 2. 

What it Means

The effect these things will have on negotiations and the NHL season depends on a number fo factors. Primary amongst them is whether the league’s move to block the union’s dissolution/anti-trust litigation is successful or not. As mentioned, that would put a knife in the heart of the union’s last, best maneuver and likely give the owners the leverage they need to beat the players into submission.

On the other hand, if the NHL’s suit fails and the union is allowed to pursue its planned course of disbanding, then one of two things happens:

1.) It scares the owners enough to get them back to the negotiating table and to stop talking about “take or leave it” proposals or “hills they will die on”. This is more or less what happened in the NBA talks when the basketball players sought decertification. Talks went into overdrive as soon as the motion was passed by the union and the NBA had a new CBA about two weeks later.

2.) The PA really does dissolve and the two sides decide to duke it out in court. The players would have to argue that the league’s lockout is illegal under anti-trust laws in the States and NHL would face a brave new world in terms of player compensation, free agency, etc.

It’s impossible to plot the course of the NHL if #2 is the route these things take. The lock-out could be stricken down as illegal and the previous compensatory rules/contracts/salary cap under the last CBA would likely go away, resulting in a free agent free-for-all across the board. GM’s in New York, Montreal, Philadelphia, Chicago and Toronto would be thrilled, existing rosters would be thrown into total disarray and nobody would be quite certain how clubs like Coyotes or the Islanders would compete for talent.

Many of the games stars would make out like bandits under a completely free market no doubt. There’s a view that third and fourth line players would suddenly be battling for scraps, but Im not certain that would necessarily be true – as NHL GM’s have proven time and again, they have no problem voting up even nominal talent in the league. After all, there are only so many roster spots and so many people in the world who can ably fill them. If I was to guess, stars and superstars would get more expensive and most of the support guys would at least run in place compensation wise (although a Bobby Holik at $9M/yer would occassionally pop up as well).

The players share would likely approach the 70-75% of HRR like it did previously and the league would be severely stratified between the “haves” and “have nots”. 

Which is why most owners outside of NY and Toronto rightfully fear the end of the union and CBA. Collective bargaining makes things like the salary cap, entry-level contracts and contract caps possible. Without it, it’s a player-by-player negotiation and a competition across teams to acquire the best talent by any means necessary.

Moving Forward

The CBA talks are stalled while the PA votes on the disclaimer of interest. Once the outcome of the vote is revealed, we’ll know whether the PA intends to dissolve the union and whether it is allowed to pursue anti-trust litigation. As mentioned, if the disclaimer is shot down or the anti-trust pathway blocked, it could lead to a quick resolution with the owners getting more or less everything they want. On the other hand, if the union votes to disclaim interest and the league’s move to render their anti-trust strategy illegal fails, the league and owners will have a powerful new incentive to salvage negotiations.

Those are the “best” outcomes from the perspective of having an NHL season this year. On the other hand, even if the PA is disallowed their anti-trust move the PA could dig in for a long fight, with the new goal being to break the cyce of lock-outs by making this one as painful for the league as possible. Conversely, the players could decertify, take the league to court and the ensuing battle could tie things up indefinitely.

From a wider view, one wonders just how much damage either side is willing to inflict on the league and the brand in order to win this battle. At some point the dollars either side is fighting over begin to pale in comparison to the future earnings they are flushing away by alienating fans and sponsors alike. I’m not sure we’ve crossed that particular Rubicon yet in these talks, but it could be fast approaching.

The MLB spent nearly a decade trying to repair the league’s image and relationship with fans after their last work stoppage in 93/94 – and that sort of sustained fan anger/apathy may be the only outcome that will ultimately deter similarly acrimonious labor relations in the future.