The National Hockey League took a significant step toward labor peace with the NHL Players Association by announcing last Friday it won't reopen the current collective bargaining agreement.
Under the terms of the CBA, the league had until Sept. 1 to provide notice of intent to opt out of the current agreement, which expires on Sept. 15, 2022. According to NHL commissioner Gary Bettman, that decision was based on the current state of the game and the business of the game.
Negotiations between the league and the PA have been ongoing throughout the off-season and are expected to continue in the coming weeks. Neither side is tipping its hand but both claim talks were cordial and productive.
— NHLPA (@NHLPA) August 30, 2019
The focus now shifts to the PA, which has until Sept. 15 to use its own early-out option. Following the league's announcement, TSN's Pierre LeBrun reported the PA executive board and other players will meet in Chicago on Wednesday. They're expected to review their negotiations with the league and plot the next move.
If the players vote for the early out, the current CBA will expire in a year. That provides plenty of time for both sides to hammer out a new deal but the possibility of another lockout would provide an unwelcome distraction to the upcoming season.
That's something the NHL brain trust wants to avoid this time around. Sportsnet's Chris Johnston believes the league's decision is a clear indication Bettman and the 31 team owners wish to avoid another protracted squabble with the players over the division of hockey-related revenue.
For the most part, this CBA has worked out for both sides. Escrow, however, is a significant problem area for the players.
As much as 15 percent of the players' salary is withheld from their paychecks and placed in an escrow fund. Depending on league revenue at season's end, they can get it all back with interest. But in most cases, they get back much less than the original deductions.
With both sides keeping mum on the status of negotiations, it's difficult to determine where they are on the escrow issue. Johnston's colleague Elliotte Friedman sounded an optimistic note saying there's believed to be momentum. If they can't reach an agreement by Sept. 15, he believes the two sides will agree to move the PA's deadline to a later date.
The Hockey News' Ken Campbell, meanwhile, reported all indications suggest both sides could decide to extend the PA's deadline by a couple of months, possibly to Jan.1. Campbell also notes an agreement could extend the current CBA by three years. That'll push the expiration date to Sept. 2025 and include some modifications to the current agreement.
Escrow, of course, would be the obvious adjustment. Campbell said the league feels a new U.S. TV agreement, live-streaming and player tracking technology should boost revenue. That would also increase the salary cap and result in lower escrow payments. Nevertheless, both sides might have to work on finding ways to lessen escrow's impact on players' salaries.
Some might wonder why the two sides prefer a three-year extension over a new, long-term CBA. It's likely because both sides want time to see how things shake out with the expected new revenues. Should those streams prove lucrative for both sides, it could perhaps lead to a lengthier extension down the road.
Those new revenues could include the addition of an expansion franchise in Seattle starting in 2021-22. It'll be interesting to see if the PA seeks a cut of the lucrative expansion entry fees. When the Vegas Golden Knights joined the league, those fees were split among the 30 other team owners.
Considering the contentious history between the two sides, negotiations could still go sideways. Nevertheless, there's been a welcome lack of discord between the NHL and PA compared to previous rounds of CBA talks. Should that continue, there's a real chance another lockout can be avoided, perhaps well before the current agreement is due to expire.