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Will NHL players actually get their money’s worth after lockout?

Greg Wyshynski
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Zach Parise has been candid about his disdain for Gary Bettman and the NHL's stance in their CBA negotiations, dropping lines about Bettman like, "He really loves his lockouts."

As he said to the Minneapolis Star Tribune:

"You hope it doesn't go too long, but it's tough to grasp when you've got a guy in Gary Bettman bragging every year that we're making 'record revenue, record revenue, record this,' and all of a sudden they want to take a quarter of what you've made away. That doesn't make sense to anybody. It doesn't matter what industry you're in."

Taking "a quarter" of what the players are making is, at this point, intentional hyperbole, unless you actually believe the league's first offer — a giant, pulsating middle finger to the NHLPA and a "come at me, bro" declaration by Bettman to Fehr — was a legitimate one. The most recent NHL offer doesn't come close to that level of salary reduction, and the league would argue that there's no traditional rollback contained in it.

But when it comes to reducing salary, the question we'd ask Parise: Did Minnesota Wild owner Craig Leipold — a talented man that can simultaneously cry poverty and never let a tear hit his $196 million in unrestricted free-agent contracts — negotiate in good faith, indicating that you'd receive the full value of his 13-year, $98 million deal?

Or, more to the point: Did Parise believe he'd be paid every dollar of that contract?

The speculative answer is "no," because why else does one frontload a contract with $25 million in untouchable bonus money if he believes his contract value won't be affected by the next CBA's terms?

The logical answer is still "no," because the current escrow system dictates that NHL players could lose part of their salary for the benefit of the owners. As Bill Daly told Michael Russo last month:

"Our system contemplates the fact that in certain years there may be a reduction on contract value [anyway]," Daly said. "In fact, under those seven years operated under this CBA, there have been contract reductions in five of those years [because of escrow]. It's not a feature of our system that every player is guaranteed every dollar he contracts for."

That last comment caused a crap-ton of controversy, lighting up Allan Walsh's Twitter feed like the Rockefeller Plaza tree. But it's the way of the world under the current CBA.

Which is why the players are going to fight like hell to make sure their dollars count in this next agreement.

Donald Fehr, in an interview with The Hockey News, made it clear that the NHLPA expects its players' contracts to be honored:

"When you're talking about reductions in player costs, you do get into some matters which are very difficult to bite into. Because if somebody signs a contract based on current expectations as to what that will pay, but someone then says, 'Well, okay, but it's going to be five percent or 10 percent or 15-20 percent less', does the player then get to say, 'Okay, I'm then out of my contract and I don't have to work that five or 10 or 20 percent'?

"The point is, in a very basic and elementary way, tells you what's going on with their bargaining position."

(Boy, that Fehr drives a hard bargain, doesn't he?)

It's such a simple concept: You make an employee an offer; they agree to those terms; you sign a binding contract; and then over the term of that deal, the employee is compensated at the agreed upon levels.

Does it always work like this? Of course not. Businesses across the landscape ask their employees to make sacrifices if conditions sour. In some cases, it means surrendering salary; in other cases, it could mean deferring it until conditions change.

Essentially, the NHL is in the latter category, perpetually: Escrow exists to ensure the profitability of a league that, going by its numbers, had roughly two thirds of its teams losing money last season.

(That said, players are expected to get nearly all of their money back this month in escrow checks, which is one reason we're not going to see a CBA resolution anytime soon.)

Larry Brooks of the NY Post has long seen capping escrow as a way to honor existing contracts, avoid a de facto rollback and as a path to a settlement:

It is true that escrow has been part of the system under which the NHL and the players have operated the last seven years, as deputy commissioner Bill Daly mentioned the other day.

But the fact is the players received at least 97.51 percent of their contracts' full value in five of those seven seasons, with the average escrow loss over their seven years amounting to 3.2 percent.

If the league were to offer to cap escrow on all existing contracts at 3.2 percent, the discussion immediately would be transformed into a serious negotiation on all other issues. An immediate offer to cap escrow at, say, 5 percent on all existing contracts would all but ensure a settlement within weeks that would allow the season to open as scheduled.

Brooks argues that the $1.65 billion in contracts for 2012-13 season were handed out by owners that knew they'd simply rewrite them in the next CBA. Which means that they were throwing counterfeit money at free agents and young stars, dazzling them with fat contracts but, essentially, negotiating in bad faith.

Back to Parise: Did Leipold and the Wild negotiate in bad faith?

Did Parise and Suter know their contracts may not have the actual value they were assigned on paper? Or did they ink deals defiantly, knowing that the CBA talks would offer them a chance to get their money as much as it offers Leipold a chance to take it back?

It all reeks of distrust. Which is why getting the players to sign off on concessions to the NHL has been so arduous: They just don't trust that these guys won't just break a deal and take more.

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