Players agree to cap, but talks break down
Now, it's the cap size that snags an agreement.
Published February 15, 2005
NEW YORK - The NHL players' association agreed to accept a salary cap, but contract talks broke down early today over the amount that teams would pay.
Even while the negotiations were going on, NHL commissioner Gary Bettman had already planned to announce the cancellation of the season Wednesday, a source close to the negotiations told The Associated Press on condition of anonymity Monday.
Bettman was slated to speak Wednesday in New York, but the NHL declined to give details beyond the time and location.
The NHL offered to remove its demand for a link between league revenues and player costs, a "significant move in the players' direction" the union said in a statement early Tuesday following a meeting in Niagara Falls, N.Y.
But when the players offered to accept a cap at $52-million - the first time they came off their opposition to a ceiling on salaries - the offer was rejected by the NHL. The league insisted on a salary cap that topped out at $40-million per team.
"It is indeed unfortunate that with the major steps taken by both sides we were unable to build enough momentum to reach an agreement," players' association senior director Ted Saskin said in a statement early Tuesday.
No new talks were immediately scheduled, but with the philosophical differences now bridged there appeared to be room for the sides to negotiate dollar figures.
The 24-percent rollback on all existing contracts, originally offered by the union on Dec. 9, as well as more aggressive luxury tax rates and thresholds, were included in the players' counteroffer.
With the major stumbling blocks now out of the way, the sides are only $12-million apart on what each team's cap should be. With the salary rollback, only eight of the 30 teams would be above $40-million.
Until now, Bettman insisted that the 30 teams know what their costs will be each season. The only way, he said, that could be achieved was to tie to the amount of player costs to a percentage of league revenues.
That was a solution the players' association refused.
NHL chief legal officer Bill Daly was the only other person involved in the meeting that wrapped up early Tuesday. The NHL reported that no progress was made, but didn't reveal any details of what was discussed.
If a deal is not reached quickly, the NHL would become the first major professional league in North America to lose an entire season because of a labor dispute. The Stanley Cup has been awarded every year since 1919, when a flu epidemic canceled the finals.
But more than two-thirds of the season and the All-Star game already have been lost to a lockout that started Sept. 16.
Bettman said the sides needed to start putting a deal on paper by last weekend if the NHL was going to hold a 28-game season and a full 16-team playoff. The regular season normally is 82 games.
Even a session with a federal mediator Sunday in Washington couldn't produce an agreement. But it did lead to the breakthrough in talks Monday.
Bettman had said teams needed to have cost certainty to survive and the only way he could guarantee that was with a salary cap that linked league revenues to player costs. Now that position has changed for the first time since the NHL started gearing up for the lockout in 1998.
The league has said teams lost $273-million in 2002-03 and $224-million last season, and an economic study commissioned by the NHL found that players get 75 percent of league revenues. The union has challenged those figures.
A cap had been an automatic deal-breaker for the union even though it agreed that the financial landscape was flawed. The players' association contended that there are many other ways to fix it.
"There is no question the system has to change," said New Jersey Devils president Lou Lamoriello, who took part in earlier negotiating sessions. "We just have to keep working to find a solution. It's unfortunate we have to come this.
"If the season does end, we can't stop. We have to continue working at this and get it rectified as soon as we possibly can."
Monday, the 152nd day of the lockout, was to have been the last day of the All-Star break; the festivities in Atlanta were called off months earlier. Through Monday, 824 of the 1,230 regular-season games have been lost.
"Everybody has to take responsibility," Lamoriello said.
The sides have traded proposals throughout the lockout, but the salary cap had always been the sticking point. Other issues such as arbitration, revenue-sharing, and rookie caps never reached the true negotiating stage because the sides couldn't agree on the big issue.
In recent days, the union and league seemed adamant that they wouldn't budge.
"We're done," Saskin said Thursday after talks broke off.
On Sunday, Daly said: "We will not be reaching out to them."