First escrow adjusment

[Mel]

All NHL players will have 12% deducted from their first paycheck of the season to fund the escrow account, which plays a key role in dividing revenue between players and owners.

At the start of each season, a projected league revenue figure is calculated. Throughout the season on regular intervals, a gang of bean counters determine if the league is on pace to meet, exceed, or fall short of projected revenue. These reports determine the escrow deductions for the following paychecks until the next report.

The players will lose this money if revenue projections are not met. On the other hand, if revenue goals are exceeded... the players will get more money back than they put in as a reward (I think I have this right).

It's a sliding scale. the players cannot earn more than 54% of the projected revenue of the league, Unless revenue exceeds the projection. In which case they get more of the pie. (higher than 54%)

:shrug:

:coffee:

here's one article -> http://www.boston.com/sports/hockey/articles/2005/10/09/first_nhl_checks_to_be_docked_12_percent/

[a4l]

Sounds like they may be getting some of the money back at the end of the season.

[slapshot™]

Interesting plan to spread the wealth. Am I correct to assume that the revenue and the 54% the players are to distribute amongst themselves does not include pre-season or playoff revenue?

[Mel]

Interesting plan to spread the wealth. Am I correct to assume that the revenue and the 54% the players are to distribute amongst themselves does not include pre-season or playoff revenue?

Well they have a concrete number right now, of what each team can spend on payroll which would wind up costing no more than 54% of projected revenue. It's somewhere between the floor and the cap. Out of the gate here, most teams are over this figure... and it is the player's collective responsibility to cough up enough to the escrow, to make sure the owners can be reimbursed if they are still over at the end of the season.

I honestly don't know how or where playoff revenue fits into this picture. But 2 things can happen as the season progresses. 1) Team spending drops or more likely 2) revenue projections increase, raising the magic number that teams can spend on payroll.

So they players can very well get this money back, but it basically depends on the state and success of the NHL overall. It's not arbitrary, but based on real dollars available to go around. IIRC, the NBA has used a similar escrow system for years.

The players have been fully aware of the escrow system since ratifying the CBA... but it has to sting anyway. Coughing up 12% right off the bat here, on top of the 24% rollback. Even though this was planned, I have to think it's bad for Saskin's popularity right now.

[KB in Kelowna]

Has anyone actually seen the CBA? I have questions regarding the enforcement of the cap and side deals that compensate a player under the table and so on. In the long term this deal may be good for some of the players in terms of base salaries and the earlier free agency, however the cynic in me still thinks some owners will still muck it up and will be crying poverty in the next few seaons.

[Mel]

Has anyone actually seen the CBA? I have questions regarding the enforcement of the cap and side deals that compensate a player under the table and so on. In the long term this deal may be good for some of the players in terms of base salaries and the earlier free agency, however the cynic in me still thinks some owners will still muck it up and will be crying poverty in the next few seaons.

I haven't seen it ver batim, but I am fairly certain from all I've read that it is near impossible to skirt the cap with back room shenanigans. This thing as far as I've been able to tell, is perhaps the most idiot proof and abuse proof cap system ever put forth.

Here's a snippet from a Q&A I read with Glen Sather over at http://www.newyorkrangers.com/fanzone/qa.asp
All player costs and compensation count towards the cap. There are only certain players that are eligible for performance bonuses, including entry level players, players over 35 on a one year contract and players that have missed a certain amount of games due to injury.

With all the belly-aching that goes on (I know some of it is legit)... what's gotten lost in the shuffle IMO is that the league minimum was bounced up to 400K and will be 500K by the end of the term. That's an incredible stride and one that benefits every NHL player, not just the big shots.

It seems like yesterday that Troy Mallette was making 40K on the Rangers. Think about that for a second. In the early 1990's, some professional athletes, playing in the world's best league, were paid less than garbagemen. Yeah Mallette was a goon pretty much, but he filled a valuable role on the team.

Now, by rule, any player who makes it to the NHL must be paid handsomely for it. Coupled with the major strides they (players) made in controlling their own mobility in their prime years, all in all they're in pretty good shape.

The escrow is something they need to live with, especially here in the early going. In principle, it puts the players and owners together as a team to make the NHL a success. And I think that's a good thing. When the league recovers, the players probably won't have to pay much in escrow, and in fact stand to get more back than they contributed. That means each and every one of them should be out there selling the game to the best of their ability. I think it stings in the beginning, but in the long run this will be a win-win situation.

[slapshot™]

Has anyone actually seen the CBA?

Here at NHPA.com -> THE NEW COLLECTIVE BARGAINING AGREEMENT WILL BE MADE AVAILABLE HERE IN THE NEAR FUTURE. THANK YOU FOR YOUR UNDERSTANDING. (http://www.nhlpa.com/CBA/index.asp)

[J.R.]

Here at NHPA.com -> THE NEW COLLECTIVE BARGAINING AGREEMENT WILL BE MADE AVAILABLE HERE IN THE NEAR FUTURE. THANK YOU FOR YOUR UNDERSTANDING. (http://www.nhlpa.com/CBA/index.asp) That is going to be one massive .PDF file.

:eek:

[Daryl Shilling]

I like the idea of an escrow system, and suggested one in the CBA article that I put on my site last October. Sure, right now the escrow "hurts" the players, but in the future, should revenues increase, they are protected by escrow as well, which will give them raises.

As long as the teams' books are honest, and I'm hoping that the revenue sharing plan helps in this regard, I view the escrow system as a means of protecting people on both sides of a player's contract. If the players do a great job, and sell the hell out of the game, it can only benefit them.

Daryl