Notes from 2004 NHL lockout show mediation makes sense

Share

Here are two words rarely used in the same sentence - "lockout" and "fascinating."

But fascinating is the only way to describe the correspondence between NHL commissioner Gary Bettman and players association executive director Bob Goodenow that occurred in the frantic 48 hours just before the 2004-05 season was officially cancelled.

In reviewing the exchanges between the two lead negotiators the last time the league and the NHLPA went toe-to-toe, a couple of things become clear—beginning with what the actual drop-dead date to salvage the season might be.

That was a much-discussed topic last time around and most people got it wrong, setting it far too early. Based on the 48-game schedule played after the 1994-95 lockout, the feeling was that mid-January had to be it, if you wanted to save a meaningful number of games.

But the actual cancellation didn't come until Feb. 16. For comparative purposes, consider that last season, 850 games (out of a 1,230-game regular season) had been played by Feb. 15 already. Even if you pushed the Stanley Cup final deeper into June, you wouldn't have much of a season. Still, you'd have to think that if the NHL was prepared to wait until mid-February the last time, they'll be prepared to do so again.

Then there is the matter of where - and when - compromise will eventually occur. Just as in 2004-05, both the NHL and the players association seem firmly entrenched in terms of what they want to see in a new CBA. A key phrase in the last lockout was the owners' desire for "cost certainty." The NHL wanted a fixed link between revenues and player costs which, according to their figures, had risen to 75 per cent of total revenues - too rich for their blood.

Their belief was that if players salaries could be set at a fixed rate, then what was left over would be enough to satisfy the bottom lines of all 30 NHL teams, with a little revenue-sharing thrown in.

Player costs were said to be "linked" to revenues and "linkage" was a non-negotiable pillar of the NHL platform.

And then, in the last days, it wasn't any more.

The league presented the NHLPA with an offer not linked to league-wide revenues, a drastic 11th-hour shift, presented by Bill Daly, the NHL's No. 2, to Ted Saskin, Goodenow's deputy.

Bettman, in a letter to Goodenow, put it this way: "De-linking a maximum team salary cap from league revenues and total league-wide player compensation has always been problematic for us, especially since we cannot now quantify the damage to the League from the lockout. This presents the risk that we will pay out more than we can afford."

Bettman's final offer came in at $44.7-million ($42.5-million in salary and $2.2-million in benefits) and then ended his letter with a dire warning: "This is not an invitation to begin negotiations - it's too late for that. This is our last effort to make a deal that's fair to the players and one that the clubs can (hopefully) afford."

Goodenow responded first by explaining his own about-face: "Our offer of a team cap represented a radical step for the PA. We took this step because we too believe the sport will be damaged greatly by the cancellation of this season and the continuation of the lockout next season."

Then Goodenow allowed some frustration to seep into his response: "We wish that the NHL had offered a 'no linkage' proposal before yesterday, so that negotiations in that arena could have commenced sooner."

From there, Goodenow made a counter-proposal - reducing the maximum cap to $49-million (excluding benefits), and tweaking a luxury-tax provision "so that a successful team does not have to arbitrarily dismantle its roster after it has achieved particular success or is in a unique phase of its player roster cycle."

And at that point, the back-and-forth took on a nastier edge.

Bettman replied: "We would have been prepared to propose and negotiate over a 'de-linked' maximum team salary sooner, but the NHLPA had been consistent in stating that the players would never accept a salary cap. We only learned in the mediation process Sunday that you would entertain such an offer."

Bettman concluded that if every team spent to the $49-million maximum, player costs would "exceed 75 per cent of revenues. We cannot afford your proposal."

Over to Goodenow:

"The notion that 'every club' will spend at the 49 million level is contradicted by years of actual payroll experience under the old CBA system," answered Goodenow. "Further, this experience is based on an environment without revenue sharing, taxes on team payrolls and the numerous new system restrictions."

And then, the short and sweet kicker from the NHLPA: "You will received nothing further from us."

And that was that.

The next day, Bettman cancelled the season. An attempt to broker a deal in the next few days, which included Wayne Gretzky and Mario Lemieux, failed, with neither side willing to budge any further.

So what can be distilled from this; and is any of it helpful, in the context of the current wrangle?

Mediation, for starters, might have some value. Bettman referenced that in his correspondence with Goodenow - that they only learned of the willingness of the NHLPA to accept a salary cap in mediation. If mediation made a difference in forcing both sides to finally show their negotiating hands, doesn't it make sense to pursue that step sooner rather than later?

Daly, incidentally, didn't rule out mediation when it came up after talks broke down earlier this week, but he didn't seem anxious to embrace it either.

You wonder though: Why wait to go down that path until the season's teetering on the brink if it helped bring the sides closer last time?

The other thing that Bettman's and Goodenow's back-and-forth illustrate is that positions which seemed previously unassailable - the NHL's need for linkage, the players rejection of a cap - weren't at the 11th hour. It was simply that neither side wanted to budge first.

Can Fehr, with his history of labour disharmony in baseball, actually close a deal? Can Bettman, with three lockouts and the only cancelled season in professional sports history, actually close a deal?

And more importantly, do they need to wait until the second week of February - more than four months from now, when two-thirds of the season has gone up in smoke - before they start offering up meaningful concessions?

Sometimes, the lessons of the past can be helpful in cobbling together a new future.

Sadly, more often, it goes the other way, and always leads me back to the words of philosopher George Santayana:

"Those who cannot remember the past are condemned to repeat it."