With the NHL lockout in its third week, THN spoke to NHLPA executive director Don Fehr for a wide-ranging interview on the negotiating process and the road ahead. Here is a transcript of that interview.
The Hockey News: I realize all your negotiations with Major League Baseball in previous years have been different animals, but what stands out for you about this current negotiation, both positively and negatively?
Don Fehr: The positive is really easy – it’s the players. They are involved, they are committed, they participate, they understand, and in the end, they’re making the decisions. That’s why we have conference calls with the full negotiating committee and the full board. That’s why we have meetings in which we invite about 50 people – the negotiating committee and the executive board – and more than 285 players show up. So that has been the single-best thing about this for me, because this is their organization, their contracts and their futures. That’s why you’re in it, because you want to help them.
The negative I guess, can basically be that this negotiation is seemingly just following the pattern of all the (salary) capped sports. The entire position seems to be that this is concessionary bargaining, and as a matter of natural law or the way the universe is ordered somehow, the players should be willing to take severe reductions in their compensation and not have a free market for their salaries and not be able to go look for a job as you, or I or anyone else in the Western World can, and it has to be that way. And the only point in the negotiation is how far/how fast are players going to make concessions.
Just in this century, you have basketball, hockey and football (owners) all come in and say, ‘We want what we want because we want what we want. And you have to give us what we want, because we want what we want.’ And that appears to be the basic approach. And it’s true whether they claim severe financial distress like hockey did the last time, or whether there’s no conceivable distress that anybody with two synapses can see, which is what you see to some degree with the NFL and basketball, and with hockey this time. I’ll tell you what I mean by that in a second, but that’s just the way they do it.
And it’s just like what happened with the NFL referees. They had no reason in the world for them to lock out the referees, for goodness sake – except that they can. And that’s what they do. That’s the negative part of it.
THN: Having heard some of the NHL’s comments in the 2004-05 lockout – that the owners wanted a partnership with the players, or Gary Bettman’s statement the league’s teams could lower ticket prices in a salary-capped world – it seems clear that skepticism was called for this time around. That said, even if you were expecting the owners to be aggressive again in bargaining, were you at all taken aback by the league’s opening CBA offer many have called a scorched-earth, draconian offer?
DF: Let me say a couple of things. First of all, I wasn’t here for any of the ticket price references. I have been told those suggestions were made and when I was first told that, I thought that was truly bizarre, because ticket prices have nothing to do with salaries in general, even in baseball. They’re based on a judgment of what the market will support like any other business, and the salaries follow afterward. And in the capped sports, they follow directly afterwards: revenues determine what the salaries are. So the notion that was going to be the case, I always thought was just silly from an economic standpoint and I’m perplexed that anybody took it seriously.
Secondly, the notion there was a partnership depends on what you mean. If you mean a partnership in the sense that we have a whole bunch of people working for the same enterprise, maybe that’s one thing. If you mean a partnership in the sense of shared control, shared decision-making, joint respect for each other’s views, maximum efforts to work together and all the rest of it, that’s never been the case, that isn’t the case now and there’s no hint of it in what we’re doing.
In terms of the level of disappointment, the answer is, yes, I was considerably disappointed. I don’t run to the public like they do and say how disappointed they are in the players’ offers, like the allowance isn’t big enough. But I was disappointed from a bargaining standpoint and what I mean by that is that you don’t see a way, given what the other side is doing, to come to a quick agreement.
I was disappointed for a few reasons, one of which is this: the magnitude of the salary concessions in their initial offer was just staggering. It dwarfs on a yearly basis, by several times to one, any claimed financial issues.
Secondly, they’ve come in with a position that essentially says, ‘We are interested just in lowering salaries because we’re interested in lowering salaries,’ And while they say they want every team to make a fair profit, you will notice they don’t tell you what that means. They don’t tell you what a fair profit is, they don’t say that, just to pick a team out for argument’s sake, that ‘in Phoenix, we have to create X dollars to make a fair profit,’ and they are insisting that the salaries on Toronto and Vancouver and Montreal and the Rangers and everybody else has to be reduced so those teams can make even more profit at the same time. So there is no distinction between where problems may exist and where it is conceded that no problems exist.
That was the second reason why I was disappointed. The third reason – and this, to me, was the indication this negotiation was going to be a real struggle beyond anything I had thought – was that when they put their initial proposal on the table, it would gut player contracting rights, which was the tradeoff players made in the 2004-05 negotiations in return for their cap. When they said, we have to change all this stuff, that was a gut-punch to every player in the league, because every player in the league knows, ‘This will affect me, or the guy next to me, or this affects my younger brother who is 19.’ So if you want to get people’s attention and try to make a deal, it’s pretty hard to do that if you start out with that kind of approach.
That, to me, was very disappointing because it suggests one of three things, none of which I like: the first one is that they don’t think players will understand this stuff, so let’s just do it; the second one is that they’re not really interested in trying to help the game or improve competitiveness, they’re just interested in maximizing individual team control over players; the third one is they just don’t care.
THN: With the scope of the clawbacks and the initial attempt to tie down player movement, if you had agreed to their demands, would we be looking at dragging the NHLPA back to the pre-Ted-Lindsay days?
DF: Not quite that far, but if I had agreed to it in theory, I suspect it would have been the last thing I would have done and been promptly repudiated, so we wouldn’t be worried about Don. Don would be back home trying to clean the house and spend some time in Arizona.
THN: One thing I don’t hear mentioned enough so far is the importance of franchise values for owners. Is that one of the ultimate goals for owners, to boost franchise values no matter what?
DF: I don’t know if it’s the ultimate goal, but the fact is, if you improve, especially in an enormous way, the cash positions of the teams by lowering costs in a pretty draconian fashion, that has a profound and immediate effect on franchise values. When we have asked them basic questions like, ‘What do you think franchise values will increase to under your proposal?’ they say things like, ‘I don’t know.’ Well, give me a break.
Or if we ask, ‘With your proposal, how does this affect the cash position of each individual team? They say, ‘Well, we don’t know.’ I understand why they say that – they say it because it won’t be helpful to their position. But it really doesn’t help the bargaining relationship for them to do that.
Let me give you an example of what I mean: Let’s say your team makes 10 dollars in revenue right now and you’re trying to sell it to me. You say, ‘I have 10 dollars in revenue and nine dollars in cost, so I’m selling you a team and you can price it based on the 10 dollar revenue figure or the one dollar profit figure’ and figure out what you’ll pay for that team. Then I come back to you and say ‘I still have 10 dollars in revenue, but now I have eight dollars or $7.50 in costs, so my profit number has gone up substantially, so to buy this team, you’ll pay me more, right?’ And of course, the answer is ‘absolutely.’ But the trick is if I want to sell, I can take out the full value of all the reductions of the next several years (of a CBA) right away.
The last thing I would say is that 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.
THN: One of the other common comments you hear now is that players are somehow hurting union solidarity by playing overseas. Is that a case of cognitive dissonance among some people who can’t see that players are businessmen in their own right who look at all their options, just as owners do?
DF: Yeah, you might say it’s that, or just spin. But look, when you’re an owner and you say there’s going to be a lockout, and you’re a player and you see owners said they’d lock out players last time – and they did and it lasted a year and you saw football and basketball do it and you saw the NFL do it with referees – then when the lockout starts, you tend to believe them.
THN: Part of the bigger picture here is the history of the NHLPA, which isn’t the greatest given the betrayals of Alan Eagleson and the tumult that followed Bob Goodenow’s departure. But ever since Eagleson left in 1992, the league has had four work stoppages – one strike and three lockouts – in 20 years, which averages out to one clash every five years in the Gary Bettman era. I don’t put the blame all on Gary Bettman, but is that why players see they’ve had to keep on giving back and might expect the owners will come back for more each and every CBA negotiation?
DF: Given the history of this sport and every other capped sport, I think that unless this negotiation results in something everybody says is a long-term agreement with which we can live – meaning it has to be mutually perceived as fair and equitable – you’re just setting the stage for another conflict down the road. I don’t think there’s any doubt about that.
And if you follow what’s happened in the capped sports, part of the problem from a player’s standpoint is that the basic view is, whatever the circumstances are, if the owners’ position is, ‘Let’s lock out and see if they’ll give us some more,’ it really doesn’t matter what your agreement is.
By the way, when you talk about problems (within the PA), I want to make a couple points. First of all, the strike, which I wasn’t here for, was very short and it was over a very discreet licensing issue. All the major problems have come as a result of lockouts and there has been more time lost to hockey lockouts than the other three sports combined in the past 20 years and I believe that includes the 1994-95 baseball strike. That’s the first thing.
The second thing is, after Alan left and Bob came in, there was a very long period of (PA) stability in which players had a lot of confidence in the organization. And there was, after the lockout, with the change in administration, there was a significant period of flux and instability. And one of my jobs here is to try and put an end to that, so that after this negotiation is over, we can continue the task of rebuilding the structure so that when I retire, or retire partially or go on and do something else, that you’ll have an organization here that is independent of any single person who is in it, specifically including the executive director. That’s one of the goals I have, because the guys here deserve better.
THN: As far as what lies ahead, how have you prepared players for the weeks and months to come?
DF: There’s a lot of communication going on here with players every day. There’s written communication every couple of days, and you keep players updated on an ongoing basis, you encourage them to participate, to call with questions, to air their views. We’re doing a pretty good job of that. With 750 players and their agents, you can’t talk to everybody every day, but we think we’re doing okay.
THN: In terms of the players who have stepped up, are you buoyed by diversity of players, young and old, who are making their voices heard?
DF: I’ll tell you something I learned a long time ago and I’ve re-learned it in spades since I got here: there are a handful of players in baseball and hockey – I don’t have the familiarity with football or basketball to include them – who get to the top level and stay there in a sport because their physical skills are so overwhelming that nothing else really matters. That is not true for the overwhelming majority – I’d say 95 percent plus – of players.
They get here because they have the skills and also the inner level of competitiveness, the intelligence, the situational awareness, the understanding that they’re in a game all the time that they have to figure out a way to win and that the game isn’t over until it’s over and there’s no clock in this one. They all get it.
And hockey players in this regard are no different than baseball players at all. And when you go to some of the younger hockey players, they get the fact that all of their future contracts are going to be negotiated within the framework of what we do now. It’s more important to them than the other ones. I’m gratified they’re there, it’s great, I have zero doubt they can handle it, but it’s exactly what I expected.