With the NHL and NHL Players Association (NHLPA) working towards a new season, the topic of salary deferment is suddenly a major topic of conversation. It was an issue discussed in a lengthy call between the NHLPA Executive Board on Wednesday as it appears the NHL is pushing to amend the terms agreed upon in the new CBA reached over the summer. According to Elliotte Friedman, the NHL is seeking an additional deferment to the players' salaries and to raise the escrow cap.
There was no vote taken, according to Pierre LeBrun. Rather, the purpose of Wednesday's call was to discuss the league's proposals.
In case you need a crash course on escrow, the players and owners split hockey related revenue 50/50. To ensure the players' salaries do not bring them over their 50-percent, a certain portion of their salaries is taken out of their paychecks and kept by the league. This is escrow. At the end of the season, that money is used to adjust the overall distribution between the players and owners to an even 50/50.
The issue the NHL faces is that the league is losing money because of the coronavirus, enough that the players will end up with more than 50-percent unless the league takes a massive cut out of their salaries in escrow. Because no one wants to lose 50-percent of their paycheck, the NHL and NHLPA negotiated in the recent CBA to cap the escrow percentage at 20-percent next season and then drop that percentage each year after that. In addition, the players also agreed to defer 10-percent of what was left, meaning each player will only receive 72-percent of their paycheck this season.
Now with the 2020-21 season already delayed with no chance we will see an 82-game season and fan attendance very much a question mark, the league is looking for further ways to save money now.
But considering all of this was negotiated just a few months ago, you can see how this can be a contentious issue for the players.
Further complicating things is the fact that we are less than two months from the league's Jan. 1 target date for the start of the season and we still do not have even the basics of a season format. The start of training camp, the number of games, where the games will be played, the divisional alignments, the playoff format are all issues still yet to be decided. While both the league and players want the season to continue as quickly as possible and have a vested interest in making that happen, you can't have a season until it is decided just how much the players are going to get paid.
Add this to the list of challenges facing the NHL as it tries to prepare for the 2021 season.