NHL lockout: Donald Fehr sends memo to players regarding 'make whole' offer

By Adam Gretz | Hockey writer
Donald Fehr offered an update to the players on the 'make whole' portion of the NHL's last offer. (Getty Images)

Some optimism managed to work its way back into the CBA madness on Friday night and Saturday morning, when it was learned NHL deputy commissioner Bill Daly and NHLPA special counsel Steve Fehr will have face-to-face meetings this weekend at a secret location.

All of this came out just hours after the NHL axed the 2013 Winter Classic due to the ongoing labor dispute for what might have been the league's worst PR hit yet.

The meetings, wherever they take place, will be the first face-to-face talks between the two sides since Oct. 18, when the NHL rejected three separate NHLPA proposals. Adding to the optimism was a report from TSN's Darren Dreger on Friday night regarding a possible concession by the league in regard to the "make whole" portion of its last offer to the players.

NHLPA leader Donald Fehr attempted to clear up some things about that "offer" in a memo to the players on Friday night. Basically: No official "offer" was made, and it was simply informal conversations.

Here is the full memo, via CBC's Elliotte Friedman:

"You may have seen media reports this evening of a supposed league "offer" regarding the "make-whole" aspect of the negotiations. There have been no proposals from either side since the last talks took place on October 18th. As was discussed in detail by Steve Fehr on the Executive Board/Negotiating call yesterday, in informal conversations with the NHL this week, we have continued to explore how we can get back to the table and discussed with the NHL the issues we need to resolve, including the "make-whole" provision. We will continue to keep you updated and will let you know if anything concrete comes from these discussions. Meanwhile you should not read too much into media reports about informal phone calls.

"Following further phone conversations today, Bill Daly and Steve will meet tomorrow in a city and location that both sides have agreed to keep confidential in an attempt to keep the focus on the talks and not on conducting media scrums. We will update everyone following this meeting tomorrow."

The NHL's offer called for a 50-50 split of hockey-related revenue and also included the now infamous "make whole" offer that would have paid the players back over time for whatever salary reduction they saw over the first two years as a result of the new CBA. According to the initial offer, that money would have come out of the players' cut of the hockey-related revenue split. In the words of Fehr at the time, it was simply "players paying players" instead of "owners paying players."

If you want a refresher on the league's offer, this is the way NHL worded it on Oct. 17:

The League proposes to make Players "whole" for the absolute reduction in Players' Share dollars (when compared to 2011/12) that is attributable to the economic terms of the new CBA (the "Share Reduction"). Using an assumed year-over-year growth rate of 5% for League-wide revenues, the new CBA could result in shortfalls from the current level of Players' Share dollars ($1.883 Billion in 2011/12) of up to $149 million in Year 1 and up to $62 million in Year 2, for which Players will be "made whole." (By Year 3 of the new CBA, Players' Share dollars should exceed the current level ($1.883 Billion for 2011/12) and no "make whole" will be required.) Any such "shortfalls" in Years 1 and 2 of the new CBA will be computed as a percentage reduction off of the Player's stated contractual compensation, and will be repaid to the Player as a Deferred Compensation benefit spread over the remaining future years of the Player's SPC (or if he has no remaining years, in the year following the expiration of his SPC). Player reimbursement for the Share Reduction will be accrued and paid for by the League, and will be chargeable against Players' Share amounts in future years as Preliminary Benefits. The objective would be to honor all existing SPCs by restoring their "value" on the basis of the now existing level of Players' Share dollars.

Finding a solution on this is a major obstacle in finally reaching a new deal as the players want the money they were promised on their current contracts.

For the sake of seeing the NHL anytime soon, they're hopefully able to make some progress on this during their secret meetings this weekend.

For more hockey news, rumors and analysis, follow @EyeOnHockey and @agretz on Twitter and like us on Facebook.

 
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