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HOCKEY

NHL OWNERS TO DISCUSS FINANCIALS AMID SUSPENSION OF GAMES

TIM TUCKER
MARCH 21, 2020  ·  20H05
The longer the current suspension of games in the NHL lasts the more money team owners lose. The suspension, even if it were to be over within two to three weeks, will have a ripple effect on many issues. A good chunk of those will be financial in nature.

Because of that, club owners will participate in a conference call Monday to go over some major financial issues. According to TSN's Darren Dreger, that will likely include escrow and the current CBA, which is set to end after the 2021-22 season. Dreger reports club owners are "deep in the process of contingency financial planning."

That contingency planning, in its simplest terms, will attempt to mitigate any serious damage from the loss of revenue. Of course, that's a difficult thing to plan for at this time as no one has any idea when NHL hockey might be back. But, the club owners will have to start formulating something as over a week of games are already down the drain and initial estimates of two-to-three weeks are looking very optimistic at the moment.

Esgrow is something a few players have spoken out against. With the current CBA, a certain percentage of a player's salary is held in escrow in order to ensure an even profit split between owners and players once a season ends. In a CBC Sports article written in September of 2019, it was described this way:
"Players and owners split the NHL's "hockey-related revenue" 50/50 (players get their share in salaries). At the end of the playoffs every year, both sides get together and count up how much money the NHL made that season. They then use that number to estimate how much it'll make the next season (a five per cent bump is a typical ballpark guess). The salary cap, which is designed to make sure the players get 50 per cent of the revenue and no more, is then set based on that number.

But because it's impossible to predict exactly how much revenue will come in, a percentage of every player's paycheque is held in escrow until the money is counted at the end of the season (it isn't always the same, but 15 per cent is a good ballpark number). If the NHL does really well and exceeds the revenue projection by a significant amount, all that money is returned to the players. But if it doesn't, the owners get to keep however much they need to ensure they end up with exactly 50 per cent of the revenue.
It's an important issue for both sides and will be hugely impacted by the current suspension of play. How much so will depend on how long it lasts. Certainly Monday's conference call will be very preliminary, but it will mark the start of talks that could have an impact on the league well past this season, even if 2020-21 starts on time.

QUIZ ON TRADERUMOURS
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What is the name of this singer?
DIANE DUFRESNE
DIANE TELL
MARJO
NANETTE WORKMAN
SURVEY
Which scenario would you prefer if the NHL season restart?
END OF REGULAR SEASON + PLAYOFFS
IMMEDIATELY PLAYOFFS WITH 16 TEAMS
IMMEDIATELY PLAYOFFS WITH MORE TEAMS
IT'S BETTER TO CANCEL THE SEASON