CBA Reading Comprehension Problem?
by Quisp on Jul 27, 2010 12:02 PM PDT
in Kovalchuk
19 comments
The Hockey News: Ken Campbell's blog: Kovalchuk contract could be restructured by arbitrator
When the NHL Players’ Association filed a grievance Monday to dispute the NHL’s rejection of Ilya Kovalchuk’s 17-year, $102 million contract with the New Jersey Devils, it ran the risk of having an arbitrator restructure the contract if he or she sides with the NHL in the matter.
But no. Because the league alleges an Article 50 circumvention, the arbiter has two choices: contract is good, contract is bad. There is no, CONTRACT IS THIS! HAHAHAHA!
One source close to the situation told THN.com that one of the possibilities would be for the system arbitrator to reform the contract instead of rejecting it and if it were reformed, it would likely be to make the cap hit and salary flat, which would mean Kovalchuk’s contract would pay him $6 million per season for each of the next 17 seasons.
Oh, source. Sourcey, source. You're cute. But. 11.6(a)(i), not 11.6(a)(ii) applies. No question.
The source said that when the league rejected the contract, it cited two different provisions in Article 26 of the collective bargaining agreement, which deals with circumvention. One of the provisions would call for the contract to be declared null and void if the arbitrator sided with the NHL, the other calls for the arbitrator to reform the contract.
As much as it would be hilarious for the source to know what he's talking about -- because the hint of an Article 26 procedure would cause the collective noggin of the Devils fan brain trust to explode -- there are no "two provisions" that fit that description in Article 26. They are 11.6(a)(i) and 11.6(a)(ii). (There ya go, ILWT; don't say I never did anything for you. )
It’s possible, the source said, that the two sides would have a proceeding prior to the arbitration hearing that would spell out which of the two alternatives will be used if the arbitrator sides with the NHL. But since the case will undoubtedly be expedited, it’s possible the two sides could go into the proceedings not knowing what the ramifications are of the outcome.
A proceeding prior to arbitration? That does sound like Article 26. I suppose it's possible that the league and the NHLPA have conflated the two Articles. That would comport with other things the league has said (or sources have said the league has said, or nobody said and somebody just made it up), e.g. the talk of fines (which come from Article 26) and the talk of a chance to work things out (first Daly press release), rather than sticking to the strict procedures of 11.6.
In any case, if you give this source any legitimacy at all, the whole idea that (note: I don't believe any of these things, but other people do): (1) there can't be fines because we're dealing with Article 11; (2) there can't be penalties because there's been no interminable investigation; (3) Article 26 "doesn't figure in yet" so the contract is "safe" -- doesn't seem to be the way the league and the union are interpreting the CBA. Like I said (and have said a million times), the exact relationship between 26 and 11 is not explicitly defined in terms of procedure, so don't be surprised if it turns out to work in a way you don't expect.
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How pissed would Kovalchuk be if the contract did happen to be re-structured to pay $6 million per year for 17 years? Then he really better play all 17 years to get his money and who thinks that is likely. Kovy would likely try to get the contract overturned somehow because he never agreed to it if that is the case.
yes, and this is why the "source" interpretation is confused and incorrect
it’s simply not possible, and there’s no way a player would play under such a contract.
Wait till this year.
If we were in fantasyland...
…I would rather the arbitrator change it to a $95/10 deal and watch NJ implode.
I think "no question" is a bit strong, but,
Why are you sure that (i) applies rather than (ii)?
And following from that, what do you figure the NHL would have done if the contract was from (say) the Islanders, who are way, way under the cap? Still claim that the Isles are trying to circumvent the upper limit, or reject the contract under (ii), or accept it?
Here's my reasoning.
1) The league rejected the contract, saying that it is a circumvention of the salary cap, that is to say: the upper limit.
2) 11.6(a)(i) says, “(i) If an SPC or an Offer Sheet is rejected: (A) because it results in the signing Club exceeding the Upper Limit, or (B) because it does not comply with the Maximum Player Salary or © because it is or it involves a Circumvention of either the Club’s Upper Limit or the Maximum Player Salary,” etc…
3) (ii) applies to any case that doesn’t fall under (i).
As far as the “what if it were the Isles” or anyone else for that matter, I think the result would have been the same. I know that some folks think, for example, the league is singling out New Jersey, but I think the real motivator is that the contract term is so long that it embarrassed Bettman. Hossa was bad enough for the league, but it’s like Hossa was flirting with the line and it pissed Bettman off and everyone knew it and now this one is way over the line, so it’s even more embarrassing. Yeah, we can debate the difference between 42, 43, 44, etc.. but the Kovalchuk contract is an escalation and magnification of the problems in the other front-loaded-mega-term deals, and even if you disagree about the degree of magnification, I think you’ll at least agree with me that (no matter how small the difference) it was enough to push Bettman over the edge.
I hope that answers your question.
(p.s. the Islanders are in kind of the opposite situation, where a contract like that wouldn’t help them. They would be helped more by trading for Brian Campbell. They’re one of the few teams who need to absorb EXTRA cap hit and they could get some good picks frpm Chicago since the cap space the Isles would be trading back is hugely valuable.)
Wait till this year.
The way I see what’s happened so far and what should have happened:
- Under Article 26.10(a), the NHL initiated a sua sponte investigation of the Kovalchuk SPA.
- Per 26.10(e), a non-binding finding that a circumvention had occurred was announced.
- A meeting between the NHL and the NHLPA should have occurred within three days to attempt to resolve the difference, per 26.12.
- If they were unable to come to a resolution, it should have been referred to the (currently non-existent) System Arbitrator with 48 hours, with a hearing within 7 days of the referral and decision within 3 days of the hearing, per 26.13.
- To the best of my knowledge, neither 26.12 nor 26.13 were followed. However, since both parties may jointly agree to extend the deadlines within 26.13, it is possible that the System Arbitrator will be hearing a case on whether a circumvention has occurred.
- If the Arbitrator found a circumvention had occurred, the penalties under 26.13© would be applicable, and we would move to Section 11.6(a)(i) for a hearing on voiding the SPC. If not, the NHL would not have a case for voiding the SPC.
Instead, the NHL appears to have jumped from 26.10(e) to 11.6(a)(i), skipping the need for arbitration to determine if circumvention did happen. Now, it’s entirely possible I’m wrong, but from reading over those two sections of the CBA, that’s how it looks like they’re supposed to interact – 26.10 is on the finding of circumvention, 11.6(a)(i)© is what you do after determining a circumvention has occurred.
Honor is no substitute for victory.
I don't think that's correct.
11.6 is the procedure for dealing with rejected contracts. It is an expedited process, to allow for the specific incidence of article 50 contrasct violations. it concludes with the arbitrator, who makes a binding decision.
26 describes a general procedure for investigating possible circumventions of any kind. for instance, undeclared mascot revenues. in the event of an 11.6 series of events, 26 describes the process for levying penalties. that process and its relation to 11.6 is ambiguous, but the ambiguity is related to how quickly (or not) after an 11.6 ruling the commissioner may assess penalties.
Wait till this year.
The one thing you have missed in this whole mess
.. is that there is nothing in the world that REQUIRES the NHLPA and NHL to follow the terms of the CBA should they mutually choose not to.
The CBA is there to say here is what happens when we disagree on something. But, like any contract, the parties involved can freely choose to ignore it (perhaps at their peril).
If the NHL chooses to allow the Devils and Kovy to try again, the only entity in the world who can put a stop to that is the NHLPA. If the NHLPA agrees to look the other way, there is nothing you or I or the legal language of the CBA can do.
Now, what are the ramifications?
- Other owners can get mad that the NHL isn’t following the rules. In an extreme situation, they could sue to force the NHL to follow its own contract. Other players can get mad the NHLPA isn’t following the rules. In an extreme situation, they could sue to force the NHLPA to follow its own contract.
-
— In a future, similar stalemate, the NHLPA could be forced to live with a similar outcome. It is possible that an arbitrator or judge could say “well you let this happen last time.”
It doesn’t matter if you are reading the CBA right. I think what has happened is all parties involved have decided they simply want it to go away, but the NHLPA also decided it had better preserve its right to arbitrate by at least grieving. That said, if the NHLPA chose NOT to arbitrate, they are more likely to face a lawsuit by Kovy claiming they are not representing him properly under whatever labor relations acts the CBA falls under then they are to face a lawsuit by a thousand angry Shawn Horcoffs who will say grieving for Kovy takes money out of their pockets and is not in their best interest.
Just because the NHL and NHLPA have agreed to certain actions doesn’t mean they have to follow them in this case. It’s a contract. It is enforceable, but only if you choose to enforce it. If they don’t, no one else has any standing to force them to stick to their deal.
Not to mention...
That should the NHL and NHLPA mutually agree to give the arbitrator the right to restructure the deal, he can do so. However, I think this is unlikely. If this really goes to arbitration I think the NHLPA likes their case and would rather win outright than give an arbitrator any room to deal.
it REALLY is going toh arbitration
and they can’t give the arbitrator rights to do anything that’s not in the CBA. Can you imagine? The guy is a labor lawyer. He’s not going to rule that the parties told him it was okay to ignore the labor contract.
Wait till this year.
however, i see you registered with sbn this morning. welcome! new members to the nation are always embraced.
Wait till this year.
hehe
Don’t worry you didn’t scare me off. Appreciate the welcome. I am merely saying that… yes… the contract is a contract is a contract. BUT the only parties who can enforce the contract are the NHL and NHLPA. We can sit here and debate what they are and are not allowed to do, but they are perfectly free to mutually agree to ignore the contract and do something else.
There is no reason they could not have appointed an arbitrator and given that arbitrator broad powers as long as they mutually agreed to do so.
As I said at the end, this was all very unlikely. I think the NHLPA was more than happy to let Kovy and the Devils try to restructure a deal and then they’d drop the whole thing. Why? I don’t think the union is united on this. A whole legion of “middle class” players are getting the shaft in escrow and they know Kovy’s contract means: “bye bye escrow”.
BUT, since clearly no restructuring occurred (and honestly, we don’t know what went on behind the scenes), I really think the NHLPA likes their case and was more apt to say “let’s let the CBA play itself out.” It’s a win for them, because if they win the case, they can always say to membership: “We simply enforced your CBA. We know you want changes and we will be there for our membership at the next negotiation.”
Remember, my point was that parties to a contract CAN agree to ignore that contract as long as they mutually agree to do so.
I suppose that's so
But word is that an arbitrator has been chosen, and the process as outlined in the CBA will be followed from here on out.
So that appears to be a moot argument at this point. But even taken on its own terms, it would be a heck of a thing for both sides to say that the CBA, which both sides negotiated at such pains to both sides, is essentially worthless because they mutually agreed not to follow it. That starts pulling on a loose thread, and at what point do you stop, short of unravelling the whole fabric?
There are times...
when parties to a contract decide it is better to restructure a contract than to ignore it. This was obviously not one of those times. As I said before I think the NHLPA would not have minded watching the mess clean itself up, but grieving for Kovy isn’t a horrible outcome for them, even if it steels the owners resolve in the next lost season… I mean… negotiation.
what requires it is that the NHLPA answers to the players and the league answers to the owners
and they all have a stake in maintaining the integrity of the CBA.
on top of which, what you say is always true. the police don’t have to arrest people, the state doesn’t have to prosecute crimes, etc., and in all cases there are remedies. as you point out.
I don’t see any evidence that “all parties involved have decided they simply want it to go away.” Devils fans want it to go away. Bettman, not so much.
Anyway, the arbitrator will rule this week. it’s binding. and as the arbitrator is a labor lawyer with a reputation to protect, i doubt he will view the contract as lightly as you seem to.
Wait till this year.
I never said...
that the arbitrator would look at the CBA lightly. I said the NHLPA must like their case. Heck, I like their case.
What I said was: “That should the NHL and NHLPA mutually agree to give the arbitrator the right to restructure the deal, he can do so. However, I think this is unlikely. If this really goes to arbitration I think the NHLPA likes their case and would rather win outright than give an arbitrator any room to deal.”
You have complained throughout this process that Bettman et al were taking it all lightly and insinuating renegotiations could take place and that was all in violation of the CBA. What if the NHLPA was okay with a quick renegotiation. That WAS an option.
The reason the NHL might be willing to arbitrate here is to lose a battle but win the war. Losing this means they can really go hard in the negotiation with a lot of ticked off resolute owners will to do anything to win the next battle.
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