SBJ/May 7-13, 2012/Labor and Agents

Kelly thinks NHL owners will try to boost share of revenue

Liz Mullen
Former NHL Players’ Association Executive Director Paul Kelly said he doesn’t think players will try to get rid of the salary cap and expects NHL owners to seek a greater share of revenue in negotiations for a new collective-bargaining agreement this summer.

“I don’t think there is any chance you are going to abandon or get rid of the salary cap in hockey,” Kelly said in a telephone interview last week. “So I think the big issue becomes really what percentage of the total revenues flow to the players — and whatever that number is dictates how high the salary cap is.”

The NHL CBA expires on Sept. 15, and the two sides are expected to begin bargaining after the NHL postseason. So far, neither the union nor the league has publicly stated what changes, if any, it is seeking in a new labor deal.

Kelly, who was NHLPA executive director for about two years, noted that in the new NFL and NBA CBAs reached last year after the leagues locked the players out, the percentage of revenue going to the players went down. Kelly expects that to influence the NHL negotiations.

Former NHLPA chief Paul Kelly thinks the salary cap is here to stay in hockey.
Photo by: GETTY IMAGES
Kelly also noted that the same law firm that represented the NBA and NFL in collective bargaining and during the lockouts in those sports, Proskauer, also represents the NHL.

“Under the current agreement, [the players’ share] is 57 percent, but based upon the precedent that has been established in football and in basketball, where those numbers are down around 48 or 50 percent, there is no question that the management in the NHL will be looking to a similar level in the high 40s or somewhere around 50 percent,” Kelly said.

The NHLPA declined to comment on Kelly’s statements.

NHL Deputy Commissioner Bill Daly, asked whether the NFL and NBA lockouts had produced a new standard on how players should be paid, said via email, “I’m not prepared to comment on whether there is an established ‘industry standard.’ Those leagues and the players in those leagues did what they did in collective bargaining. At the appropriate time, our League and our Players will do what we need to do, and I’m sure that there will be many factors — both internal and external — that may play into that.”

Daly added that no formal bargaining sessions have been scheduled. “As we have repeatedly made clear, we are prepared to engage whenever the Players’ Association wants to — whether that’s before the Stanley Cup is awarded or after is really up to the Players and their representatives,” he said.

Both Daly and NHLPA Executive Director Don Fehr said in September that they expected to begin formal negotiations for a new CBA over the winter. Later in the year, Fehr said he expected to begin negotiating after the All-Star Game in late January.

Said Kelly, “They appear to be waiting a little bit late in the day to start the dialogue — which if they don’t start the discussion until when the playoffs have concluded … they are not leaving themselves … a lot of wiggle room in terms of the calendar.”

Kelly was NHLPA executive director from October 2007 until August 2009, when he was fired by the players. He resigned in February as executive director at College Hockey Inc., a group that aims to raise awareness about college hockey for the sport’s elite players. Kelly had been with that group since late 2009.

Last week, Kelly started a new job as a partner in the sports law practice in the Boston office of national law firm Jackson Lewis. Prior to working at the NHLPA, Kelly was a trial lawyer and a former assistant U.S. attorney.

“Jackson Lewis typically represents larger employers and in the sports industry would represent teams, leagues, prospective franchise owners, colleges, and individual arenas and facilities,” Kelly said. “Basically, they do the opposite of unions: representing management on the professional level.”

Gregg Clifton, a longtime MLB agent, left the former Gaylord Sports Management (which was acquired by Lagardère Unlimited earlier this year) in 2010 to become chairman of the then-fledgling sports practice of Jackson Lewis. “We are doing arbitration for two major league [team] clients [and] a lot of immigration for NHL as well as MLB clubs,” Clifton said. “We are thrilled to add someone with his experience in sports and law to our team.”
 
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Liz Mullen can be reached at lmullen@sportsbusinessjournal.com. Follow her on Twitter @SBJLizMullen.

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