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Volume 20 No. 42

Labor and Agents

Liz Mullen
Although the exact amount of player salaries held in escrow for the NHL’s lockout-shortened 2012-13 season won’t be determined until October, Deputy Commissioner Bill Daly said he expects players will get money back from the escrow fund, just as they have since the system was implemented eight years ago.
The escrow rate for the season, which began Jan. 19 because of the lockout, started at 10 percent, but the NHL and the NHL Players’ Association agreed to raise the rate to 20 percent in early March, drawing from a provision in the collective-bargaining agreement that allows the sides to adjust the rate based on revenue and revenue projections during the season.

“We expect that effective rate will be somewhere between 10 and 15 percent,” Daly wrote in an email, referring to the amount held back this past season.

The escrow system was put in place in the previous CBA, which ended the 2004-05 lockout, as a mechanism to keep the amount distributed to NHL players at an agreed-upon percentage of hockey-related revenue. That percentage was 57 percent under the old CBA and is now 50 percent under the new CBA.
The salary cap for last season was $70 million and has been set at $64.3 million for the 2013-14 season. Daly noted that players “have received money back every year since there has been an Escrow. Eight years now.”

The NHL and the NHLPA will determine both what the escrow was for last season and what it should be for next season in October, Daly said. The two sides set the escrow four times during the NHL season, depending on revenue projections.

There has been some concern in the hockey community that the escrow rate could be very high next season because of the lower salary cap and because clubs used “compensation buyouts,” a feature in the new CBA, to buy out the contracts of some players, making those players free agents. NHL clubs exercised the buyouts on 18 players and the money comes out of the players’ share of revenue, leading one agent to say he was worried the escrow could be as high as 25 percent because of the buyouts.
Daly dismissed that, stating, “I don’t expect an escrow rate at 25% — or even approaching 25% for next year.”
The buyouts are paid over twice the length of an existing contract. So, for example, when a club buys out seven years remaining on a player’s contract, that player is paid the money over 14 years.

“Compliance buyout payments are charged against the (players’) Share in the years in which they are paid,” Daly wrote. “Thus the impact will be spread out over many years.”

Bobby Wagner is making his second agent change in a month.
NHLPA Executive Director Don Fehr said earlier this month that it was too early to predict the escrow amount for this past season or next season.

> NFL AGENT MOVES: Seattle Seahawks linebacker Bobby Wagner left veteran NFL agent Fletcher Smith of Blueprint Management Group only a month after signing with him. Smith did not return phone calls or a text message as to why Wagner had left. Tony Osunsanmi, Wagner’s manager, said Wagner’s departure had to do with “a comfort level.” Osunsanmi added that Wagner would be signing with a new NFL player agent soon. Under NFL Players Association rules, players must wait five days after leaving their agent to sign with a new agent. Before joining Blueprint Management Group, Wagner was represented by Priority Sports & Entertainment. He interviewed several agents before selecting Smith.

Octagon has signed Carolina Panthers cornerback D.J. Moore. Octagon agents Doug Hendrickson and C.J. LaBoy will represent him. He was formerly represented by Dimensional Sports Inc.

Liz Mullen can be reached at Follow her on Twitter @SBJLizMullen.

Tony Clark, who was named the MLB Players Association’s deputy executive director last week, said his new title does not necessarily mean that he is the successor to MLBPA Executive Director Michael Weiner.

Clark was elected to the newly created position by a 26-0 vote of the executive board on a conference call last week. Players voted for Clark after Weiner recommended him for the position, Clark said.

Weiner, who is battling brain cancer, announced at the All-Star Game earlier this month that his symptoms had worsened and that players would elect a deputy executive director.

Clark played 15 MLB seasons and was active as a player representative throughout his career. He joined the players association in 2010 and was most recently director of player services. He was based out of his home in Arizona, but he moved with his family to New York a few months ago at Weiner’s recommendation.

Clark spoke to SportsBusiness Journal last week about his new role and what it means.

Clark will help define a new post at MLBPA.
How do you feel about your new role?

CLARK: The circumstance surrounding why this consideration even needed to be made is a tough one. … The one thing I take going forward is the idea that Michael had made a recommendation to our player leadership as to me being moved into this newly created position. And his support and his confidence in me is something that allows me to put my head on the pillow at night.

How were you elected to the position?

CLARK: Michael made the recommendation [last week] via conference call with our executive board. The process itself has been discussed for some time, going back to even last year. But there wasn’t an acknowledgment by Michael, or senior staff, officially until yesterday as to the direction that Michael wanted to go in or was going to recommend that we go in hiring someone.

What does your new job mean?

CLARK: I am to be an extension of Michael. So, without going into detail, it is exactly everything that Michael does. … What my day-to-day is going to be is going to continue to shape itself, but rest assured that within the short term I will garner a greater appreciation for the day-to-day activities of Michael and the executive director’s seat.

What powers does the deputy executive director have?

CLARK: I have the opportunity to be more engaged in what is going on day to day. With this role, the players recognize in the event of something happening that doesn’t allow Michael to be in the position that he is in at any particular time or any particular day, that the initial responsibility may fall to me in supporting the players and in the functioning … of the association. ‘Deputy’ doesn’t suggest ‘acting.’ ‘Deputy’ doesn’t suggest permanent. ‘Deputy’ simply suggests supporting to Michael’s active [role].

If and when a successor to Michael Weiner is named, when would that happen?

CLARK: That decision will be left to the executive board. The players literally run our organization. They make those decisions. … A successor will be determined by the players at the point in time when it is necessary to make that decision. … We are in a very new area. The title and the position has never existed before. Because of the circumstances, Michael believes it was a necessity at this juncture. I will add this. To me, Michael has an “S” on his chest. He always has. So if there is anybody that I don’t believe any of the rules apply to, it’s Michael.