Avalanche

BSN Exclusive: NHL players lost 14-percent of pay for 2015-16 from escrow loss

[get_snippet] [theme-my-login show_title=0]
Charles LeClaire, USA Today

Fourteen percent. That's how much all NHL players lost from their base salaries in the 2015-16 season, NHL sources tell BSN Denver.

NHL players had 17-percent of their base pay deducted by the league that season to cover escrow guarantees to the owners. Depending if the NHL hit revenue projections or not, players get some, all or a surplus of that escrow money back when the books are all settled.

It's important to note the players triggered the 5-percent escalator clause, allowing the salary cap to go up in a year in which revenues did not meet their initial projections. Because the salary cap went up in a year it might otherwise have stayed flat, that five percent was applied to the escrow.

The books for the 2015-16 season were settled within the past week, and the numbers aren't pretty for players. According to sources, players only got 3-percent of that money back, meaning they took a 14-percent loss on their salaries from that season, on top of all their other payroll deductions.

Players and their agents definitely are not happy about it. One player agent told BSN Denver that the escrow issue will be the "hill the players are prepared to die on" when the current NHL collective bargaining agreement expires in 2022 - although there are "opt-out" windows for the NHL and players in September of 2019.

A player making, say, $6 million for that season wound up losing $840,000, with no avenue to get it back.

The biggest reason why the NHL did not hit their revenue projections that season? Much of it can be attributed to a big drop in the value of the Canadian dollar. In 2016, the average exchange rate between the American and Canadian dollar was 37-percent, meaning it cost $1.37 in Canadian funds to purchase one American greenback.

The seven Canadian teams all take their revenues in their country's currency but pay player salaries and travel expenses in American dollars.

NHL revenues for the 2015-16 season were officially listed by the league at $4.1 billion. The salary cap for the 2016-17 season had the smallest increase - $1.6 million, from $71.4 million to $73 million - since the most recent lockout in the 2012-13 season.

The escrow deductions for this season, sources told BSN, are at 11.9 percent.

BSN'S A.J. Haefele contributed to this report



Not subscribed yet? Click below to for full access:

Subscribe