Craven Morehead said:
Do all players who file for arbitration make under thge league average??? If they don't, I thought they only get qualified and don't receive get the 10% increase for making less then the league average, so wouldn't that mean 'not every' case means there is an automatic raise necessarily???
Players who make more than the ALS receive a qualifying offer, too. It just doesn't include the 10% raise. Arbitration is a process that is designed to ensure fairness in a process when a player is forced to negotiate with one team.
In most cases, contracts are very easily settled. The player either accepts the qualifying offer (or the team cuts the guy loose without qualifying him) or the team and the player agree to a value.
What about when there is no agreement? The player has an option of a holdout or arbitration. In arbitration both sides submit a case. The arbitrator is supposed to award a contract that is "market value" for the player. In other words, Brendan Morrison is supposed to be awarded a salary that is about the same as comparable players at a comparable stage in their careers. The result is binding on the player, but not binding on the team.
Players win the right to arbitration after five years in the NHL. Those first five years the salary is controlled by the entry level system. As a result, player salaries across the league double at about age 25 when the player wage is no longer constrained. We would expect, therefore, that arbitration awards to players filing at the first opportunity would also on average double.
(That's what is so bogus about the NHL and Bill Daly on this subject. Daly points at the awards and says "Look! Arbitrators double the salaries of players who file!" That is meaningless because the salaries of players who don't file also double.)
The process in the Morrison case if the media reports were correct went like this:
1) The Canucks made a timely qualifying offer of $725,000 to retain Morrison's rights and opened negotiations. Morrison rejected the offer and demanded Radek Bonk-Jeff O'Neill money.
2) Negotiations stalled with the parties about $500,000 apart. The Canucks were offering $2.5 million, Morrison wanted $3 million. Morrison files for arbitration.
3) Morrison submitted a demand for $3.5 million to the arbitrator and cites his comparables. The Canucks submit $2 million claiming Morrison did not have nearly the career statistics of Bonk and O'Neill - he had only one year at theirv level of production - and claiming that Morrison benefited more from his linemates.
4) The team can choose to make awards one year or two. The Canucks chose two and arbitrator awarded $2.25 million and $2.5 million.
The Canucks were delighted. Morrison would have done better if he accepted the Canucks last offer and passed on arbitration. This year the Canucks and Morrison agreed to a $3.55 million deal without going to arbitration.
I'm starting to think its irrelevent that a "winner" is declared. The bottom line is that Morrison still got more money then what the final Canucks offer was, which you said was $2 million. Its still inflationary from what I can see. Is there something else that I am missing(there is no sarcasm in there, a genuine question)???
It is possible that the arbitration system drives up salaries. It is not supposed to drive them up, but a flawed system could have that result. The key question to determine whether that is the case is "Have the awards been, on average, for more than the market value of the player? Do the awards follow a league wide standard or do they set a standard?"
I have studied the system carefully because I have completed arbitration briefs for a player agent. I don't believe the awards have been, on balance, for more than the player is worth given the prevailing market. I can only think of one award that set a standard in ten years.
Keep in mind that the NHL (and the NHLPA) have the right to fire any arbitrator without cause. If they don't like the decisions, they can get rid of the arbitrator. The worst single decision made was Bryan McCabe's first award and the NHL immediately - and correctly in my view - fired the guy. They agree to the arbitrator and they can the incompetent ones.
Have the awards been, on average, for more than the market value of the player? I don't think so, but my opinion is anecdotal. The point is that anyone with a passing knowledge of statistical analysis could devise a dozen ways to test whether NHL arbitration awards followed the market or set the market.
If the NHL was serious about arbitration as an issue and they see it as a real problem, they do a statistical study, present it to Goodenow and say, "Something is wrong. Look! Arbitration awards are setting market value and they are supposed to be reflecting it."
Why don't they do that? I think the most reasonable answer is that the owners don't really care about arbitration. They care about getting a salary cap system and the premise is "We need a salary cap system because the existing CBA doesn't work."
How do we know the CBA doesn't work? Because the arbitrators double player salaries! Gasp!
Tom