What Is Arbitration In NHL? Learn More About Player Contract Disputes

If you are an avid fan of the National Hockey League (NHL), then you may have heard about player contract disputes and how they are resolved. One way that NHL players can settle these disputes is through a process called arbitration.

Arbitration is a type of alternative dispute resolution where a neutral third party, known as an arbitrator, listens to both sides of the dispute and makes a decision based on the evidence presented. In the case of the NHL, the arbitrator is typically appointed by the league and the NHL Players’ Association.

In this article, we’ll delve deeper into what exactly arbitration in NHL entails, including how it works, when it’s used, and some examples of recent cases. We’ll also explore the pros and cons of opting for arbitration versus other methods of resolving contract disputes.

“If you want to learn more about the fascinating world of arbitration in NHL and gain a better understanding of how it impacts player contracts, keep reading!”

Whether you’re simply curious about how things are done behind-the-scenes in professional hockey or you’re a diehard fan with a vested interest in player contract negotiations, this article aims to provide a comprehensive overview of the topic at hand.

The Basics: What is Arbitration in NHL?

Definition of Arbitration in NHL

Arbitration is a legal process used to settle disputes between teams and their restricted free agents (RFAs) in the National Hockey League (NHL). When a player’s contract expires, they become an RFA, which means that while they are not completely free agents, they have some restrictions on their movement. They can sign with any team they want, but the original team has matching rights. If they cannot come to an agreement, then they may go into arbitration.

According to the official NHL website, “arbitration takes place when the Club submits a salary offer to a Player coming out of his Entry Level or who has less than ten years of NHL experience as an unrestricted free agent.” The player then has the option to accept the offer or file for arbitration. During the arbitration process, both parties make their arguments before an arbitrator, who ultimately decides on the player’s new contract based on factors such as performance, role on the team, and comparable players around the league.

Importance of Arbitration in NHL

When it comes to negotiating contracts in professional sports, arbitration is considered to be a valuable tool for settling disagreements fairly and objectively. In the NHL, arbitration helps resolve issues between clubs and RFAs by providing structure and balance to negotiations. It ensures that players are paid what they deserve based on their value to the team and their contributions on the ice.

Arbitration also allows general managers to plan their future budgets more effectively. Because contract decisions aren’t left entirely up to negotiation, GMs can anticipate how much money will be allocated towards each player’s contract and adjust their spending accordingly. This is particularly important for small market teams that operate under strict budget constraints.

“Arbitration is really a last resort for any club and player, but it’s an important part of the sport because it ensures fairness,” says NHL Commissioner Gary Bettman. “It provides a way for teams and players to avoid stalemates in negotiations and come to a resolution that satisfies both sides.”

Arbitration helps keep the league competitive by ensuring that talented players are compensated fairly. It promotes stability and transparency in contract negotiations while allowing RFAs to have some agency over their future, which benefits everyone involved – from the players to the fans who watch them play. For these reasons, the use of arbitration in the NHL has become commonplace and continues to be an essential tool for maintaining a healthy and thriving league.

How Does Arbitration Work in NHL?

The arbitration process is a way for National Hockey League (NHL) players and teams to settle contract disputes. The following sections will outline the steps involved in the arbitration process.

Request for Arbitration

A player can request salary arbitration if they meet certain criteria, including being eligible for restricted free agency or having been offered a qualifying offer by their team. A player must file for arbitration within a specific period after receiving an offer from their team. If the player does not file for arbitration within this window, they forfeit their right to request it.

An arbitrator has the power to award the player a one- or two-year contract. Once the player files for arbitration, the team has the option to either accept the player’s filing or “walk away” from the decision and allow the player to become an unrestricted free agent. If the team chooses to walk away, they forfeit the right to negotiate with the player until January 1st of the next year.

Selection of Arbitrator

Once both parties have agreed to enter arbitration, the next step is to identify an arbitrator who will hear the case. The NHLPA and the league each provide a list of arbitrators that they believe are neutral and qualified to handle the case. From these lists, the two sides then come to an agreement on an arbitrator who they feel will be impartial and objective.

Pre-Hearing Procedures

Before the arbitration hearing takes place, there are several procedures that need to be followed. Both parties must exchange briefs before the hearing starts. The purpose of these briefs is to give each party a chance to explain its position in writing.

The team and the player each submit a brief that outlines the contract they would like to have. These briefs also contain statistics and other relevant information that supports their position. The arbitrator will rely on these briefs when making a decision.

The Arbitration Hearing

Once both parties complete exchanging the written arguments, the hearing begins. It is typically held in person and lasts between two and four hours. During the arbitration hearing, each side presents its case orally before the arbitrator. Both sides are allowed to present witnesses and experts who can provide evidence supporting their argument.

The arbitrator listens to both sides’ arguments, reviews the written briefs, and considers any additional evidence presented during the hearing before issuing an award. The award is usually issued within 48 hours after the hearing concludes.

“The whole point of salary arbitration at this point was to prevent situations where teams could engage in negotiations with players purely for posturing purposes.”

-Ken Campbell, The Hockey News

Arbitration is an essential tool used within the NHL to settle disputes regarding player contracts. While it may not be a perfect system, it has proven effective in solving disagreements between teams and players, allowing them to move forward together.

When Can a Player File for Arbitration?

In the National Hockey League (NHL), players have two opportunities to file for arbitration – either as a restricted free agent (RFA) or an unrestricted free agent (UFA).

Restricted Free Agents

A restricted free agent is deemed to be in this position, after finishing their entry-level contract, but not yet meeting the requirements to become an unrestricted free agent. For most RFAs, they must have completed seven years of professional service before reaching UFA status.

If an RFA has received an offer from another team, there are some conditions that must exist for them to file for salary arbitration. First, the player’s former team must elect to retain the player by extending a qualifying offer, which preserves the club’s right to match any competing offers. Second, if the offer meets certain criteria, it may trigger a level called a Salary Arbitration Eligible Contract (SAEC). This SAEC will allow both the team and the player to enter into negotiations to agree upon a new contract or attend an official hearing where an arbitrator would then determine what the appropriate amount of compensation should be.

If the player decides to file for arbitration, the window typically opens on July 15th and expires four days later. Within this window, the player must provide written notice to all relevant parties: the NHL Players’ Association (NHLPA), the former team, and the league itself. If the window passes without filing, the opportunity vanishes and the player proceeds under a pre-existing arrangement with the team in question.

Unrestricted Free Agents

An unrestricted free agent (UFA) is one who is not bound to his or her current team and can sign with any team once the free-agent period commences. In this situation, a player must wait until the free-agent period begins on July 1st to file for arbitration. If they sign an offer sheet with another team, or their previous team submits a qualifying offer in line with the CBA regulations, they can pursue arbitration within four days starting from the date of notification.

Barring mutual agreement between both parties not to attend the hearing, an arbitrator will hear arguments presented by the team and the player’s representatives before making a final decision. Typically, less than ten percent of RFAs and UFAs reach full arbitration hearings because most are able to come to terms through other negotiations prior to that step occurring.

“Overall, salary arbitration offers players and teams alike a fair process for determining compensation amounts,” states the NHLPA website. -NHLPA

Arbitration is designed as a neutral forum for resolving financial disagreements between teams and their restricted or unrestricted free agent athletes. The key takeaway is that presence of an arbitration-eligible contract does not mean that a player must enter into arbitration proceedings – rather it paves way for more constructive conversations about contract parameters that could culminate in a settlement approved by all stakeholders outside of the courtroom setting.

What Happens During the Arbitration Hearing?

In the National Hockey League (NHL), arbitration is a process that allows for player contract disputes to be resolved. It’s a formal hearing where both parties, the team and the player, present their arguments in front of an independent arbitrator who makes a binding decision on the terms of the new contract.

Opening Statements

The hearing begins with the opening statements from both sides. Typically, the representative for the team goes first. They provide an overview of why they believe the player deserves the proposed salary amount and may discuss factors such as the player’s performance, age, experience, impact on the team, and comparables (similar players at similar levels around the league). Then, it’s the player’s turn to deliver his statement, outlining why he believes he deserves more money or more years than what the team has offered.

Player’s Case

After the opening statements, the player presents evidence supporting his request by providing statistics, athletic accomplishments, endorsements, overall contribution to the team locker room environment and relationship with teammates, and possibly personal circumstances outside of hockey that affect their value to the team. The goal of the presentation is to persuade the arbitrator that the team’s offer did not represent fair market value when compared to players of comparable status,

• Performance – Players can argue for increased compensation if their performance exceeded the expectations and resulted in individual accolades. For instance, Alex Ovechkin won the Maurice Rocket Richard Trophy seven times whose former record was shared by Jarome Iginla and Brett Hull who are known around the league to have made a significant financial earning over their NHL career.
• Demonstrate Comparable Contracts – Agents and lawyers generally compare athletes who have equivalent attributes regarding their time spent in the league, position, and past performance statistics.

Team’s Case

In response to the player’s case, the team has a chance to rebuttal the presentation by pointing out any inconsistencies in the evidence presented. Additionally, the team can state their side of arguments; this includes showing how the team values the player’s impact on the ice compared to other players—offering alternatives similar to the comparables that have been shared previously, or maybe applying some analysis to compare league trends to historic issues. It is at the discretion of the legal representatives which arguments they want to present based on what constitutes the best strategy for convincing the arbitrator.

Closing Statements

The final stage of the hearing is closing statements where both sides summarize their key points. Instead of presenting new information, each representative will repeat essential pieces from previous presentations. This phase requires professional attention to appeal to the emotion of the arbitrator so that he/she makes the decision more favorable to their client’s argument. The options are selected from which ever party presents stronger assessments since it affirms desirable qualities such as consistency, persuasive skills, facts over opinions.

“The arbitration process tends to push NHL teams toward resolving deals with restricted free agents before it gets to this point because arbitrated salaries often come in higher than those agreed upon beforehand.” -Lance Hornby, Toronto Sun reporter

Arbitration hearings are not always ideal for either party due to its formal nature. Any challenges created within the negotiations remain public no matter who wins or loses. As a result, contracts reached through an agreement between two parties are usually preferred while creating goodwill keeping negotiation matters private.

The arbitration process provides an opportunity for both NHL teams and players to resolve disputes regarding player contracts. They provide opening statements, and then each side uses supporting evidence to argue their case after which a binding decision is made by the arbitrator, who sets the contract terms for the upcoming season(s). No matter how successful someone is in life; an excellent lawyer can be proof of a considerable value that can help manage and prepare anyone through complex situations.

What Are the Possible Outcomes of an Arbitration Hearing?

Award for the Player

If a player and his team cannot come to an agreement on a new contract during negotiations before arbitration, the case will go to an arbitration hearing. During this hearing, both the player and team present their cases to an unbiased arbitrator who will decide which side’s offer is more reasonable.

If the arbitrator decides in favor of the player, he will be awarded a salary based on his performance and comparable players within the league. This award can only be a one-year deal unless both parties agree otherwise. The player then becomes a free agent at the end of that one-year deal or if the team chooses not to tender him a qualifying offer, making him an unrestricted free agent.

“The outcome for most hearings sees players getting salaries near where they anticipated given what others have received in free agency and how they compared to similar peers.” -Elliotte Friedman, Sports analyst for NHL Network

Award for the Team

The arbitrator may also decide in favor of the team and award them a contract lower than what the player requested. If this happens, the player must either accept the contract or become a free agent.

In some rare cases, the arbitrator may also decide to give the team a “walk away” right. This means that even though the arbitrator awarded a certain amount, the team has the option to decline the award and allow the player to become a free agent instead.

“The two sides generally know going into business arbitration what the potential outcomes are with precedence set by those advanced negotiations between teams, agents and impending UFAs over the course of several months when everyone works out of draft-day hotels.” -Greg Wyshynski, Senior NHL writer for ESPN

Settlement Agreement

In some cases, the player and team may reach a settlement agreement before or during the arbitration hearing. This means that they will come to an agreement on a contract without the arbitrator’s involvement.

Settlement agreements can occur at any point in the arbitration process but most commonly, just before or after the hearing begins. In some cases, the arbitrator may encourage both sides to work out their differences together and present him with a signed contract for his approval. This saves time and money spent on the actual hearing itself.

“This type of fate is reserved for only those players who are actually headed toward into an arbitrated proceeding – if not necessarily always a full-on trial.” -Scott Burnside, Senior Digital Correspondent for The Athletic

The arbitration process can be difficult and sometimes contentious for all parties involved. However, it serves as an important tool in helping players receive fair compensation based on their performance within the league. While there is no guarantee of success during the arbitration hearing, both players and teams have found favorable outcomes in the past through this process.

Examples of NHL Players Who Have Gone Through Arbitration

Brock Nelson

Brock Nelson, a center for the New York Islanders, went through arbitration in 2019. The dispute was over his contract for the upcoming season and he ended up signing a one-year deal worth $4.25 million.

Nelson had scored at least 19 goals in each of the previous four seasons and wanted to be paid accordingly. However, the Islanders were hesitant to give him a long-term deal due to salary cap concerns.

“It’s a tough process,” Nelson said at the time. “You don’t know how it’s going to play out…. I’m just happy to get this all figured out.” -Brock Nelson

Robin Lehner

In 2018, goaltender Robin Lehner underwent arbitration with the Buffalo Sabres. He ended up signing a one-year deal worth $4 million.

The dispute centered around Lehner’s injury history and inconsistent play. Despite suffering from concussion issues and other injuries throughout his career, Lehner believed he deserved a higher salary.

“It’s difficult,” Lehner said of the arbitration process. “I think everyone does their job. It is what it is. I let them do their thing; I have my representatives.” -Robin Lehner

J.T. Miller

Forward J.T. Miller went through arbitration in 2017 while playing for the New York Rangers. He signed a two-year deal worth $5.5 million per year.

The dispute revolved around Miller’s value to the team and his potential as a top-six forward. Ultimately, he received a larger payday than the Rangers had hoped for.

“It’s just part of the business,” Miller said of arbitration. “You come to terms with that when you become a professional athlete. It is what it is, and hopefully we can put it behind us now.” -J.T. Miller

In the NHL, arbitration is often used as a way for players and teams to settle contract disputes without going through free agency. This process typically takes place during the summer, before the start of the new season.

When a player files for arbitration, they provide a salary figure that they believe they are worth based on their performance and contribution to the team. The team then provides its own number, which may be lower than the player’s request.

If the two sides cannot come to an agreement, an arbitrator is brought in to hear arguments from both parties and make a decision on the player’s salary for the upcoming season. The arbitrator is not allowed to award the player more than a one-year deal, but the resulting salary can significantly impact the team’s salary cap situation.

While arbitration can be an effective way to resolve contract disputes, it can also be a contentious process that puts strain on player-team relationships. Additionally, it does not offer long-term security for the player, as they must go through the process again the following year if a multi-year deal is not reached.

Arbitration is just one aspect of the complicated world of NHL contracts and player negotiations. While some cases end peacefully like Brock Nelson’s, others can lead to tension between the player and team involved.

Frequently Asked Questions