The NHL and NHL Players’ Association have agreed to change this season’s escrow rate to 20 percent, sources confirmed to ESPN.com.
That’s up from the 10 percent rate both sides had agreed upon in late January shortly after the season began.
The change comes as a result of lower than originally projected NHL revenues for the lockout-shortened season.
That means players, as of this week, will fork over 20 percent of every paycheck into an escrow fund until both the league and NHLPA figure out the final numbers next summer or next fall in terms of hockey-related revenue.
If players’ compensation does not go higher than their 50 percent HRR allotment for the season, they will be refunded the escrow payments with interest.
However, if the players’ compensation exceeds the 50 percent share, the owners will be paid the escrow money.
The NHLPA has another option if its executive board wishes to dip into the $300 million “make whole” fund, which owners are paying out to players as per the new CBA over the next three years.
The players negotiated the make whole fund as a protection against high escrow eroding their salaries.
Normally in an 82-game season, the two sides review the escrow rate each quarter. But with the shortened, 48-game season, both sides agreed before the season to review revenues and revenue projections throughout the season to determine whether the escrow percentage coming off player checks needs to be changed.
Most years, the players get some of the escrow money back, and sometimes all of it. Here’s how the escrow worked out once the final HRR numbers were finalized each season:
2005-06: The net result was that each player earned 104.64 percent of his 2005-06 contract (includes the shortfall and interest). Players’ share was 54 percent of HRR.
2006-07: The net result was that each player earned 97.51 percent of his 2006-07 contract. Players’ share was 55.6 percent of HRR.
2007-08: The net result was that each player earned 100.66 percent of his 2007-08 contract. Players’ share was 56.7 percent of HRR.
2008-09: The net result was that each player earned 87.12 percent of his 2008-09 contract. Players’ share was 56.73 percent of HRR.
2009-10: The net result was that each player earned 90.59 percent of his 2009-10 contract. Players’ share was 57 percent of HRR.
2010-11: The net result was that each player earned 97.7 percent of his 2010-11 contract. Players’ share was 57 percent of HRR.
2011-12: The net result was that each player earned 99.48 percent of his 2011-12 contract. They got back just under 8 percent of the 8.5 percent they paid in escrow during the year. Players’ share was 57 percent of HRR.
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