NHL Negotiations: Explaining Escrow and Why Players Despise It

This article on NHL escrow was written by my colleague over at Pittsburgh Hockey Now, Dan Kingerski.

The NHL and NHLPA will continue sparring and negotiating over league finances in an attempt to salvage the 2020-21 NHL season. Or, perhaps it’s now just the 2021 NHL season. As part of the five-year CBA agreement and NHL Return to Play that the two sides signed in June, the players agreed to a 20% escrow, which declined to 6% in the CBA’s final years.

In 2019-20, the escrow was 10%.

However, as CHN has reported on the new discussions, which NHL Commissioner Gary Bettman said were not renegotiations, we’ve noticed many fans don’t know or understand the “escrow” which players hate. I mean, the players absolutely HATE the escrow, and it was the primary contention for the new CBA.

As part of the new “discussions,” which are not “renegotiations,” the owners seek to raise the escrow in the CBA’s final years. The players won a concession, and the escrow will eventually drop to 6% in the latter years. However, the league is reportedly seeking to raise the 20% escrow this season, include increased deferrals, and increase the later years’ escrow to well above 6%.

What is escrow?

Every year, the players place a predetermined amount of their salary into an escrow account based on league revenue projections.

Let’s use 2018-19 as a normal example, and then you can extrapolate it to the 2019-2020 tidal wave of revenue losses.

Cue ominous music.