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The Arbitration Dilemma

With the announcement that Andrej Sekera has filed for salary arbitration, Pegulapalooza came to an abrupt end for Sabres fans. Realizing that the acquisitions of Robyn Regehr, Christian Erhoff and Ville Leino had put the Sabres right up to the the league salary cap with 3-4 roster spots still needing the expected starters to be signed.

Besides Sekera, Jhonas Enroth and Marc-Andre Gragnani are restricted free agents that need to be resigned. If Luke Adam or another young player were to make the team during training camp they would need more space to put that player on the roster.

This has Sabres fans up in arms. Salary arbitration has left a sour taste in the mouths of fans due to last season’s loss of Tim Kennedy. Many fans have decided that players shouldn’t opt for arbitration and that those who do are greedy and selfish. It also makes fans nervous about cap space. Many feel that the Sabres could be in trouble this season and might struggle to resign Tyler Myers and Tyler Ennis next season.

Let’s clear up some misconceptions:

First I would like to explain how arbitration works. For starters, a player must be eligible for arbitration, this is based on age, when a players first contract is signed and number of professional seasons and games. Next a player must file before July 5th. A date will then be set in late July or early August for the Arbitration hearing.

The next step is the hearing. Player and team representatives meet in court and present the contract that they think is fair and then both sides have 90 minutes to argue their case. This includes witnesses and evidence and is handled in the way as any court case.

Both parties sign an agreement to abide by the decision of the court. However if a contract is above $1,042,173 per year then the team has 48 hours to walk away and the player would become an unrestricted free agent. A player is generally granted a salary based on the salaries of “comparable players” in the NHL and may be given a 1 or 2 year contract.

Now that we understand the nature of the beast a little bit more we can start to understand the Sekera dilemma. However to say that his filing for arbitration reflects poorly on his character or makes him disloyal is just wrong. First of all player elected arbitration is a right that the player fought to have included in the last collective bargaining agreement.

The reason they wanted this was to use it as a negotiating tool and to allow them to control their own destinies a bit more. Restricted free agency was added so the owners could control their younger players and keep total cost down. Arbitration was to help those young players that have experience and don’t feel they will get what they deserve.

Now remember players have to file before July 5th. Chances are Andrej Sekera would love to get a deal done before his hearing on the 25th of July and is working hard to reach an agreement, but if he didn’t file he had a lot of his leverage in negotiations taken away.

Many people say that athletes are greedy and just try to get as much money as they can and some of them are, but there is more to the picture then what most of us see. Players must live for a lifetime on a salaries from an average career of 10-15 years. They need to make a lot of money to cover the rest of their lives.

Remember too, that they earn their contracts before they play a game for the team who signs them. Tyler Myers is earning his next contract now, he earned his last one while playing junior hockey. Many people complain that players don’t play up to their contract, but they aren’t playing for that, they are playing for their next one.

Also keep in mind that Andrej Sekera could lose his entire career on his first shift in 2011. While none of us wish that on him, the list of players’ careers cut short by injury is far too long. Imagine going to work tomorrow and sustaining an injury that makes it so that you can never work your job again and that everyone in the office is actively trying to inflict that injury on you. Scary huh?

That is why players demand so much money, so they have something for themselves and their family to live on while they make the transition to some other form of income. Andrej Sekera is no different from the other 19 players that filed for arbitration. By the way, five of those players have already been resigned.

That being said, the money that Sekera might command from a hearing has rightly spooked a lot of people who know this organization. With the money that is being given to defensemen in the current NHL makes signing Sekera to a reasonable deal nearly impossible. With the limited cap budget that the Sabres have, that could turn this into a very sticky situation.

Fans are clamoring for Buffalo to sign Sekera for “$1.5-$1.75M”, I hate to break it to you Sabres’ fans but that simply isn’t happening…ever. He received a 2 year deal worth $750,000 in the first year and $1,250,000 in the second for a cap hit of $1,000,000. He will get a hefty raise.

Some fans are saying “anything under $2.5M”. This is slightly more plausible, but still rather unlikely. This would be an outcome for the Sabres if they could sign him to a deal before July 25th. A 3-4 year deal that involved a bit of cap circumvention might make this a possibility. It is highly speculated that the length of contract is one of the most contentious for the two sides as they try to sort out a deal.

Like I said, the arbitration result is usually based on comparable players. Stats are a huge part of this. Sekera posted reasonable stats this season with 29 points in 76 games. if we look at some players that had similar numbers this season we have: Bryan McCabe, Cody Franson, Staphane Robidas and Dion Phaneuf. McCabe being contract-less helps the Sabres immensely. The case can be made to throw out Robidas and Phaneuf due to the way their style of play and Franson is still on an RFA contract. All of this saves the Sabres money.

Unfortunately, there are some other comparable players that will apply. Those are: Marc Staal, Eric Johnson and Trevor Daley. All of these players had similar stats to Sekera this year and have signed a recent contract. The troubling part is that not one of them signed for less that $2.6M, that is the salary of Johnson which he was awarded in arbitration. Staal was awarded $3.975M in arbitration. Daley was given a $3.3M extension, all of these deals were last season.

If you average out these deals you find that Sekera might be awarded a deal closer to $3M. While many fans would advocate trading “Reggie” now or walking away from such an award, I would advocated patience. First off, Darcy Regier has said that there was a framework in place to get a deal done before the 25th.

In fact, when Sekera’s agent reported that his client had signed he mentioned that both sides were confident that a “long term deal” would be worked out. He even said “filing for arbitration on Sekera is a continuation of the process in the CBA as both sides continue to negotiate a longer-term contract.”

So the assumption is clearly that Sekera will not even make it to his hearing date on July 25th. Whether or not Sekera goes through the hearing or not, we can assume he will make somewhere between $2.5-$3.5M next season. So the next question is: is that too much?

The Sabres have bolstered their defense corps and have a very strong top-4 in Myers, Erhoff, Regehr and Jordan Leopold. They have also resigned Mike Weber to be the 6th defenseman. Sekera returning would really make this defensive unit something to be reckoned with. He was the Sabres top D-man for two stretches last year, and now he would be their number five defenseman. He would also be given a shot to gain consistency in a reduce role while playing with a player that he used to have a ton of chemistry with in Mike Weber.

Marc-Andre Gragnani is touted as a replacement, but he hasn’t seen as much NHL time as Sekera and could serve as an ideal extra defenseman/Forward while he works his way into the lineup, Drew Schiestel, T.J. Brennan and Brayden McNabb will all push for spots, but would serve the Sabres better as injury call ups.

So Sekera is useful, but is it even possible for the Sabres to keep him? As of this moment Buffalo has enough money invested in 1-way contracts to prevent them for signing a player at the league minimum. However that is assuming that Shaone Morrisonn and Ales Kotalik will play on the opening night roster, which they won’t.

If the Sabres ship Kotalik and Morrisonn down to Rochester then they will posses $5,429,643 in cap space. Assuming that Sekera takes up about $3M that still leaves Regier over $2M to work deals with Gragnani and Enroth. Signing Drew MacIntyre helps with the Enroth negotiations, although he has reportedly turned down deals as high as $650,000 they will eventually reach a deal and Gragnani will likely only get a minor raise as well. If Luke Adam plays well enough to make the team a forward can be traded or waived at that point in time. Buffalo isn’t as bad off as it initially seems.

Essentially what I am advocating is patience. Let the process play itself out. This is a minor bump in the road. Sekera can still resign. If he doesn’t, they can trade him, if they don’t then maybe their representatives get a favorable deal from the judge at arbitration, if they don’t they can still walk away.

Sekera is simply following the guidelines of the CBA, in the same way that the Sabres did when they extended their frequently insulting qualifying offers. It’s part of the business and in Pegulaville, business is good!

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