The Ontario Hockey League says its teams may have to pare back their drug education, anti-doping, concussion management, and medical and dental programs if the league loses a minimum-wage lawsuit, according to a new court filing.
The OHL made the claims days before it appears in Ontario Superior Court on Tuesday to begin a hearing into whether a lawsuit filed against the league by former players should be certified as a class action.
Last month, a judge in Calgary oversaw a hearing into a similar claim filed by players against the Western Hockey League. That judge has not yet decided whether that case should be a class action, meaning hundreds of players would automatically become plaintiffs, raising the league’s potential liability.
The decision on class certification in the WHL case will not impact the OHL lawsuit.
Another proposed class-action lawsuit has been filed in Montreal against the Quebec Major Junior Hockey League, although a hearing date in that case has not yet been set.
In the Ontario action, the players argue that the OHL has become a big business where 20 teams generated a collective $66.5 million in revenue in 2016. The plaintiffs contend that paying players minimum wage would amount to $287,500 per team per year, or a collective $5.75 million expense for all 20 OHL teams.
The OHL contends that paying players would be the ruin of some clubs.
In a factum delivered to lawyers for the plaintiffs on March 14, the OHL’s attorneys wrote paying players minimum wage is an expense teams cannot afford.
“OHL teams spend tens of thousands of dollars on each player annually to cover the costs of all equipment, sticks, skates, coaches and trainers, meals, transportation, accommodations, reimbursements of player expenses and all tuition fees, text books, compulsory fees, tutoring costs for current players, fees for the academic advisors, insurance premiums, and billet payments,” the OHL’s lawyers wrote.
“Teams also incur the costs of all of the health and welfare programs provided to players, including the costs of the CHL Drug Education and Anti-Doping Program, Concussion Management Program, and the costs of any medical and dental services the players require during the season. Many teams will have to reduce these benefits in order to be able to afford paying employment benefits or the teams will cease to exist.”
“The issue for the league is not whether to pay minimum wage or not, OHL commissioner David Branch told TSN via email. “The issue for the league is the changes we would have to make to our current player experience package if we were required to pay minimum wage.”
While the OHL said programs such as the concussion management program might be cut if it loses this litigation, the plaintiffs said in a rebuttal emailed to the defendants on March 18 that the NHL has largely subsidized the OHL’s holistic services.
“These services were initiated very recently in response to media concerns over a climate of concussions from fighting and player stress from being uprooted from home and lack of ice time,” the plaintiffs wrote.
“…The vast majority of the benefits which the defendants claim are threatened are not true player benefits. It would be impossible for the league to operate without coaches, away games, billeting, equipment, etc. Accordingly, the likelihood of these ‘benefits’ being cut is virtually nil.”
The plaintiffs also wrote that the education package offered to players also cannot be characterized as a “player benefit.”
“It too is effectively a cost of doing business for OHL clubs, and is therefore unlikely to be cut,” the plaintiffs wrote. “Since the OHL must compete with [U.S. college teams] for teenage hockey players, the education packages are necessary. Absent the education package, many top players will opt to go to the NCAA rather than the OHL.”
The OHL wrote in its 93-page factum that the case should not be certified because former players who are pursuing action against the leagues don’t represent the interests of current and future players.
“Current and future players have an interest in safeguarding their hockey opportunities and the range of benefits they receive while playing in the OHL, benefits that that are entirely dependent on the financial viability of the teams and that would be jeopardized by certification of this action,” the OHL wrote. “Former players, like the proposed representative plaintiffs, have a fundamentally different and conflicting interest. They have nothing to lose by seeking retroactive wages.”
The OHL also included testimony from the parents of several players who support the status quo in major junior hockey and who say that playing in the league made their children better people.
The league cited the testimony of Kelly Mercer, whose son Luke played with the Niagara IceDogs for five seasons, beginning in the 2010-11 season.
“[Luke] and his family grew close to the team, including with the owners, Bill and Denise Burke,” the OHL wrote. “When Luke’s grandmother died, the Burkes attended the funeral and showed a memorial on the video board at a game in her honour. The Burkes also hosted social events for the parents of players, including a wine tour for the mothers.”
“Kelly Mercer’s affidavit is reflective of what we continually hear from our parents,” Branch told TSN. “If given the choice between minimum wage and the current player experience package/education program for their son, they would choose the current player experience package.”
In their response, the plaintiffs highlighted millions of dollars in revenue generated by the Canadian Hockey League, the organization under which the OHL, WHL and QMJHL operate.
The plaintiffs wrote that the CHL generates $25 million per year from 22 corporate sponsors, and garners millions more from the NHL through a development grant that paid the CHL $11 million in 2016.
Of the CHL’s revenue in 2016, the plaintiffs say $12.7 million was not distributed to its member leagues.
Moreover, the plaintiffs said the CHL teams have insurance of at least $30 million and as much as $41 million – money that could be used to pay out a judgment and help teams avoid bankruptcy.