The minimum-wage, class-action lawsuit against the CHL is settled.
The official documents were filed in court on Friday, ending a six-year skirmish debating whether WHL, OHL and QMJHL players are “employees” or “student athletes.”
Executives across the CHL declined comment, as did attorneys from Charney Lawyers PC — which represented the plaintiffs. In an open letter the CHL said the agreed upon settlement was for a total of $30 million and several sources say each CHL team will be responsible for paying approximately $250,000 in damages. Some clubs can handle that easier than others, but it is not an insignificant amount at a time when the COVID-19 shutdown is wreaking havoc on businesses worldwide.
The total team payouts amount to approximately $15 million, with the league and insurance covering the rest.
Open letter to the #CHL community:
Continuing our focus on being the best major junior development league in hockey for our amateur student athletes.
— CanadianHockeyLeague (@CHLHockey) May 15, 2020
Those who played between 2010-19 were eligible to join the lawsuit. It is uncertain how much each plaintiff will receive. In 2017, Dan Robson reported for Sportsnet they were seeking “$180 million in back wages, overtime pay, vacation pay, as well as punitive damages.”
The plaintiffs argued junior hockey contracts were an actual employment contract, entitling them to minimum wage and the benefits described above. The CHL’s defence was that players were student athletes, and that its education package, development, equipment and off-ice programs exceeded what would be earned via minimum wage.
As the lawsuit progressed, every Canadian province, along with the states of Michigan and Washington, exempted CHL players from employment standards statutes. Alberta was the most recent to do it, effective Jan. 1, 2020. That will prevent future lawsuits from post-2019 players, and it stirred up internal debate about whether or not to continue fighting this suit.
There was a belief the provincial changes showed the CHL to be on the right side of the law, but legal advice indicated the case could continue for up to another decade. That would cost millions in fees and, according to sources, the insurance fund topped out at $30 million. Clearly, that was a major factor in deciding to settle the case.