Details of NHL, Players’ Association Agreement

The details of Friday’s agreement between the NHL and the Players’ Association are coming out. Here are the Cliff Notes:

  • A “long-term contract” is now defined as anything longer than five years.
  • The old rules (avg. annual salary) factors on contracts until the player is 40 years old.
  • The minimum salary used to calculate the cap number is $1M under the age of 40 (even if the base is less than that).
  • Over the age of 40, the actual annual salary is the cap number.

What this means is there would be two separate cap numbers for deals that extend into a player’s 40s. Here’s an exampls from

A 35-year old player agrees to a 7-year deal that is set to expire when the player is 42 years old.  The deal is set up as follows: $7.6 million for the first four years followed by $4 million in the fourth year, then two final seasons at $525,000.  Under the terms of the new amendment you would add up the first five years of the contract (to the age of 40) and calculate the average: $34.4 million divided by five years equals $6.88 million. That number would now be the player’s cap hit over those first five years. His cap hit in the final two years of his deal would be the actual value of the contract in those seasons, therefore a cap hit of $525,000 for years six and seven of the deal.

Per the agreement, the new rules are in place for any deal signed from this moment forward. Any deal signed previous to this arrangement, including Ilya Kovalchuk’s contract with the Devils (15 years, $100M) are grandfathered in.

What’s most important is that the Players’ Association and NHL worked together to get this deal done.

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