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Abel to Yzerman

Don’t forget that the NHLPA’s paying Wade Redden and Cristobal Huet’s salaries this year

New York Rangers defenseman Wade Redden cleared waivers today and finds himself heading to Hartford to play for the Wolf Pack (as of February, the Connecticut Whale) of the AHL, and as the Hockey News’s Ken Campbell has his predictable, “It violates the spirit of the CBA!” hissy fit and the CBC’s Elliotte Friedman and Yahoo Sports’ Greg “Puck Daddy” Wyshynski weigh in on the situation with less schadenfreude, no one seems to mention that when players on one-way contracts are waived and sent to the AHL (or, in Cristobal Huet’s case, Switzerland) to “bury” the player’s salary cap hits, it’s not the NHL teams who end up having to pay the cap hit. 

That money still counts against a team’s payroll, but once it disappears from the cap, who gets stuck with the eventual bill?  Why, the NHLPA’s members, of course, because one-way contractual money counts against “the players’ share” of revenues, as do salaries paid to injury replacements once teams exceed the cap via the Long-Term Injured Reserve exemption.  Are the CBA “hawks” like Campbell or the more moderate members of the media wringing their hands and gnashing their teeth about the concept that players both pay for general managers’ “mistakes” and, to some extent, have to pay the players who step up for their injured teammates?

Of course not.

During the Ilya Kovalchuk mess, I stuck with my guns and suggested that if nothing the Devils did violated the letter of the CBA’s law, it was and remains my opinion that the Devils didn’t do anything “wrong” by offering Kovalchuk a 17-year, $102 million contract because nothing in the CBA expressly prohibits any sort of term limit on contracts—unless you’re interpreting the “spirit of the CBA” as Richard Bloch chose to—and I’m not about to go back on my opinion and suggest that teams are doing anything “wrong” by clearing salary cap space via waiving players and sending them to the AHL. 

Nothing in the CBA prohibits this, and if teams want to utilize this option to help alleviate a cap crunch, that’s fine by me.  The rules the NHL and NHLPA agreed to play are nothing more and nothing less than, to use deputy commissioner Bill Daly’s term, not-so-“bright lines” that can be manipulated and to some extent exploited by NHL teams, and the same is true of the LTIR exemption.  If either party has a problem with the “spirit” of the CBA as applied in terms of the teams who may or may not utilize the tools available to them for the sake of establishing a competitive advantage, they should address these issues by collective bargaining and not the whims of arbitrators or members of the media crying foul.

At the same time, it must be underlined that it’s not the NHL that takes the financial hit in either situation.  Money NHL teams spend on one-way contracts which no longer count against a team’s salary cap figure still count against the players’ share, and as we all know, when teams exceed the 56-and-change-percentage of revenues which they’re required to spend on players’ salaries, the overage is paid back to the league by its players via escrow withholdings. 

When I mentioned this repeatedly this past summer, I found it hilariously ironic that no member of the NHL’s media corps, the passive-aggressive late-night Twitterer included, were willing to so much as utter a snappy comeback when their laments about players having to pay the brunt of the similarly-buried money hidden in the average value of lifetime contract-holding players’ salary cap hits were answered with this: “Sure, the players take a collective hit for the $15-20 million in funds that count against the players’ share instead of a team’s salary cap number, but it’s clearly met and exceeded by the salaries of players on one-way contracts who are sent to the AHL, never mind the players whose salaries are paid for by their peers thanks to the LTIR exemption”—and that’s the truth of the matter, and it comes as no surprise that the NHL-friendly media chooses to conveniently ignore this part of the equation.

The players’ escrow withholdings are largely drawn from AHL demotions, from both the Redden/Huet-range as well as the players who earn more meager salaries but find themselves ticketed for bus-riding, and the salaries of injury replacements accounted for by the LTIR exemption.  The similarly-buried dollar amounts which lifetime contracts account for are exceeded by a substantial margin by AHL demotions and LTIR exemptions.  That’s just how it works.

There’s nothing illegal going on in terms of violating CBA rules when GM’s pile as much of their cap management “mistakes” and injured players’ salaries onto the players’ share instead of engaging in player-purging gymnastics for the sake of the CBA’s supposed goal of competitive balance.  There’s nothing “wrong” with it, either.  The rules are the rules, and the players agreed to abide by them, too.  It simply merits highlighting, with a “bright line”-marking highlighter, that it’s not the NHL’s teams or owners who are fitting the bill in these sometimes incredibly expensive instances, especially on a cumulative basis. 

If we’re going to be talking about these issues ahead of the next round of CBA negotiations, we might as well tell the whole story instead of the part that’s convenient to furthering our respective points, and when we’re taking about contentious CBA issues, we should take players’ bones of contention into account as well.

Of non-NHLPA-related note: The Malik Report will launch sooner than later, so fear not: regular Red Wings coverage and long-winded commentary should resume shortly.

Update/edit 10:47 AM Tuesday: I’m sure someone has mentioned the fact that teams have to clear cap space for players who return from the LTIR, but I’m speaking very specifically about the many instances of season-ending player injuries, where teams can exceed the cap and don’t need to clear cap space to cover their cap-exceeding overage.

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Comments

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J.J. from Kansas's avatar

JJ, all those Wings guys you mentioned are on 2 way contracts, doesn’t the AHL team fot the bill for those?

Posted by Pharazon from England on 09/28/10 at 02:40 PM ET

Shit, you’re right.  Bad examples.  Derek Meech is also on Capgeek’s Non-Roster list and his contract is one-way.

Posted by J.J. from Kansas on 09/28/10 at 03:43 PM ET

PuckStopsHere's avatar

My understanding is that any player getting paid an NHL share of their contract by an NHL team counts toward the player costs.  A player on a two-way contract doesn’t count while in the AHL, but a player on a one-way contract does.  This is unless the league the player is playing in pays him.  If Cristobal Huet is paid by the Swiss league his whole $5.625 million, then it is not an NHL salary cost.  Of course, the Swiss League doesn’t pay Huet anywhere near that and Chicago makes up the difference in the salary (which is nearly his entire salary).

Thus all of Wade Redden’s salary and almost all of Huet’s are player costs and come out of escrow.

Posted by PuckStopsHere on 09/28/10 at 03:45 PM ET

Avatar

I think you are mostly correct. I think the caveat is how the NHL defines a “loaned” player. The CBA, as usual, is a little murky. It first says that everyone on the reserve list counts as part of the ACS, then it says, oh, well not loaned players.

Then when describing loaned players, it expressly talks about how the AHL is the only recognized minor league NHL players can be loaned to. But then there are vague passages where it makes reference to a player being loaned to a European club.

So, go figure… smile

Posted by Nathan from Jonny Ericsson’s ice cream truck on 09/28/10 at 01:54 PM ET

I agree this is one of the less clearly worded parts of the CBA - but the definition of “Loan” is not restricted to only “Minor Leagues”/AHL.

CBA Article 1 - Definitions

“Loan” means the transfer of a Player from a Club’s Active Roster, Non-
Roster, Injured Non-Roster or Injured Reserve List to the roster of a club outside the
NHL.

CBA Article 13.1

13.1 A Club shall not dispose of the services of any Player in which it has a proprietary
interest by Loan to a club of another league without first having complied with the
provisions of this Article. The Waivers that are recognized by this Agreement are
Regular Waivers, Re-EntryWaivers and Unconditional Waivers.

The CBA explicitly allows for ELS players to be Loaned to the ECHL - even though the ECHL does not meet the CBA definition of Minor League - and by implicatation allows for Loans to leagues outside of North America (13.23).

13.23 In the event a professional or former professional Player plays in a league outside
North America after the start of the NHL Regular Season, other than on Loan from his
Club
, he may thereafter play in the NHL during that Playing Season (including Playoffs)
only if he has first either cleared or been obtained via Waivers. For the balance of the
Playing Season, any such Player who has been obtained via Waivers may be Traded or
Loaned only after again clearing Waivers or through Waiver claim.

 

What makes up the “Non Roster List”?

Wouldn’t Redden & Huet be listed as Non Roster players while their salaries are being paid?

Posted by J.J. from Kansas on 09/28/10 at 02:19 PM ET

Basically the Non Roster list is for players who miss games for personal (ie non injury reasons) - birth of a child, etc - or players in the process of being waived (and waiting for waivers to clear).

Players on Loan do not qualify for the Non Roster List.

16.12 Non-Roster Player.

(a) Upon approval of the Commissioner, a Player who is unavailable to play
due to reasons other than injury, illness or disability (e.g., birth of a child, attending a
funeral) will be designated a Non-Roster Player, and during such period of his
designation as such he will not count against the Club’s Active Roster limit and his Club
may replace such Player, provided, however, that the Non-Roster Player’s Player Salary
and Bonuses and his replacement’s Player Salary and Bonuses are each included in
calculating a Club’s Actual Club Salary and Averaged Club Salary, and the Players’
Share, for purposes of Article 50.

(b) If, as a result of: (i) a Player (“Player A”) returning to a Club’s Active
Roster from Injured Reserve, or (ii) a Club acquiring a Player (“Player A”) via a Trade or
Waiver claim, the Club would exceed its twenty-three (23) man Active Roster limit then,
at the time the Player (“Player A”) returns to the Club’s Active Roster (in the case of (i))
or is added to the Club’s Active Roster (in the case of (ii)), the Club may request Waivers
on a different Player (“Player B”) and also the Club can simultaneously request Non-
Roster status for such “Player B.” Such request shall be made in writing by facsimile to
Central Registry, with a copy to the NHLPA, all in accordance with Exhibit 3. Upon
approval of the Commissioner, such “Player B” will be removed from the Club’s Active
Roster and the Club may replace such “Player B” with “Player A” on its Active Roster
pending the expiration of the Waiver period set forth in Section 13.18. During the period
of time “Player B” is granted Non-Roster status, both “Player A’s” and “Player B’s”
Player Salary and Bonuses are included in the Club’s Actual and Averaged Club Salary
and the Players’ Share for purposes of Article 50. At the conclusion of the Waiver period
for such “Player B,” if he has not been claimed, the Club must immediately (i.e. that day)
Loan “Player B” to the Minors.

(c) The Commissioner may take whatever steps he deems necessary to
investigate the circumstances under which a Player is placed, or remains, on the Non-
Roster List. If the Commissioner has reason to believe that Non-Roster status has not
been utilized properly by the involved Club, or that requests to designate a Player as Non-
Roster are or were in any way improper, or if he determines that the Club has used the
Non-Roster List to evade the Active Roster limit or otherwise Circumvent any provision
of this Agreement, he may take such disciplinary action against the Club as he deems
appropriate.

Posted by kdb209 on 09/28/10 at 03:53 PM ET

Avatar

My understanding is that any player getting paid an NHL share of their contract by an NHL team counts toward the player costs.  A player on a two-way contract doesn’t count while in the AHL, but a player on a one-way contract does.  This is unless the league the player is playing in pays him.  If Cristobal Huet is paid by the Swiss league his whole $5.625 million, then it is not an NHL salary cost.  Of course, the Swiss League doesn’t pay Huet anywhere near that and Chicago makes up the difference in the salary (which is nearly his entire salary).

Thus all of Wade Redden’s salary and almost all of Huet’s are player costs and come out of escrow.

Posted by PuckStopsHere on 09/28/10 at 02:45 PM ET

Nope.  There is no difference between a player on a one-way or two-way SPC.

If they are Loaned to the AHL (unless they fall under the 35+ yo rule), their salaries do not meet the definition of Actual Club Salary under 50.2(c) - all Players on the Club’s Active Roster, Injured Reserve, Injured Non Roster and Non Roster - and are explicitly excluded from the League-wide Player Compensation calculation.

It does not matter who is paying their salary or whether it is a two-way salary or not - if it is not explicitly meet the definition of Actual Club Salary under 50.3(c) it is not included.

Posted by kdb209 on 09/28/10 at 04:04 PM ET

PuckStopsHere's avatar

As far as the salary cap hit goes, you are correct.

As far as player costs for escrow goes, you are incorrect.  Redden is a non-roster player for the Rangers.

Posted by PuckStopsHere on 09/28/10 at 04:06 PM ET

Avatar

One last comment.

The criteria for inclusion in Actual Club Salary under 50.2(c)(i) is effectively identical to that for Average Club Salary under 50.5(d)(i)(B) - the players cap hit during the season:

(B) From the day following the last day of Training Camp until
and including June 30 of each League Year, “Averaged
Club Salary” for each Club shall be calculated as the sum
of the following amounts:

(1) The Averaged Amount of the Player Salary and
Bonuses for that League Year for each Player on the
Club’s Active Roster, Injured Reserve, Injured Non
Roster and Non Roster
; plus

There is no way that Redden’s & Huet’s cap hits could be excluded from their teams Average Club Salary (which we know they are, or there would be no purpose for the Loans and the Rags & Hawks would not be under the Upper Limit during the season) without also exluding them from their teams Actual Club Salary (and League-wide Player Compensation).

Posted by kdb209 on 09/28/10 at 04:15 PM ET

Nathan's avatar

As far as the salary cap hit goes, you are correct.

As far as player costs for escrow goes, you are incorrect.  Redden is a non-roster player for the Rangers.

Posted by PuckStopsHere on 09/28/10 at 03:06 PM ET

I’m not trying to be a stick in the mud… but can you substantiate that? Is Redden a non-roster player for the Rangers as of this moment, but if/when he reports to Hartford, he will then be considered a loaned player and thus kdb209 seems to have uncovered the answers…

Posted by Nathan from the scoresheet! on 09/28/10 at 04:20 PM ET

Avatar

As far as the salary cap hit goes, you are correct.

As far as player costs for escrow goes, you are incorrect.  Redden is a non-roster player for the Rangers.

Posted by PuckStopsHere on 09/28/10 at 03:06 PM ET

Then please explain how his cap hit goes away during the season - The averaged salary for Non Roster players is explicitly included in a teams Average Club Salary during the season (see 50.5(d)(i)(B) above).

His salary either counts in both Actual Club Salary and Average Club Salary or in neither.  There is no way you can parse the CBA to include it in one and exclude it from the other.

It is really pretty clear - Redden & Huet meet the definition of Loaned under the CBA and are thus explictly excluded from the Active Roster and meet no other criteria to be included in either Actual Club Salary or Average Club Salary.

Posted by kdb209 on 09/28/10 at 04:24 PM ET

PuckStopsHere's avatar

Average club salary, actual club salary and salary cap hit are three different things aren’t they?  You seem to have equated one of the first two with the last one..

Posted by PuckStopsHere on 09/28/10 at 04:31 PM ET

rrasco's avatar

*head explodes*

Posted by rrasco from TEXAS on 09/28/10 at 04:42 PM ET

J.J. from Kansas's avatar

Then I’m confused about 50.4 (d) (i):

Each Club shall withhold from each player who is party to an SPC with that Club (and current players who retire or otherwise cease playing for in the NHL to the extent such Players continue to be paid under an SPC with that Club, including, without limitation, Players who were party to SPC’s that have been bought out, except for Compliance Buyouts as set forth in this agreement) an amount of each Player’s Player Salary and Bonuses for that League Year.  The amount of each payment to be so withheld shall be calculated by multiplying the portion of each Player’s Player Salary and Bonuses to be paid during a pay period by the applicable Escrow Percentage that is then in effect during that pay period.

Sounds to me that players have escrow taken out of their pay regardless of whether their pay counts toward the Players’ Share. 

I’m not saying that’s not the case, just that it seems weird to me that the CBA would be laid out like this.

Posted by J.J. from Kansas on 09/28/10 at 04:44 PM ET

Nathan's avatar

Posted by J.J. from Kansas on 09/28/10 at 03:44 PM ET

It’s clear as mud. smile

Posted by Nathan from the scoresheet! on 09/28/10 at 04:59 PM ET

Avatar

Average club salary, actual club salary and salary cap hit are three different things aren’t they?  You seem to have equated one of the first two with the last one..

Posted by PuckStopsHere on 09/28/10 at 03:31 PM ET

Averaged Club Salary = aggregate of player cap hits (“Averaged Amounts’).
Actual Club Salary = aggregate of actual salary & bonuses paid to players
Averaged Amount = cap hit for a player - sum of all Salary & all possible Bonuses divided by SPC term.

The Averaged Club Salary is effectively the sum of the players individual cap hits - with different accounting ruled for during the off season (50.5(d)9i)(A)) and during the season (50.5(d)(i)(B)).  A teams Averaged Club Salary is what must be kept below the cap (“Upper Limit”) - with a couple of exceptions (LTIR and the performance Bonus Cushion).

Then I’m confused about 50.4 (d) (i):

  Each Club shall withhold from each player who is party to an SPC with that Club (and current players who retire or otherwise cease playing for in the NHL to the extent such Players continue to be paid under an SPC with that Club, including, without limitation, Players who were party to SPC’s that have been bought out, except for Compliance Buyouts as set forth in this agreement) an amount of each Player’s Player Salary and Bonuses for that League Year.  The amount of each payment to be so withheld shall be calculated by multiplying the portion of each Player’s Player Salary and Bonuses to be paid during a pay period by the applicable Escrow Percentage that is then in effect during that pay period.

Sounds to me that players have escrow taken out of their pay regardless of whether their pay counts toward the Players’ Share.

I’m not saying that’s not the case, just that it seems weird to me that the CBA would be laid out like this.

Posted by J.J. from Kansas on 09/28/10 at 03:44 PM ET

Yup - that’s the case.  So, in fact Redden & Huet are actually helping other players escrow.

These issues are also being discussed on the HFBoards Business of Hockey board.  Someone posted a link to this AtoZ post - that’s how I was pulled into this conversation.

http://hfboards.com/showthread.php?t=798214&page=21
http://hfboards.com/showthread.php?t=823555

Posted by kdb209 on 09/28/10 at 05:11 PM ET

Nathan's avatar

Well shit, that’s worse. These players are first forced out of the league due to bad decisions by the clubs that signed them, then they are still forced to pay into escrow for a league they’ve in effect been blacklisted from?

Ouch.

Posted by Nathan from the scoresheet! on 09/28/10 at 05:25 PM ET

George Malik's avatar

I’m confused, three, because what constitutes a “roster player?”  Is that someone on the team’s 50-man roster, on the team’s 23-man roster, or what? 

For that matter, if we’re talking about the “actual club salary” and it accounts for the 50 men on the club’s roster, does that amount count against the players’ share, AHL players included?

Posted by George Malik from South Lyon, MI on 09/28/10 at 05:35 PM ET

Avatar

I’m confused, three, because what constitutes a “roster player?” Is that someone on the team’s 50-man roster, on the team’s 23-man roster, or what?

For that matter, if we’re talking about the “actual club salary” and it accounts for the 50 men on the club’s roster, does that amount count against the players’ share, AHL players included?

Posted by George Malik from South Lyon, MI on 09/28/10 at 04:35 PM ET

Active Roster is basically all players under contract who are not on the Injured Reserve, Injured Non Roster, or Non-Roster lists or Loaned.

It is the Active Roster that is subject to the 23-man limit.

Actual Club Salary does not include all players under contract or on the reserve list - just those players on the Active Roster (plus the Injured Reserve, Injured Non Roster, or Non-Roster lists).

“Active Roster” shall be determined as follows: Commencing on the day
prior to the start of the Regular Season, and concluding with each respective Club’s last
NHL Game in a League Year, Active Roster shall include all Players on a Club’s Reserve
List who are signed to an approved and registered SPC, subject to the provisions of
Article 11, and who are not on the Injured Reserve List, Injured Non Roster, designated
Non-Roster, or Loaned
. A Player who is on a Conditioning Loan is included on a Club’s
Active Roster. During Training Camp, a Player shall be deemed to be on the Club’s
Active Roster only if he had been on the Club’s Active Roster after the Trade Deadline in
the preceding season on other than an emergency recall basis.

16.4 Active Roster Size; Playing Roster.
(a) For the 2005/06 League Year and thereafter, there shall be a maximum of
twenty-three (23) Players on each Club’s Active Roster at any one time, provided,
however, that, on the date of each season’s Trade Deadline, a Club’s Active Roster may
be increased to any number of Players the Club, in its discretion, so determines, subject to
Article 50 hereof.
(b) Except in case of emergency, there shall be no reduction of the required
minimum Playing Rosters of the Clubs, below eighteen (18) skaters and two (2)
goaltenders.

Posted by kdb209 on 09/28/10 at 05:52 PM ET

HockeyTownTodd's avatar

The Migraine Police are going to hunt all of you down if you don’t open a different can of worms, soon.

Posted by HockeyTownTodd on 09/28/10 at 05:58 PM ET

Pharazon's avatar

colour me utterly confused

Posted by Pharazon from England on 09/28/10 at 06:22 PM ET

J.J. from Kansas's avatar

I’m going to go ahead and accept this as fact, but would like the diggers working the angles here to find out if this is actually the way they’re doing it.

I don’t trust that the math isn’t getting screwed up, since it took a day and a half for the league to explain to everybody that the Kovalchuk fine wouldn’t count against the Devil’s salary cap this season, despite that the CBA says it should have.

If it (likely) does turn out to be true, it doesn’t change much as far as what changes I think need to be made to the next CBA, but I’ll need more time to process that.

Posted by J.J. from Kansas on 09/28/10 at 06:28 PM ET

George Malik's avatar

1.  kdb209 thank you for all your insight!

2. HTT: I now.  It’s confusing as hell.  There’s a sick and twisted part of me that absolutely loves it because…

3. It’s pretty clear at this point that I need to bother someone at the NHL and/or NHLPA’s front office to set the record straight from the official perspective.  This issue is remarkably complicated and we need to hear from somebody whose job it is to know where this money’s coming from.

Posted by George Malik from South Lyon, MI on 09/28/10 at 07:51 PM ET

stonehands-78's avatar

As soon as I saw Malik’s name on the byline I stopped reading, took a dump, warmed up some food, rotated the tires, put in for vacation, then came back to the computer to read.

Very nice George.

And who knew the mention of Jake Wood would grab so much attention.  Must be all the old farts….

Posted by RWBill from the Capital of the Confederacy. on 09/27/10 at 10:16 PM ET

I sooooooo agree, RWBill. The GJM byline requires a comfie reading atmosphere. Good stuff.

And this was me after your first sentance:


Posted by stonehands-78 from the beginning ... a WingsFan, on 09/28/10 at 08:19 PM ET

stonehands-78's avatar

Didn’t Gary.ass tell us via VooX not to worry about the CBA, being a couple years out and all?

Posted by stonehands-78 from the beginning ... a WingsFan, on 09/28/10 at 08:22 PM ET

George Malik's avatar

Clarification from the NHLPA….we has it.  Give it a gander.  Jonathan Weatherdon explains it all.

Posted by George Malik from South Lyon, MI on 09/30/10 at 06:13 PM ET

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Welcome to Abel to Yzerman, a Red Wing blog since 1977.  No other site on the internet has better-researched, fact-laden and better prepared discussions than A2Y.  Re-phrase: we do little research, find facts and stats highly overrated and claim little to no preparation.  There are 19 readers of A2Y. No more, no less. All of them, except maybe one, are juvenile in nature.  Reminding them of that in the comment section will only encourage them to prove that. Your suggestions and critiques are welcome: wphoulihan@gmail.com