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How The Flyers Use IR To Beat The Salary Cap

Creative accounting is a part of the NHL in its salary cap era.  The Philadelphia Flyers have a method that is unique to them to exceed the salary cap.  They do not buyout players.  Instead they permanently transfer them to the longterm injury reserve.  Any player who has had a lengthy NHL career has some kind of recurring injury problem that can be played up and turned into a longterm ailment.  This allows the team to pay out the injured player’s salary to a new replacement player.  If the player was bought out, there would be dead salary cap space that couldn’t be used.

Mike Rathje is the best example of this.  He last played 18 games in the beginning of the 2006/07 season and remained on the Flyers injury reserve until 2010 when his contract ended.  Derian Hatcher spent the entire 2008/09 season on the injured reserve until his contract ended.  Both of these players never played again and provided needed salary cap relief with their injuries.

The current Philadelphia Flyers exceed the salary cap with their longterm injury players.  They have two players in Ian Laperriere and Blair Betts who are on the injured reserve and expected to never play again.  Ian Laperriere has not played since the 2010 playoffs.  It is highly unlikely that he ever plays another game and yet the Flyers keep him on payroll.  Blair Betts has serious knee problems.  The Flyers waived him at the end of training camp because he was unfit to earn a roster spot.  Montreal claimed him on waivers and then returned him to the Flyers when his routine medical showed just how badly he is hurt.  Their careers are likely over.

These situations do not make the Philadelphia medical crew look good.  They let players remain on the roster with serious career threatening injuries.  When in makes salary cap sense, the player is permanently transferred to the injury reserve instead of bought out.  Players may spend years in the limbo of the injury reserve and delay retirements to stay there.

The Philadelphia Flyers have exceeded the salary cap in nearly every year that it has existed.  They have done so with longterm placement of players on the injury reserve.  These players are no longer making any serious attempt to return to the NHL, but the Flyers find it advantageous to keep them there instead of buy them out.  This is one method used in the NHL to exceed the salary cap.

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Comments

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Avatar

“Otherwise, it’s the Flyers using a rule for the exact purpose it was written and you’re blustering about nothing.”

I think it’s not so much each individual case as Philly using it quite a bit as of late. Is that a conclusive trend? It’s obvious people disagree.

Posted by Ralph on 10/17/11 at 02:05 AM ET

J.J. from Kansas's avatar

I think it’s not so much each individual case as Philly using it quite a bit as of late. Is that a conclusive trend? It’s obvious people disagree.

Posted by Ralph on 10/17/11 at 12:05 AM ET

If you want to say that Rathje, Hatcher, or Betts fit into a trend of this, then fine. I’d say that Hatcher is the most-fitting bit of evidence to this as he was apparently put on IR against his will and was not allowed to compete for a roster spot that he felt he could compete for. However, trying to shoehorn something like the Laperriere situation into it doesn’t fit well and, what’s further, it invokes the implication that there are at the very minimum a few ethics violations by the parties involved here.

I’m also struggling with the ability to reason that the Betts situation fits into the definition of circumvention, considering the options (or lack thereof) to the Flyers.

I feel that’s irresponsible.

Posted by J.J. from Kansas on 10/17/11 at 02:15 AM ET

PuckStopsHere's avatar

these are the conditions which MUST be met in order for this to be a circumvention of the salary cap (the word “circumvention” being important here with the widely-accepted definition that it means the Flyers did something with the intent of abusing the rules of the CBA in order to allow them to somehow gain a competitive advantage). In order for this to be circumvention,

The Flyers are doing something the rules allow to exceed the salary cap.  They have done the same something almost consistently since the salary cap came in. 

The idea that the Flyers are breaking the rules is a strawman invented in the comments.  I argue they are breaking the spirit of the rules merely by having a payroll that exceeds the salary cap annually and by always having a player to put on the injured reserve permanently whenever they need the space.

Posted by PuckStopsHere on 10/17/11 at 02:49 AM ET

PuckStopsHere's avatar

I would argue that any player who spends the final multiple seasons of contract on the injured reserve should have to count as a buyout after some point toward the salary cap calculation.  They shouldn’t actually be bought out for being too injured to play - although there are several examples of players who are hurt who contested buyouts and were bought out nonetheless.

Posted by PuckStopsHere on 10/17/11 at 02:52 AM ET

PuckStopsHere's avatar

Further, Ian Laperriere is no longer seriously trying to come back.  The Flyers do not want him back.  I think they don’t want Betts back either - though less time has passed so far.  When a player is in that situation he isnt really on LTIR, he is just warehoused.

Posted by PuckStopsHere on 10/17/11 at 03:03 AM ET

Nathan's avatar

There is no firm line between when a player can and cannot play.  The Flyers decide a player in question cannot play for them when it suits their salary cap situation.  He may be playing hurt with a longterm problem (nearly every NHL veteran is in this situation), but he was playing until the salary cap became a problem.  At that point, he is sent to the injured reserve, in some cases for years when it is clear he is never coming back.

It is salary cap circumvention.

Posted by PuckStopsHere on 10/16/11 at 02:37 PM ET

Let me just say that I think it is pretty clear that the Flyers have had injury situations where they’ve been able to find silver linings in that situation by using LTIR exemption. But I think the implication they are doing it on purpose and thus damaging players careers and hurting the “spirit” of the CBA (stupid thing to say anyways) is really unfair.

John, Sven, JJ, etc. have all made really great points that you’ve had very little legitimate response to. Your schtick on all your posts seems to be to use the facts that you want and ignore the others that the readers bring up. All the facts tell the story, not just some.

One point I haven’t seen made yet—you completely ignore the fact that the players themselves and their union have recourse if they feel they are being incorrectly placed on LTIR for the purpose of cap circumvention.

Your argument makes a huge assumption—that players that feel they can still play at the NHL level will just accept the “free” money they get from landing on IR, and consider it a better alternative to A) retiring and getting no money, or B) being assigned to the AHL and playing hockey for their money.

As has been pointed out in this thread, and as I think we all agree on both sides of this debate, hockey players want to play hockey. They almost always are playing through some sort of injury, albeit “minor” by the standards of what usually forces you out of games. And in many cases, players are even playing through things that they could well sit out for without us ever second-guessing. So why would a player that is “healthy enough” to play the game he loves accept the LTIR situation instead of A) asking the club to assign him to the AHL to play so he can keep his skills sharp and try to get the attention of other clubs for a possible trade/pickup on reentry or B) if the club refused assignment to the AHL for some reason, why wouldn’t a grievance be filed with the league saying, “Hey, I’m healthy enough to play, they are just hiding my cap number! I’ve even offered to play in the minors!”

And one last thing… you nitpick back that us commenting are setting up a strawman by framing you as having said what the Flyers do violates the rules, whereas you only said it violates the “spirit” of the rules. Here’s the thing though—if you didn’t believe this type of situation was “wrong,” I can’t see why you would’ve posted this blog in the first place. Clearly, you posted it, because you believe that despite it not being a rule violation, that it should be a rule violation.

Otherwise, you’re just regurgitating the type of basic articles we had floating around four years ago before we all understood these caveats of the CBA and needed the simple primers.

Honestly, I think the only reason you are on this site is because of the old saying about there being no such thing as bad publicity. I will admit, you at least solidify the readers… it’s always nice when us Wings fans can align with Pens fans for a common cause… wink

Posted by Nathan from the scoresheet! on 10/17/11 at 11:06 AM ET

awould's avatar

Please remove this post.

Posted by awould on 10/17/11 at 12:56 PM ET

PuckStopsHere's avatar

Here is a quote from this week’s post by Elliotte Friedman

11. Here’s the important thing to remember about Brayden Schenn and the Flyers, as it was explained to me: Because Philadelphia is in “Long-Term Injury Status” with Ian Laperriere, all cap amounts are measured as full face value, and not by the daily number. Schenn’s current cap amount is $1.69 million US. The team is $1,166,667 under the ceiling (the value of Laperriere’s contract). There will have to be another move to get him to the NHL.

12. That move could be Blair Betts. Montreal wanted him, but not with a knee injury and Gary Bettman was correct in sending him back. Betts wasn’t thrilled about the possibility of an AHL stint, and it looks like Philly will go the IR route instead. Paul Holmgren really likes Betts and it sounds like the player would be incredibly appreciative of that.

The translation here is that Philadelphia needs to open up some salary cap space to bring Brayden Schenn to the NHL.  The way it will be done is by placing Blair Betts on the IR.  This is a choice.  They could otherwise send him to the AHL.  Betts would be playing hurt, but he could play.  Betts doesn’t want an AHL stint and is much happier being placed indefinitely on the IR.

Posted by PuckStopsHere on 10/17/11 at 02:10 PM ET

Avatar

Friedman got some bad information.

Betts announced that he is exploring his medical options.  He does not want to end his career.

You are correct that the Flyers no longer want him.  It’s why he was waived in the first place, so that it would do two things;

Get the Flyers back under the 50 contract limit, so that they could keep Couturier past his 9 game “try out” and remove $700k in salary off the Flyers books.

Betts did not pass another teams physical (obviously this isn’t the Flyers creating an injury) so he was returned.  Because he was returned due to injury, the Flyers can’t re-waive him and send him to the AHL.

Betts isn’t healthy.  He can’t be waived.  He can’t play.  LTIR is the proper place for him to be until he can pass a physical.

This cost the Flyers a 6th pick as they had to include one along with Legin, in a trade to LA in order to get back under the 50 contract limit.

If the Flyers wanted Schenn on the roster right now he’d be on it, and it has nothing to do with Betts.  Matt Walker has already cleared waivers.  They can send him down today and it would clear more than enough cap space to bring Schenn up.

Posted by John on 10/17/11 at 02:31 PM ET

Avatar

Hatcher fits this pattern to a T. I think Rathje does as well, but I know less for certain about his situation. My recollection is the lockout rule changes happened, Rathje looked out of place in the faster game, got hurt in the second year, missed most of it, and was permanently placed on LTIR after a training camp in which he was not only able to play, but suffered no reinjury.

If anyone wants more evidence of the Flyers using this exception to get out of crap contracts, just wait two or three seasons. Unless the CBA changes this loophole or the way 35+ contracts or buyouts are handled, I can guarantee right now that Chris Pronger will be LTIRed—not retired.

Posted by steviesteve on 10/17/11 at 02:42 PM ET

J.J. from Kansas's avatar

Betts would be playing hurt, but he could play.

If Blair Betts were healthy enough to play (like you’ve insinuated), then he would be on Montreal’s roster right now.

The choice is not: play him, send him to the minors or put him on IR. The choice is to send him to the minors or put him on IR.  As it stands with Betts’ situation, this is not a cap circumvention until Betts is actually healthy enough to be sent to another team and remain there.

If he can’t play in Philadelphia and he can’t play in Montreal, why would there be an expectation he could play in the lower league on a recently-injured knee?

While on IR with the Flyers, Betts has access to the Flyers’ medical facilities and training staff. Sending him to the minors to not play and to be tended to by what I’m just going to assume is inferior medical care isn’t in anybody’s best interests.

Posted by J.J. from Kansas on 10/17/11 at 02:45 PM ET

PuckStopsHere's avatar

JJ

Injured players cannot be sent to the minors. 

The only way Betts faces the choice between going to the minors or the IR is if he is simultaneously injured and not injured, which is exactly what he is.  He is capable of playing hurt or he could be put on the injured list.  The Flyers use players in this grey area to manage their salary cap.  When it helps the cap situation he goes on the IR, often permanently.

Posted by PuckStopsHere on 10/17/11 at 09:03 PM ET

J.J. from Kansas's avatar

Which fits perfectly in with the narrative that he was waived by the Flyers, picked up by the Canadiens, and then returned to the Flyers when he failed a physical performed by a team other than the Flyers which would have cleared him to play.

This does not seem like a player movement based on convenience for the Flyers as much as it seems like a necessity.

They wanted rid of Betts. They tried to get rid of Betts but they couldn’t BECAUSE HE WAS TOO INJURED TO PLAY. Their only other option was to keep a man who was TOO INJURED TO PLAY on the roster, which would have been stupid.

To continue to call this a circumvention as though his move to the IR was driven by convenience rather than necessity completely crosses the border of tinfoil-haberdashery and into full-fledged ridiculous.

If we were capable of playing well enough to deserve a roster spot despite his injury, he would be a Montreal Canadien right now and the Flyers would still have the draft pick they had to move to adjust to this happening.

Wait, are the Habs in on it too?

Posted by J.J. from Kansas on 10/17/11 at 09:43 PM ET

PuckStopsHere's avatar

The story as Elliotte Friedman reports it is that Philadelphia will put Betts on IR to gain salary cap space to bring up Brayden Schenn.  Sending him to the minors (where he would play) wont change their salary cap situation.

Posted by PuckStopsHere on 10/18/11 at 12:11 AM ET

J.J. from Kansas's avatar

If he wasn’t healthy enough to play for Montreal, why is he healthy enough to play in the AHL?

At this point, as it relates to your original argument, what does it even matter? If you’re saying that Blair Betts would currently be playing for the Flyers if not for their underhanded desire to make cap room for Brayden Schenn, you are wrong.

The entire situation with Montreal proves that.

Posted by J.J. from Kansas on 10/18/11 at 12:43 AM ET

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imageThe Puck Stops Here was founded during the 2004/05 lockout as a place to rant about hockey. The original site contains over 1000 posts, some of which were also published on FoxSports.com.

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