NHL contracts & the salary cap
So I got a question about how NHL contracts & the salary cap work in the comments on one of my posts, and I thought it might be good to do a separate post about it in case anyone else here was interested.
Here's a quick(ish) explanation. (ETA: I lied, this is not quick at all lol.)
(More after the cut)
Salary cap- In the NHL, there's a minimum amount that each team has to spend on their players & a maximum amount they can spend. This system has been around for over 20 years now. It's a way to have parity within the league, so that you don't have a situation with the richer teams in big markets like NY or LA being the only ones who can attract the best players (because they're the only ones who can afford them). This evens things up, so that smaller markets are on the same playing field as bigger ones. Basically, it keeps things fair for everyone & puts the responsibility largely on the general managers to make good choices.
Cap amounts- The cap is based on how much revenue the NHL brings in annually. It's currently on the rise and expected to have a pretty massive growth within the next 5 years. Here's the current amounts & projections:
25/26 season- $70.4- $95.5 million
26/27 season- $76.9- $104 million
27/28 season- $83.9- $113.5 million
So next season, teams will need to spend a minimum of $76.9 million & a maximum of $104 million. (And you can see how much that's expected to jump the following season!) The best players on a team can expect to make about 15% of the max. Last season, that would've been $14.3 million per year. By 27/28, that number will be just over $17 million per year. It's a big difference, and something to keep in mind when discussing fair contract amounts & bridge deals.
Contract Extension- In the final year of their contract, most players are eligible to sign an extension. They still make the same amount from their original contract in that final year, but they can agree to add up to 8 years with their current team at a renegotiated salary (next season this will change to 7 years max). Mack & Will are both eligible for contract extensions this year. The earliest they can sign is July 1st.
ELC- (Entry-level contract) When a player is drafted, the NHL team that drafts them earns the exclusive rights to sign them to a contract. If that player chooses to sign, the ELC is their first contract. It ranges from 1-3 years depending on age, but most commonly it's the 3-year contract for 18-21 year olds. The salary for players on an ELC currently ranges from $775-$975k per year, with some additional performance-based bonuses added in. (Mack's base salary is $975k, Will's is $950k.) Undrafted players who are under 25 also have to sign an ELC (like Colin Graf). Since the Sharks currently have so many players on their roster under 25, and since they traded away a lot of their highest-paid players when they started their rebuild, they currently have a LOT of cap space.
RFA- (restricted free agent) Once a contract is up, if that player is under 27 years old or has played less than 7 seasons in the NHL, that player becomes a restricted free agent. At this point, another team can offer them a contract BUT their current team is allowed to match that contract. If they choose not to, that player will get traded & their original team will also receive draft picks for future drafts. (Trading is a bit complicated so I won't get into it here.)
UFA- (Unrestricted free agent) Once a player turns 27 or has played 7 seasons in the NHL (minimum 40 games to qualify as a season), they become a UFA after their contract expires. At that point, they can go to any team they want without additional compensation having to be made to the original team that signed them.
A recent reason for a bridge deal is the salary cap going up. Remember that number I mentioned above? Players don't want to lock in with a lower contract right now when there will be much more on the table within the next couple years. What may look like a great deal now might not look so good in 7 or 8 years. This is one of the reasons it would be totally reasonable for Mack or Will to ask for a bridge deal, or to opt to sign for maybe 5 years instead of doing a full 8. Five years still shows commitment to the team without potentially screwing yourself financially. The Sharks would get Mack until he was 25 & became a UFA, and at that point he'd likely lock into a massive longterm deal. (Assuming things are going well for both him & San Jose at that point!)
Bridge deal- This is a short-term contract between 1-4 years that starts after the ELC ends but before that player becomes a UFA. There are a few reasons for a bridge deal, but the simplest reason is either the player or the team or both is saying "let's try this out for now & see what happens". So the player isn't locked into a longterm contract with a team they're maybe not 100% sure about, or the team isn't locked in on a player they're not 100% sure about. (There's a rumor Connor Bedard may go this route.)
Yet another reason for a bridge deal is a younger player who knows they haven't performed as well as they can, and wants a chance to have an amazing season so they can get a much better, longterm deal in the future.
Hope this was helpful @pisces00! And hope other people found it informative too ❤️
