There was no hockey being played in the NHL during what would have been the 2004-05 season due to a lockout. That was the first time in North American sports history that a major professional sport had lost an entire season due to a labor dispute. Since then, the NHL and NHLPA have come to a collective bargaining agreement or CBA. The major component the NHL wanted was to instigate a salary cap. Prior to the lockout, the NHL was the only major sports league in North America that didn’t use a salary cap.

The NHL salary cap is intended to prevent teams in larger markets that generate more revenue, from attracting more top players with promises to pay them more than the smaller market teams can afford, thus having an unfair advantage.

The CBA was introduced as a way to prevent teams from being forced to relocate, sell, declare bankruptcy, or lose money. The purpose is to have every NHL franchise profiting from the service they provide to their respective NHL team’s markets. The NHLPA is more concerned with the care of the players in regards to the compensation they receive. The NHL is more concerned with the shape of the league and its 30 franchises and their markets. The CBA has many rules and restrictions, so many that it leaves the average person confused and uneducated.

Under the CBA, there is a term called the ‘cap hit’. This refers to the total salary the player will earn throughout the duration of his contract, divided by the number of years he is under contract. This is to prevent teams from paying a player more or less money in different years so they can load up his cap hit on years where they have the most cap room.

Cap room is the amount of money between the salary cap, and players total salaries. There is also a term known as the Mogilny rule. This term states that any player that signs a multi-year deal when he is 35 years or older, starting in the 2nd year of his contract, the amount of salary he earns will count against the team’s cap despite whether or not the player is on the active roster or not.

This is designed to prevent teams from signing players to front-loaded contracts that over-pay players significantly while both the NHL team and the player understand that there is a good chance he will not even play the duration of his contract before he retires.

There are penalties for violating these rules, both on the NHL team, and the player. The consequences depend on who was found at fault for the violation of the CBA. The consequences stem from individual player fines, to a forfeit of games and a loss of draft picks for the franchise.

The New Jersey Devils, who signed highly sought after free agent Ilya Kovalchuk, were recently punished by the NHL for salary cap circumvention, thus violating the CBA with the lucrative front-loaded contract that Kovalchuk and the franchise agreed upon. It was structured so that Kovalchuk would earn $102 million over 17 years, ending when he was 44 years old, at which point most players would have retired.

They ended up losing a first round draft choice, of which the Devils can choose to forfeit over the next 4 years. Kovalchuk and the Devils were also forced to restructure the contract to be compliant with the CBA. They ended up settling on a 15 year deal worth $100 million.

The initial contract that was rejected by the NHL caused questions to arise of whether or not other contracts that were already signed by different players and teams throughout the league, had violated the CBA as well. Numerous star players, of which had already had their contracts approved by the NHL, had already played a season or more under that current contract. The NHL decided to investigate this matter with threats of possible discarding and termination of the contracts.

Player’s lawyers and agents responded in a uproar, threatening to file lawsuits against the NHL if these contracts were voided. The investigation process is reported to still be underway, but is likely not going to take any actions, and is being used precisely as a scare tactic to put an end to contracts like Kovalchuk’s being offered.

The 2010-11 NHL season has a salary cap of $59.4 million, up $2.6 million from the 09-10 season. The minimum salary teams can pay their players is $43.4 million. Under the CBA that the NHL and NHLPA currently have, teams are allowed 1 player earning 20% of the team’s total salary cap per year, which is $11.88 million. This salary cap, and rightfully so, is being flirted with by many NHL teams worse than the prom queen at a high school graduation.

The New Jersey Devils are in the roughest of shape of NHL teams. During an NHL game, due to suspensions and injuries, they were unable to call up players from their AHL affiliate to ice a complete roster of 18 skaters. Instead of making a transaction to relieve their cap situation, they decided to play a game with only 15 skaters, essentially eliminating 1 of 4 forward lines. They ended up losing the game and from a spectators point of view, were lacking depth and energy that could have been resolved by having that extra line of forwards.

Fans and media all over the world that follow NHL hockey have their opinions of who they agree with, the NHL or the NHLPA.

Who are you behind?

Jordon Judge
 
HockeyGods