If you’re a big NHL fan or enjoy watching the sport, chances are you’ve come across the term “contract buyout” when discussing player moves. But what does it mean in the NHL, and how does it all work?
In this detailed guide, I’ll dive into the ins and outs of NHL contract buyouts, break down the process, discuss what it means for the players and teams involved, and answer some common questions. So, let’s get started!
Understanding NHL Contracts
Before we go into the fascinating realm of NHL contract buyouts, let’s establish a solid foundation by understanding NHL contracts comprehensively.
These contracts serve as binding agreements between NHL players and their respective teams, encompassing a range of crucial elements that shape the terms of employment. These elements include salary, duration and various other benefits that contribute to the overall dynamics of the player-team relationship.
What Is an NHL Contract Buyout?
Now, let’s get to the answer you’re here for. An NHL contract buyout is when a team and a player agree to end the contract early. It can happen for different reasons, like if the player isn’t performing well, if the team has salary cap issues, or if they want to go their separate ways on good terms.
The Mechanics of an NHL Contract Buyout
The NHL Collective Bargaining Agreement (CBA) governs the rules and regulations surrounding contract buyouts. Here’s a step-by-step breakdown of how it works:
Step 1: Identifying Candidates
Teams look at their rosters and determine which players they want to buy out. Usually, the buyout window opens for a certain period after the NHL season ends.
Step 2: Calculating the Buyout Cost
The buyout cost is calculated based on the player’s age, remaining years, and salary on their contract. Here’s how it works:
- For players under 26, it’s one-third of the remaining salary.
- For players 26 and older, it’s two-thirds of the remaining salary.
If the player is under 26, the buyout cost is twice the remaining contract duration. If the player is 26 or older, the remaining contract duration is spread over.
Step 3: Cap Hit Implications
The most crucial aspect of an NHL contract buyout is how it affects the team’s salary cap. The player’s cap hit is not entirely erased but is reduced based on the buyout cost. This reduction is spread evenly over twice the remaining years of the contract if the player is under 26 and over the remaining years if they are 26 or older.
Step 4: Waivers and Waiting Periods
Once the NHL approves the buyout, the player is placed on waivers for a specified period. If they clear waivers, they become an unrestricted free agent (UFA), free to sign with any team. However, there is usually a waiting period before they can rejoin the team that bought them out.
The Cap Hit and Its Implications
Understanding the cap hit implications of a contract buyout is crucial for both teams and fans. When a player’s contract is bought out, the team incurs a reduced cap hit over a certain period. This allows the team to free up cap space to sign other players, make trades, or address different roster needs.
However, it’s important to note that the cap hit isn’t eliminated. It’s merely reduced, which varies depending on the player’s age when the buyout occurs. The cap hit remains on the team’s books for the duration specified in the CBA.
Frequently Asked Questions (FAQs)
Can an NHL contract be voided?
NHL contracts cannot be voided unilaterally. They are legally binding agreements between a player and a team. However, contracts can be terminated through mutual consent, which is what happens in a contract buyout.
Can NHL teams buyout KHL contracts?
NHL teams cannot buy out contracts of players currently signed with the Kontinental Hockey League (KHL) or any other foreign league. The NHL’s jurisdiction only extends to contracts signed within the league.
Can you buy out an injured NHL player?
Yes, NHL teams can buy out injured players. In fact, injured players can often be more appealing candidates for buyouts because they are exempt from the buyout-waiver process. However, the player must be deemed “fit to play” by medical professionals for the buyout to proceed.
Do NHL players get paid for buyouts?
Yes, NHL players receive a portion of the money owed to them under their original contract when they are bought out. The buyout cost is paid to the player, but it may be subject to certain deductions, including escrow.
What NHL player was bought out twice?
Vincent Lecavalier is a notable example of an NHL player being bought out twice. He was initially bought out by the Tampa Bay Lightning in 2013 and later bought out by the Philadelphia Flyers.
NHL contract buyouts are a complex but super important mechanism for teams to manage their rosters and salary cap. Understanding the whole process, implications, and rules surrounding contract buyouts is crucial for fans and analysts, too.
While the specifics may vary from case to case, the principles behind NHL contract buyouts remain consistent: they allow teams to adjust their rosters and allocate resources more effectively.
So, the next time you hear about an NHL contract buyout, you’ll have a deeper understanding of what’s happening behind the scenes in professional hockey.
Whether it’s a struggling player looking for a fresh start or a team trying to be more flexible financially, NHL contract buyouts significantly shape the league’s landscape.