Penguins

Primer: Understanding NHL contract types

[get_snippet]

To continue reading, log into your account:

[theme-my-login show_title=0]
Jim Rutherford. -- MATT SUNDAY / DKPS

The behind-the-scenes parts of hockey can be complicated sometimes.

There are a lot of misconceptions and confusion surrounding the several types of contracts and what they mean and more.

I created this primer to try to clear up some common misconceptions and answer some of the questions we often get on the subject, because we know these things can be confusing. No judgement here.

WHAT IS A ONE-WAY CONTRACT?

Whether a contract is one-way or two-way determines what that player will be paid if they are reassigned to the AHL.

If a player is on a one-way contract and makes $650,000 in the NHL, they will make $650,000 in the AHL.

Whether or not a one-way player in the AHL has any impact on the salary cap depends on their salary.

The NHL minimum salary is $650,000 in 2018-19. For one-way players who are paid $1.025 million or less (the NHL minimum salary plus $375,000), they can be re-assigned to the AHL and have none of their salary count towards the cap. Anything over $1.025 million would count towards the cap -- if a player on a one-way deal with a cap hit of $2.025 million gets reassigned to the AHL, $1 million would still count towards the salary cap.

Example: Dominik Simon was signed to a two-year, one-way contract in 2018 with a cap hit of $750,000. If the Penguins sent him to Wilkes-Barre/Scranton and he cleared waivers, he would still make $750,000 in Wilkes-Barre, and his contract would not count towards the cap because it is less than $1.025 million.

WHAT IS A TWO-WAY CONTRACT?

If a player is on a two-way deal and makes $650,000 at the NHL-level, they will make a smaller amount in the AHL. Minor-league salaries for two-way players are not pre-determined by a formula, they are set by the team in the player's contract.

Should a player on a two-way deal end up in the ECHL, they would be paid the same as if they were in the AHL.

All entry-level contracts are two-way contracts. For players on entry-level contracts, the maximum minor-league salary is $70,000. If a player on a two-way contract is sent to the minor-leagues, their salary does not count towards the salary cap.

Example: Ryan Haggerty's two-way contract carries a base salary of $650,000 in 2018-19, and $700,000 in 2019-20. However, his minor-league salary is only $100,000 each year.

Salaries for two-way players are pro-rated. If someone like Haggerty spends half the season in the NHL and half the season in the AHL, the actual money they earn would be somewhere in the $350,000 range.

One-way vs. two-way status does not have any bearing on whether or not a player needs waivers. This is a common misconception. For more on how the NHL's waiver system works, click here.

WHAT IS AN ENTRY-LEVEL CONTRACT?

Players under 25 years of age must sign a two-way entry-level contract for their first NHL contracts.

These contracts follow the NHL minimum salary guidelines, but they also have a maximum salary of $925,000.

For players between age 18-21, entry-level contracts must be for three years. Players aged 22-23 must sign two-year contracts. Players aged 24 must sign one-year contracts.

For top unsigned players coming out of college, it essentially means that salary is a non-factor, as teams will offer the maximum $925,000 to be considered.

Example: Zach Aston-Reese was undrafted, and was one of the top college free agents in 2017. The Penguins offered a two-year deal worth $925,000, the maximum allowed. Aston-Reese chose the Penguins not because of the contract offer, but because it was the organization he wanted to play for. Juuso Riikola is making $925,000 on a one-year deal, because he signed an entry-level deal when he was 24.

For players on entry-level deals aged 19 or under, they are allowed to play a set number of NHL games without their entry-level deal taking effect. Players can play in 9 or fewer games without their contract kicking in. If a contract is for the 2017-18, 2018-19, and 2019-20 seasons, and the player does not play in 10+ NHL games during the first season, the contract is now for 2018-19, 2019-20, and 2020-2021. This adjustment can happen up to two times, unless the player is 19 years old on September 15 of the first year of their contract, and turns 20 between September 16 and December 31.

Example: In the fall of 2015, there was a debate whether or not 18-year-old Daniel Sprong should crack the Penguins' NHL roster, or be sent back to the QMJHL. Once he played his 10th game in the NHL, his entry-level contract kicked in. After 18 NHL games, the Sprong experiment ended, and he was sent back to his junior team. Even though he spent the bulk of the 2015-16 season in juniors, and the entire 2016-17 season in juniors, he was burning through the first year of his entry-level contract because he played more than 9 NHL games in 2015.

WHAT IS A TRYOUT CONTRACT?

In the NHL, professional tryout contracts are something you see during training camp and the preseason, and they're exactly what they sound like. A tryout.

If the player performs well, they can earn a full contract with the team. Otherwise, the team has no obligation to keep the player, and can release them at any time. A player can not play regular season games under a tryout contract.

Example: Sergei Gonchar was on a tryout contract with the Penguins for the 2015 training camp. He played in a few preseason games before being released from the contract and ultimately retiring.

In the AHL, tryout contracts are very different. In the AHL, professional tryout contracts allow a player to play up to 25 games. Teams often sign players from their own ECHL team or other ECHL teams to tryout contracts during the season to replace players lost to injury or recall. If the team no longer needs a player, the tryout contract can end and the player goes back to where they previously played. If a player plays out the full 25-game tryout and the team wants to keep them around, they can be signed to a full AHL contract at any time.

Example: Wilkes-Barre signed goaltender Anthony Peters to a tryout contract in 2017-18. Peters wasn't playing with the Wheeling Nailers, he was playing with the Cincinnati Cyclones. After Peters played 25 games, he earned a full contract.

Another type of tryout in the AHL is an amateur tryout contract. These are shorter contracts, and are most commonly seen towards the end of the season when prospects from college, juniors, or Europe join the AHL team as Black Aces.

Example: Wilkes-Barre signed defenseman Niclas Almari to an amateur tryout contract in March 2018. Almari was able to train with the team, and appeared in two regular season games and one playoff game. When the season ended, Almari's tryout ended and he was able to return to his Finnish team for 2018-19.

WHAT IS AN AHL-LEVEL CONTRACT?

Some players are signed to AHL-only contracts. These players are property of their AHL team, and are not technically affiliated with the NHL team. They cannot be recalled to the NHL unless they sign a new NHL contract.

All AHL-only contracts are for one year, unless specified otherwise, and the financial details are not typically disclosed. There is no salary limit for these players.

Because these players are not signed by the NHL team, they do not count towards the allotted 50 contracts an NHL team is allowed to have.

These players are still allowed to attend NHL training camps on a tryout basis. They are also eligible to be reassigned to the ECHL.

Example: Tom Kostopoulos was on an AHL-only contract in the final years of his career. He could not be recalled to Pittsburgh, although he did attend Pittsburgh training camps.

WHO CAN PLAY IN THE AHL?

Why don't more NHL players go down to the AHL after their NHL season ends? Why don't NHL teams stack their AHL teams with experienced players? The AHL is considered a developmental league, and have rules for how many players deemed "veterans" can play at once:

Of the 18 skaters (not counting two goaltenders) that teams may dress for a game, at least 13 must be qualified as "development players." Of those 13, 12 must have played in 260 or fewer professional games (including AHL, NHL and European elite leagues), and one must have played in 320 or fewer professional games. All calculations for development status are based on regular-season totals as of the start of the season.

Example: Wilkes-Barre in 2018-19 has Joey Cramarossa, Kevin Czuczman, Will O'Neill, Chris Summers, Zach Trotman, and Jimmy Hayes on the roster — all have played over 260 games in the AHL or NHL. All are allowed to be on the active roster, but only five can dress in the same game. One must be scratched each night. If Wilkes-Barre happened to have a goaltender with veteran status, they would not count towards that total. If a player surpasses 260 professional games during the season, they do not yet count towards the total. Games in low-level professional leagues like the ECHL or SPHL do not count towards the 260.

Additionally, players who are 18 or 19 and played CHL junior hockey are not eligible to play in the AHL. These players can play in the NHL, but cannot be reassigned to the minor-leagues. Therefore, teams must decide between keeping a player of that age in the NHL or sending them back to juniors. If a player is sent back to juniors, they are not eligible to join the NHL team that season until their junior season ends.

Example: Jordy Bellerive is 19 years old, so he is not eligible to play in Wilkes-Barre, despite having the talent to play at that level. The Penguins did not have a spot for him on their NHL roster, so the only place he can play is in the WHL. When his WHL season ends, he is able to play in the NHL, or more likely, the AHL.

18-year-old and 19-year-old players who are coming from European hockey or players who leave college hockey early are allowed to play in the AHL. The under-20 rule only applies to junior players. However, European or college players joining the AHL that early isn't that common. Teams prefer to allow those players to continue to develop before joining the AHL -- especially Europeans, who can gain experience in their countries' top men's leagues before coming to North America.

For more hockey-related primers like this one, click here.

To continue reading, log into your account: