Oscillating Salary Caps and Rigid Player Contracts June 29, 2009

A recent discussion topic has emerged with the economic downturn at hand. The talk centers on how drastically the salary cap will fall for the next season. And what effect that will have on general managers’ hands. It was recently announced that for the 2009-2010 season the cap will actually go up about $100,000 to $56.8 million max and a floor that is always $16 million less ($40.8 million). This was due to the players invoking their 5% escalator clause in the current CBA. The cap was going to drop a few million dollars, but the escalator negated that effect. This upcoming season is not the concern. It is the one that follows since the cap uses revenues from the preceeding season. The downturn really hadn’t affect the NHL as most of the cash was already collected before times changed.Fans and media alike would be Offside when they don’t agree that the owners beat themselves in the last CBA specifically in how the CBA treats the players and owners when the cap drops. It will become obvious to all by the end of this article as to why the players will always invoke the escalator regardless of the conditions of the NHL’s 30 businesses.When the revenues increases significantly, the owners then have to cut cheques to the players, beyond their regular paychecks to ensure that the players as a whole always reach 54% to 56% of total NHL revenues. Although there are very complicated formulas to decide how much each player would receive as “revenue bonus” money, this is essential cut and dried. This was the easy part. more »