2012-13 NHL RFA Compensation Limits

The 2012-13 NHL RFA compensation limits have been released, per the Globe and Mail.

How RFA Compensation works: If a team has an RFA who has received a qualifying offer and has not signed before July 1st, that RFA may sign an offer sheet with any NHL club who has the ability to pay the compensation for an unmatched offer sheet. Teams get seven days to exercise their right of first refusal on an the contract signed by the player whose rights they own. If the club elects not to match the compensation given to the player by the offer sheet within that time frame, they are given compensatory draft picks from the gaining team based on his salary range. These picks must be the team's own picks. This means a team that does not still have a pick that would be used for compensation (through trade or punitive forfeit) cannot sign a player to an offer sheet in the range which would cost them that pick.

Here are the numbers:

$1,110,249 or below - No Compensation

Over $1,110,249 to $1,682,194 - 3rd round pick

Over $1,682,194 to $3,364,391 - 2nd round pick

Over $3,364,391 to $5,046,585 - 1st round pick, 3rd

Over $5,046,585 to $6,728,781 - 1st round pick, 2nd, 3rd

Over $6,728,781 To $8,410,976 - Two 1st Round Picks, 2nd, 3rd

Over $8,410,976 - Four 1st Round Picks

As a reminder, under current rules there is a bit of a sticking point that defeats a long-term contract offer to lower a player's AAV and therefore lower compensation. Pension Plan Puppets brought it up in a blog about delivering an offer sheet to Vancouver Canucks' goalie Cory Schneider:

10.4 Draft Choice Compensation for Restricted Free Agents

Any Club that is entitled to but does not exercise its Right of First Refusal pursuant to Section 10.3 shall be entitled to obtain Draft Choice Compensation from the New Club. The number and quality of draft choices due to the Prior Club shall be based on the average annual value of the compensation contained in the Principal Terms (as defined in Section 10.3(e) hereof) of the New Club's Offer Sheet (determined by dividing such compensation by the lesser of the number of years of the Offer Sheet or five)

This means, you could not give Shea Weber an offer sheet of 10 years, $84M to escape the Four 1st round picks tier, since the compensation rule states that the entire compensation amount cannot be divided by more than 5 when considering which tier in which an offer sheet lies.

While offer sheets are not currently common, the compensation limits on the lower tiers can make for some interesting considerations when it comes time for a team to re-sign a 3rd/4th line center/winger, don't you think?

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