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NHL CBA Quirk Theater Entry-Level Deals and Arbitration

For a select few players, there's a gap between when they can become an RFA and when they can use arbitration to leverage a fairer deal. This is no accident.

Bruce Bennett

As we look at the CBA, it can sometimes get lost in the details where some sections overlap to create rules that only realistically apply to a few players. Each of the CBA's sections cover the binding rules, and definitions are fairly well-standardized across the board, but there are several places, especially in dealing with contracts, where you can see the scars of CBA battles past creating a few cleverly-designed rule gaps.

In today's Getting to Know the CBA, we crossed the second rule which, when combined with a previous section covered, shows something of a plan that's aimed at a certain group of players. Specifically, I'm talking about arbitration rights versus entry-level contract rules.

Let's take a look at the overlap.

Age at first SPC Signing Entry-Level Years Years Until Arbitration Eligibility
18-20 3 4
21 3 3
22-23 2 2
24 1 1

You see that? Tricky, huh?

When younger players sign, their entry-level contracts will run out one year before they're eligible to file for or be taken to arbitration. They'll be restricted free agents, but they have slightly more restrictions than other FAs.

In both cases (Entry-level & Arbitration), a "year" doesn't count the same for 18 and 19 year olds as it does for everybody else. The only way players aged 18 & 19 have a year count is if they play 10 or more games in the NHL. Without meeting that threshold, their entry-level deal "slides" one year and they don't get any closer to arbitration eligibility.

So why does Arbitration Matter?

Great question, Mr. Invented Gimmick Question Asker. If you're unsure why arbitration matters, I suggest you ask PK Subban, who just won the Norris Trophy for the league's best all-around defenseman while pulling in a $2M salary for his efforts. This is a contract he got after a bit of a holdout in which he apparently lacked the leverage to get a contract that would land him more than a $2.875M cap hit which expires with him still being a restricted free agent (and therefore still giving the Canadiens significant pull over how much he earns next and where he earns it).

Take a look at Subban's cap hit comparables and try to tell me whether you think an arbitrator would have awarded him a deal like the one he got.

If you'll remember, one of the things the NHL asked for in their first set of CBA negotiations was an end to arbitration. It's wasn't exactly a hill to die on for them, but it's certainly something NHL teams would rather not allow players to do. Without arbitration rights, RFAs are limited to holdouts, playing in foreign leagues, or hoping that another GM will sign him to an offer sheet.

Yeah, Offer Sheets!

The problem with offer sheets in a capped system is that they're rarely practical and always risky. The right of first refusal means that any offer sheet signed for a player's fair-market value is so likely to be matched that there's not really a point in offering it to a player and hurting the relationship with the GM on whose behalf you just negotiated without his blessing.

In order to levy a successful offer sheet, you either have to offer significantly more than the player is worth or you have to bank on their GM not seeing a cap crunch coming and being forced into losing assets because of it (You'll remember the Hjalmarsson offer sheet in the summer of 2010 eventually led to the Hawks having to walk away from an arbitration award for Antti Niemi, who signed with the same club who had offer-sheeted the player in the first place).

Of course, right now we're in such an unforeseeable cap crunch and it's entirely possible that this year could see an uptick in offer sheets. That's not expected to repeat for several more years if at all. With the new CBA designed to give more handouts to financially struggling clubs, the alternate solution of simply trying to break the bank on a small-market team (which didn't work in the Shea Weber situation) isn't likely to happen again.

So Just Wait until Age 21 to Sign. Duh!

You always know a writer is doing a good job when he's this disrespectful to his own strawmen...

First off, explaining to an 18-year old to wait three years instead of accepting the chance to play in 9 NHL games at that age is already a dodgy proposition. It's also not always in that player's best interests development-wise.

Adding to that: this still leaves a player with the requirement to sign a 3-year deal worth no more than he potentially could have gotten at age 18; it leaves him knowing that he could have at least gotten to non-arbitration-eligible RFA status one year earlier (where you can at least get paid more); AND, provided that you got drafted out of the CHL, like many players, it leaves you with one year of hockey played in a nice town called fuckknowswhere, since you can't play in the CHL at all by that age, so you'll have to spend a year either as an AHL signing or in Europe.

Some players actually do this. Gustav Nyquist and Joakim Andersson both signed their EL deals at age 21 and now they're both RFAs with arbitration rights. Tomas Tatar signed his at age 19 and will next year be an RFA with no arbitration rights. Brendan Smith signed at 21 because he chose to play in college and wasn't able to sign his entry-level deal while still in the NCAA system.

To be as respectful as possible, none of those players is as good as PK Subban right now, so them having arbitration rights doesn't mean as much as him having them. Brendan Smith was drafted before PK Subban in the same year and there's a decent chance that the sheer nature of his arbitration is going to award him a comparable salary to Subban's. While they're comparable players in that they don't always make the smartest decisions, they're both defensemen, and they're both kind of polarizing figures, one of them has a Norris Trophy and the other does not.

Wrap it up, I'm Bored

Generally, the very very good players (Ovechkin, Crosby, etc) get their second contracts before they even hit the end of their entry-level deals because these are guys worth throwing enormous offer sheets at and actually have the leverage to make not having arbitration rights an unimportant consideration. Nobody really wants to see what an arbitrator would award one of the league's best players though. Bad players don't need arbitration because they don't get qualifying offers and end up as UFAs anyway. The large group of middling players with uncertain ceilings and who may be gambles to hit them?

That one year where they may not go to arbitration and aren't likely to snatch up an impressive offer sheet has the power to get no small number of them into deals they might otherwise not sign. This wasn't the first statistically impressive year for Subban, but he wasn't so established that he could attract a competitive offer, so he ended up taking a discount to prove himself because it was either that or take an entire season off to let not only his skills, but also his reputation diminish because of a refusal to play ball in a system designed to force him to do so.

It's a little devious; the other side of the coin is that it prevents teams from getting screwed when promising kids who can drive their own prices a little screwy can't deliver. It's the system the NHL has right now though.