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NHL Buyout Rules: CBA Refresher

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Bruce Bennett

Now that the Stanley Cup has been awarded, we can finally look forward to the true beginning of the offseason. You know what that means: Rosterbation!

Since player movement can actually begin soon now that all GMs don't have games to focus on and also since this is the last year of the two-year window of the current CBA in which teams can exercise a compliance buyout, here's a quick refresher on how buyouts work:

  • The club must first offer the player up on unconditional waivers (any other club has 24 hours to take over the entirety of the contract and cap hit.). A player with a no-movement clause may block these waivers and choose to accept the buyout immediately, but he may not block the buyout itself.
  • The official notice of termination becomes effective either the instant the player opts not to go on waivers or the instant he clears them.
  • The buyout window will open on Monday and will remain open until June 30th. There's a second window after arbitration settlements are made, but expect the majority of buyouts to be done before free agency opens on July 1st.
  • Buy-out payments extend out twice as long as the original contract would have, but only pay the player a percentage of the amount still owed to him, based on age. For those under 26, the buy-out pays 1/3rd. If the Player is over 26, he gets 2/3rds of that salary.
  • If a player is claimed on unconditional waivers, the buyout doesn't happen. The team who claims the player takes over his full contract.
  • Once bought out, the player becomes an unrestricted free agent. He may sign with any team he wishes except for the team that just bought him out (and, if rumors from last year in regards to Vinny Lecavalier are true, a team may not re-sign a player they traded to another team in order to have the other team buy him out. This is not expressly laid out in the CBA, but it's easy to see how the NHL would consider this practice a breach of the spirit of the rule).

Compliance buyouts work the exact same way as ordinary course buyouts do. The only difference is that while a player is being given either 1/3 or 2/3rds of the salary spread over twice as may years, that money will not count against the team's salary cap commitments. As a reminder, you may not use a compliance buyout on a player signed after September 15, 2012. Any such buyout would be considered ordinary-course and there would be a cap charge.

With this being the last year to do compliance buyouts and with there being a lot of overpaid players in the NHL, expect a fair number of buyouts over the remainder of the month.