For what is a simple enough concept, the NHL’s salary cap can actually be a very complicated issue for teams to navigate. For basic knowledge (and if you are the type of person whose eyes roll back in their head when you start hearing numbers this is for you) all you need to know is that the Penguins, like all other teams have to stay under the upper limit of the salary cap. It was set at $75,000,000 this year.
For more detail-oriented folks, you probably already know that the salary cap is actually calculated every day on a day-by-day basis with all players on the NHL roster that day counting against the cap as the season goes on, thus why it can be so important on when to send young players to and from the AHL in order to manage the financials.
Now that the season is over, the whiz kids at CapFriendly have been able to determine which players got bonuses. Contract bonuses are actually fairly rare in the NHL, a player must be on his first contract (entry level) or be a 35+ veteran contract to be able and sign a contract with performance-based metrics for bonuses. Zach Aston-Reese had them but the player who probably hit some was Jake Guentzel.
To make matters complicated, teams can and often do use a provision in the rules that allows bonus money earned one year to count against the following season’s salary cap.
9 teams incurred a Bonus Overage for the 2018-19 season, ranging from $25K to $2.55M.— CapFriendly (@CapFriendly) May 20, 2018
Details are as follows:#Leafs: $2,550,000#Blackhawks: $1,232,500#Canucks: $852,847#Bruins: $774,000#RedWings: $755,000#Blues: $150,988#Lightning: $142,947#Caps: $82,500#Wild: $25,000 pic.twitter.com/s1MSaLxAoe
If you are a high budget team with a few really good young players (like Auston Matthews, Mitch Marner and William Nylander in Toronto), you’re probably going to have to dip into next season a bit, as they did above. In a sense, it’s a handicap for next season but often times these types of teams are used to this expense and carry it over year-to-year.
One great thing is that the Penguins had enough money left over in their 2017-18 to fit Guentzel’s bonuses. And just barely!
Despite a couple of their players having earned performance bonuses this past season, and despite having gone in & out of LTIR on two separate occasions in 2017-18, the Pittsburgh #Penguins still managed to avoid a bonus overage and actually slid in under the ceiling by $950!— CapFriendly (@CapFriendly) May 20, 2018
This is great work done by general manager Jim Rutherford and his management team of assistant GMs in Jason Karmanos and Bill Guerin and their staff. All the scoffs and weird narratives that former assistant Jason Botterill apparently being the only person in the Pittsburgh front office capable of managing a salary cap and that there would be any sort of massive negative impact from his departure to his can be put to rest. The Pens did a masterful job this season with their salary cap.
As CapFriendly mentioned, it’s certainly not a simple task with the long-term injury reserve also in play (team’s only enter those waters when they are exceeding the upper-limit by having a player injured). It doesn’t mean “cool you can exceed the salary cap” it means, in simple terms, you can spend up to the injured player’s salary on a replacement for him while he is injured, but only while he is injured. But to have to use LTIR for two stretches during the season and still end up having juuust enough cap space to afford performance bonuses is a very impressive feat of management. Generally speaking usually if a team needs LTIR, they have almost no cap space and they end up on the list of team’s in the first tweet that are dealing with a bonus overage penalty for the following season.
The coup de gras certainly came the weekend before the trade deadline where the Pens picked up the center depth they were searching for by adding Derick Brassard at 60% of his salary. Rutherford and company were very creative to use a 3rd party (Vegas) to give up some of their cap money to make Pittsburgh better, the first time such a transaction has happened in the NHL. And, the best part is that salary retentions in the NHL have to be for the life of the contract. So, just as the Maple Leafs are on the hook for 15% ($1.2 million annually) of Phil Kessel’s cap hit for years to come, the Golden Knights will have a $2 million cap hit next season for Brassard, a player that never played for them.
This allows Pittsburgh to have a $5m center for $3m and probably will give them enough savings to re-sign restricted free agent Riley Sheahan, who will be due a $2.075 million qualifying offer this summer. Without the Brassard retention, something else would have to give somewhere and the Pens would have had to let Sheahan go for a cheaper replacement or skimp further on their defense.
With the Penguins having so many high-priced players locked up for years to come (the Crosby’s, Malkin’s, Kessel’s, Letang’s and Hornqvist’s of the roster) they will always be right up against the salary cap. Luckily this season we saw Rutherford operate in an innovative way to upgrade the Pens, pay his performance bonuses and still not incur an over-age for 2018-19. If you’re a Pens fan you have to be very confident and impressed with how the financials of the team are being managed.