CBA Explained: Contracts outside the league AKA the Wade Redden Rule

For this week’s installment of CBA Explained, I tackle “Contracts outside the league” or what many are calling the “Wade Redden Rule”. It’s been a relatively hot topic since it was first proposed, and now that it is in effect, the Flyers are already feeling its effects.

From the summary of terms, item #10:

“Money paid to Players on NHL SPCs (one-ways and two-ways) in another professional league will not be counted against the Players’ Share, but will be counted against the NHL Club’s Averaged Club Salary for the period during which such Player is loaned to another professional league as follows:
a) In the case of a one-way SPC, the AA of such SPC less the then applicable NHL Minimum Salary plus $375,000 (e.g., currently $900,000) will be counted against the Club’s Averaged Club Salary, or
b) In the case of a two-way SPC, the total compensation (defined for these purposes as the greater of: i) that League’s Year’s stated Paragraph 1 Minor League Salary and Bonuses (other than Exhibit 5 Bonuses unless earned) and ii) guaranteed salary and Bonuses) in excess of the then applicable NHL Minimum Salary plus $375,000 (e.g., currently $900,000) will be counted against the Club’s Averaged Club Salary.”

 

What the above excerpt is stating (specifically the bolded) is that any player playing outside of the NHL but making more than the NHL Minimum + $375k, so $900k in this case, will count towards the teams’ salary cap.

Prior to the start of this season Brian Boucher was re-acquired to provide some goaltending depth. He was quickly waived and assigned to the Phantoms. His $950k cap hit gets the Flyers for $50k at the NHL level ($950k salary minus the $900k threshold).

In years past, Matt Walker and Michael Leighton would have counted against the Flyers cap while in the AHL as well.

While it may seem a little silly to the casual fan, it’s actually a fantastic thing for the players. The name “the Wade Redden” rule stems from former New York Ranger Wade Redden who signed a massive contract only to be forever buried in the AHL because he wasn’t worth his contract. Despite being an NHL player (as evidence by his recent compliance buyout and then signing with the St. Louis Blues), Redden was doomed to rot in the AHL because the Rangers did not want to be held accountable for his cap hit. With this rule in place, Redden would never have been buried in the first place. Not to mention General Managers may be a little more cautious in who they give big contracts to.

  • http://www.facebook.com/parker.smith.71 Parker Smith

    Do you think this rule will increase the trade market at the deadline and in the off-season every year?

    • http://www.flyersfaithful.com/ Kevin Christmann

      That’s tough to say. If it does I don’t see it being too drastically different. At most, I’d expect teams to possibly be a little more keen to move guys over that $900k threshold if they suspect they have no place on their team. They may even have to pay teams to take them (see Gauthier to LA or Upshall to Phoenix).