The Ilya Kovalchuk Rule: How Player Retirement Should Affect the Cap

July 22nd, 2010 by Matthew Rutledge-Taylor Leave a reply »
There was an uproar this week due to the massive contract signed by Ilya Kovalchuk with the New Jersey Devils.  Not only is it the longest contract in NHL history, but it immediately raised eyebrows due to the obvious attempt to cheat the salary cap.  Kovalchuk would be paid market value of $9.5 million a year for the first 10 years of the deal, but the team would only take a salary cap hit of $6 million a year during that time.

How does that work, and what's a fair way to deal with this situation?

The solution to the fiasco surrounding the league rejecting the Kovalchuk deal is simple.  The league just has to follow their own example of how buyouts work.  When a player is bought out, the team’s cap hit for the buyout period is calculated to ensure that the total money paid by the team to the player is exactly equal to the total cap hit incurred by the team.  See NHL Offseason: What's the Cap Hit For A Buyout? for an explanation of how this works.

Similar to a buyout, if a player retires before his contract has expired, the team should have to suffer ...

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