Retained Salary
When teams trade a player, they can retain, or keep, some of the players' salary and cap hit. The team keeps a % of both the cap hit and salary for the remainder of the contract.
Therefore, if a Player with a Salary of $2.0M and a Cap Hit/AAV of $3.0M is traded with 20% retention, t
he trading team would continue to pay 20% of the $2.0M Salary and would continue to have a cap hit of 20% of the $3.0M Cap Hit.
The maximum retention % is 50%.
Teams can only carry a maximum of 3 Retained Salaries at a time.
An individual contract can only have a maximum of 2 teams retaining salary on it.
The maximum amount of retained salary by a team is 15% of the Salary Cap for the current year.
If a team retains salary on a traded player and that player is later sent to the minors, there is no change to the cap hit for the retaining team.
If a team retains salary on a trade, they cannot reacquire that player for one year from the date of the transaction, unless the contract ends prior to one year.
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The Business of Hockey
How Do Retained Salary Trades Work?
BY MIKE COLLIGAN MARCH 1ST, 2015
Leafs GM Dave Nonis retained half of Daniel Winnik’s salary in this week’s trade with Pittsburgh (Jerry Lai-USA TODAY Sports)
[This is part of the NHL CBA101 Frequently Asked Questions series on ColliganHockey.com. If you have a salary cap or CBA question, please submit it here.]
The 2013 CBA gave teams the flexibility to retain a percentage of salary and cap hits in trades. Calgary Flames President Brian Burke championed this idea for years at GM meetings before it was finally adopted.
There are a few key limitations:
- ‘Salary’ refers to remaining base player salary and bonuses, including signing bonuses.
- The percentage retained cannot be more than 50 percent of the salary and cap hit.
- The same percentage must be retained for both salary and cap hit. This cannot be altered from year to year.
- Teams are limited to three retained salary contracts each season.
- Teams cannot retain more than an aggregate amount of 15 percent of the salary cap upper limit. In 2014-15 that number is $10.35 million.
- A player’s contract can only be traded twice in a retained salary transaction.
There are a few specific scenarios highlighted by the CBA to keep in mind.
If a team trades away a player and retains salary in the transaction, that team cannot reacquire the player for one calendar year after the date of the transaction. One exception to this would be if the player’s contract expires or is otherwise terminated prior to the one calendar year date. In this case, the original team would be free to reacquire the player as the retained salary element no longer exists.
The CBA also prohibits a team from trading away a player and then reacquiring that player in a retained salary transaction within one year of the original trade.
If a contract involved in a retained salary transaction is bought out or terminated, all teams involved will be responsible for their respective percentage of obligations.
If a player acquired in a retained salary transaction is sent to the minors, the original team (the one that retained salary) must still include their portion of the contract on their salary cap for the remainder of the contract, regardless of whether the player is ever recalled or not. This prevents a team from cutting a player’s contract in half and then having the new team make the cap hit disappear by sending him to the minors.
Finally, a second retained salary transaction does not modify in any way the original terms and obligations of an initial retained salary transaction.
(Steve Mitchell-US PRESSWIRE)
Real Example: Devan Dubnyk’s cross-continent travels in 2014 demonstrated a number of these provisions:
- Jan 15, 2014: Dubnyk was traded from Edmonton to Nashville.
- Edmonton retained 50% of his salary, or $1.75M of the $3.5M total.
- March 5, 2014: Dubnyk was traded from Nashville to Montreal.
- Nashville retained 25% of his salary (which applies to the original total). Therefore, the Predators retained $0.875M.
- March 5, 2014: Dubnyk was immediately demoted to Montreal’s AHL affiliate in Hamilton.
- After the demotion, he didn’t count against Montreal’s cap but he did still count against Edmonton’s ($1.75M) and Nashville’s ($0.875M).
CBA Reference: 50.5 (e-iii) Pages 271-274
And the final nail in your argument . Here what cap hit Nashville had on Dubnyk
PLAYER (11) | POS. | AGE | BASE SALARY | SIGNING BONUS | PERF. BONUS | TOTAL SALARY | TOTAL
CAP HIT | ADJ.
CAP HIT | CAP % | |
---|
David Legwand | C | 33 | $3,576,923 | - | - | $3,576,923 | | $3,576,923 | $3,576,923 | 6.02 |
Kevin Klein | D | 28 | $1,680,513 | - | - | $1,680,513 | | $1,680,513 | $1,680,513 | 2.83 |
Matt Hendricks | LW | 32 | $1,005,641 | - | - | $1,005,641 | | $1,005,641 | $1,005,641 | 1.69 |
Devan Dubnyk | G | 27 | $875,000 | - | - | $875,000 | | $619,231 | $619,231 | 1.04 |
Filip Forsberg | C | 19 | $343,910 | - | - | $343,910 | | $343,910 | $343,910 | 0.58 |
Marek Mazanec | G | 22 | $228,359 | - | - | - | | $228,359 | $228,359 | 0.38 |
Taylor Beck | RW | 22 | $77,846 | - | - | $77,846 | | $77,846 | $77,846 | 0.13 |
Magnus Hellberg | G | 22 | $52,056 | - | - | - | | $52,056 | $52,056 | 0.09 |
Simon Moser | LW | 24 | $43,846 | - | - | - | | $43,846 | $43,846 | 0.07 |
Joe Piskula | D | 29 | $14,103 | - | - | - | | $14,103 | $14,103 | 0.02 |
Mark Van Guilder | C | 29 | $2,821 | - | - | - | | $2,821 | $2,821 | 0.00 |
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2013-2014 Cap Totals
Notice Dubnyk cap hit isn't 100% . It is because Edmonton retained lowering the cap hit