As the salary cap rises, players should consider new types of contracts

For some time in the NHL now, players have signed contracts for the most total years they could get. That only made sense, right? The salary cap was flat, with little to no wiggle room, so if you found a team willing to commit a decent amount of money against that cap to you, you wanted to make them do it for as long as conceivably possible. It was security in a league that offers it to few.

Superstars did eight-year deals, and those contracts were the mark of having achieved true stardom. These were your no-doubters, your Hall-of-Fame contenders. There were rare exceptions such as Auston Matthews, whose agent Judd Moldaver apparently put some thought into getting to UFA and the chance to sign new deals sooner, particularly as the cap might move (all when the guy was still young), but he was part of a minority.

I get players not wanting to pass on guaranteed money, but if you truly believe youâ€re in the leagueâ€s upper percentile, man did the Matthews way always make sense to me. I got killed on my show for defending it (it was viewed as a lack of commitment, if I recall?), but it was always the most practical “commit to a team but also get paid-paid†decision. Heâ€s going to be a UFA in summer of 2028, and can re-sign on July 1 of 2027, when heâ€ll be 29 with a bajillion goals in the bank in a massively inflated salary cap environment.

It’s with that in mind that Iâ€ve seen some of the new deals some young stars are signing and thought ‘Boy … Are you sure?‘

The deals are long, and theyâ€re not just for proven superstars anymore.

And yet, Iâ€m not sure thatâ€s a win for those players in the same way that it used to be.

Luke Hughes just signed a contract worth $9 million per season for seven years, which takes him to age 29. Heâ€s super young to get a deal like that, and thatâ€s just awesome, of course. Who am I to sit here and say a kid at 22 shouldnâ€t take the security of $63 million dollars? Of course he should. Heâ€s set for life now.

Luke Hughes is also a big-bodied D-man who at age 20 put up just shy of 50 points, and he played at a slightly better pace the next year at age 21. If he signs for three or four or even five years at a lower AAV, what does his next deal look like at age 25 or 26 in this growing-crazier-by-the-day cap environment?

You canâ€t know, but if he gets at all better than heâ€s currently been – which is exceedingly likely given his age and position – that contract would come in the wake of a skyrocketing cap and deals to Cale Makar and Quinn Hughes that could set monstrous precedents. Regarding Makar, you can call it apples to oranges, but there’s not a team in the league that would take Kirill Kaprizov before Makar. Even if the Avs defender doesnâ€t get to $17 million a season, heâ€s certainly got a case for it.

By then, Luke Hughes might be worth … what? Could it be $13 million? 14? Iâ€d expect heâ€d make up a few lost million in the short term pretty quick and go racing by that $63 million number in the other direction. In a world where people have gotten annoying about saying “Bet on yourself,†Iâ€ve been surprised how few young stars have taken that course.

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Mason McTavish, fresh off 52 points with 22 goals during his age 21/22 season, just re-signed for six years and $7 million per year. Six years is better than seven, but it still feels like a lot to commit when your upside is so high.

This cap environment should shift the focus from dollars to term for the high end young guys.

Teams today are greatly incentivized to lock up their young talents before theyâ€ve proven all that much (beyond potential) in the NHL. That trade of “security†is their most valuable tool right now. Luke Hughes has been great, but has yet to be the cornerstone of a D-corps thatâ€s had success deep in the playoffs. And yet for teams, the value is that he hasnâ€tdone it yet. Theyâ€re learning that itâ€s time to pay for (just less than) what you expect players to do, rather than for what theyâ€ve done in the past. Theyâ€re hoping to get that “You actually havenâ€t done anything yet†discount.

If you look around the NHL, almost all of the best contracts are because GMs saw players about to blow up and paid them on the maximum term the players would give them, before the break out happened.

Nathan MacKinnonâ€s run of being staggeringly underpaid due to taking max term deals will continue almost immediately after he got his raise to $12.6 million. Lukeâ€s brother Quinn is a perennial Norris threat earning under $8 million after a six-year deal that he signed at age 20. Great job by the Canucks there. Their brother Jack has maybe the most team-friendly deal in the NHL, and when he signed his 8×8 contract people were apoplectic because he “hadnâ€t done anything yet.â€

What Jack Hughes had done was show that obviously he was going to be one of the leagueâ€s better offensive forces. And with the assumption that the salary cap would go up again eventually – we all knew it would in time – the Devils were correct that it wouldnâ€t take long for Hughes to be a massive bargain.

Jack has five more seasons at that $8 million mark, until 2030, and over that time, if he plays up to his potential, heâ€s probably worth $14 million a season. Heâ€s only 24 and already has a 99-point campaign. The bigger note, though, is that if he never got to the top of his potential, or even close, that deal is still fine! Theyâ€ve only paid him to be “pretty good,†at this point. These days $8 million is Pavel Buchnevich and Josh Norris money. Giving those years away for “security†is going to cost Jack tens of millions of dollars.

If you want to say “It doesnâ€t matter, heâ€s not going hungry,†then weâ€re not in the same conversation. The point is, all these “security†deals that teams are giving to young players are the smartest contract wins they can get. Itâ€s great for the teams, kudos, and so if they truly believe in their young talents, nowâ€s the time to take the big swing.

Seth Jarvis†long-term deal ($7.42 million) makes him a value buy. Brandon Hagelâ€s long-term deal ($6.5 million) makes him a value buy, and by “value†I mean like “50 per cent off.â€

The players now have real decisions to make, because “Which tier player am I in†is now the personal assessment for young guys.

The challenge for them is that the bottom half of rosters arenâ€t going to see their numbers go up like the top guys are. Even the middle class isnâ€t in for a massive jump in pay, though it should tick up some. So, are you more of a middle-of-the-pack guy, who should be begging to go long while youâ€re young, before they figure out youâ€re just OK? Do you need to sell those years because youâ€re not sure what youâ€ll be? Or are you a player whoâ€s so good that maybe it makes more sense to go shorter, so you can cash in as the cap rises?

Hereâ€s an important quote from a recent article in The Athletic, attributed to an anonymous player agent. I share it to note that locking in now for long term means you may also miss a bigger bump than expected:

Agent 3: â€œSometimes itâ€s just luck and circumstance. Kaprizov had all of the right leverage — a rising cap, a team that had a bunch of guys already signed. The other reality is the capâ€s set too low this year. I think youâ€re going to find that the cap is not just going to be at $104 (million) next year, and I think that $113.5 (million in 2026-27) is going to end up being like $120 (million). So the cap is going to go much higher, and sometimes itâ€s timing and situation, and I think thatâ€s what happened here.â€

There is value in being a 25-goal, 55-point guy, but if your game slips from there, suddenly youâ€re in the group of guys who donâ€t get paid. Maybe those are the ones who want to lock in for as long as they can in this cap environment. Niko Mikkola is a good, 29-year-old, second pair defenceman for Florida. He’s a physical, penalty-killing defenceman who had a career-high 22 points last season. He signed an eight-year deal with a $5 million AAV on Thursday, which he may not have been given under a flat cap. But in this environment it makes a lot of sense. A middle-of-the-lineup player gets long-term security, and the team locks in a reliable veteran at a very comfortable rate.

But if youâ€re a burgeoning star, or even an established one – particularly if youâ€re under 30 – I find it hard to believe that a max term contract makes sense. There are exceptions, like when a team wants to give you $136 million a la Kaprizov, of course.

The calculus has changed, and players need to be careful about giving up years of service if they believe they can be stars. Young guys need to be careful with the term they give away, because for those guys in this new salary cap world, the skyâ€s the limit.

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