Browsing: escrow

With the NHL’s salary cap hitting a new high this year, and set to make a series of jumps over the next few seasons, players are earning more than ever before. We’re seeing that with the latest wave of contracts coming in.

But according to Sportsnet’s Elliotte Friedman, players can expect more good news on the financial front when it comes to escrow, too.

“I’m under the understanding that the players have been told that there’s money coming back to them,” Friedman explained during Monday’s edition of 32 Thoughts: The Podcast.

According to Friedman, players “have been informed that this year, none of their paycheque is being withheld.”

“The predictions are strong enough, and the revenues are strong enough, that zero is being taken off their cheques,” he said.

• 
• 32 Thoughts: The Podcast

  Hockey fans already know the name, but this is not the blog. From Sportsnet, 32 Thoughts: The Podcast with NHL Insider Elliotte Friedman and Kyle Bukauskas is a weekly deep dive into the biggest news and interviews from the hockey world.

  Latest episode

Escrow isn’t exactly a thrilling subject, but it tells us a lot about where the league is. And according to projections, the NHL is in a very good place these days. Here’s how Friedman explained it:

“Every year, a percentage of the players’ salaries are held back in an escrow account, just to make sure that at the end of the year the revenues end up 50-50,” he said. “And if they end up too much on the players’ side, then that money goes back towards the league and the owners. If they end up too much on the league’s side, then that money goes back towards the players.”

Revenue growth took a hit in 2020, and with that came an increase in escrow to even things out. To lessen the burden on the players, the NHL and NHLPA agreed to a plan that smoothed out those payments over a longer period of time.

“One of the reasons the cap never went up in the last few years, was because the players owed money to the league and the owners for all those games that were played with no fans,” said Friedman. “They’d reached a deal where the debt couldn’t be paid off that quickly. But now the debt’s paid off.”

As a result, the salary cap ceiling has gone up — way up. It’s projected to hit $104 million next season, though as Friedman wrote on his latest edition of the 32 Thoughts blog, and spoke about again on the podcast, that number could be even higher. We could see the 2026-27 ceiling come in closer to $107 million.

In addition to positive projections to come, Friedman also spoke about players seeing escrow paid over the last few years returned to them.

“I understand the players have been told that they’ll be getting money back from 2022-23, they’ll be getting money back from 2023-24, a full refund of what was held,” he said, adding, “I think they’ve been told they’re getting a little bit more.”

Not since the beginning of the salary cap era has that happened, noted Friedman.

“All the accounting for the past three seasons is now getting done, and the players will at least be made whole 100 per cent — and in some cases, they’re getting more,” he said.

While cap ceilings and future escrow numbers are still projections, there’s a chance we get some clarity soon as the topic could be on the table when the league host Board of Governors meetings in New York this week.

“That’s why there’s talk about the number going up — because the question is gonna be, ‘would you rather the cap go up, or would you want to give the players extra money in the future?— explained Friedman. “That’s why this conversation is out there. And we’ll see what Bettman says to the Board of Governors this week.”

Source link