Saturday, June 28, 2008

Free Agency Under The Current CBA

The Central Bargaining Agreement in the NHL changed free agency considerably by lowering the age of unrestricted free agency (to as low as 25 in some cases) and reducing the compensation for restricted free agents. Many thought this was a thinly veiled attempt to allow the best players in the NHL the freedom to sign in the best markets of the league before they reached an age where they were in decline. It hasn't worked out this way. Last year the only top 50 ranked player by The Hockey News to change teams was Ryan Smyth. This year is also a weak pool. It seems to be a trend that there are not a lot of quality free agents. Why is that?

The lowered free agency age has forced teams to sign up their young stars. After their entry level contracts, young star players are signed for far more money than they were in previous CBA and often for longer terms. Teams are paying for potential. In the cases where a player does not develop as expected, he will have a very bad contract.

From the point of view of a young player, this is a good thing. In the past, teams would often play hardball on the player's second contract as the player had little leverage. This has hurt the relations between players and made them more likely to leave when they did become unrestricted free agents. Now with the young players increased leverage, the team pays him closer to his market value at an earlier point in his career. They player is happy with that and the best players rarely reach free agency.

There still are plenty of free agents, but they are usually fringe players who are not important to their previous team. The team figures they can find somebody at least as good (if not better) from other sources (and often at a cheaper salary). Teams can fill out the bottom part of their roster with free agency and might do well if they find a real bargain, but they cannot make a huge change in franchise direction by signing free agents.

The idea that a team will make a splash in the free agent market and turn things around is largely a myth. It is one believed by many fans and often encouraged by team's that promise big results via free agency, but it isn't actually true.

This CBA has opened up the idea of signing restricted free agents. In the past, it was a worthless game. Teams would match the offer and nothing was accomplished except for driving up salaries. The compensation for signing an RFA was so high it was usually prohibitive. With lower compensation, escrow and a salary cap much of that changes. It is impossible to drive salaries up by signing players. Salaries are a set percentage of NHL revenue. The total number paid in salaries does not change if you sign a player to a big contract (it changes the distribution among players - but not the total amount). The salary cap provides an upper limit for teams to spend on salary. If you can push a team near or over the cap you might be able to get them to give you the player and not match the offer. At the very least you have limited any other future moves the team may be able to make by reducing salary cap space. This makes the idea of signing restricted free agents viable.

There have been three offer sheets signed by restricted free agents so far. In 2006, Philadelphia signed Ryan Kesler of Vancouver but the offer was matched. In 2007, Edmonton signed Tomas Vanek of Buffalo to an offer sheet that Buffalo matched and then successfully signed Dustin Penner from Anaheim. These moves did little to improve Edmonton and cost some draft picks that might be valuable to a rebuilding team, but they showed the world that restricted free agents can be signed. They were desperation moves because Edmonton GM promised a big splash in free agency, and since that is nearly impossible, he had to do something to keep fans happy. That doesn't mean a team cannot sign a restricted free agent and have it be a good move. It is possible. The best teams in the NHL have the best chance to do this as their draft picks will be later in the draft and thus less valuable.

To be a good RFA signing, a player must be good enough to be worth his salary and the compensation. His offer sheet must be big enough to keep his current team from matching. That means you will not successfully sign RFA's to small contracts. You have to sign them to big deals and they must be good enough players to justify it.

The CBA lays out the rules for free agency. It has changed the way free agency works in the NHL. Reducing free agency ages have increased the bargaining power of young players in the NHL. These young players tend to sign big longterm contracts before reaching free agency, thus leaving a small number of talented unrestricted free agents. Teams that try to build with free agency fail because of the lack of available talent. There are lots of potentially valuable role player free agents available. The right signing can really help a team, but it will not make a non-contender into a good team. The prospect of signing restricted free agents is increased under this CBA, but not substantially. There are only a couple players any season who are worth signing to large offer sheets. It seems that teams will turn to restricted free agent signings when they failed to make a big splash with unrestricted free agents and that will lead to poor decisions - that is how the Edmonton Oilers operated last summer.

Comments: Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?