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Rand Simon's Blog: Keeping players in the fold

The Blackhawks may take Patrick Sharp to salary arbitration to prevent another team from signing to an offer sheet.

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The Blackhawks may take Patrick Sharp to salary arbitration to prevent another team from signing to an offer sheet.

My previous blog entry commented on NHL teams being proactive in getting players signed to contract extensions much earlier than they traditionally have in the past.

A new feature of the Collective Bargaining Agreement provides teams with another tool in order to ensure their players are signed: Club elected salary arbitration.

Under the former CBA, only players could file for salary arbitration. Under the current agreement, teams can take players to salary arbitration in one of two scenarios:

1. If a team feels a player is overpaid relative to his qualifying offer, but still worth having under contract, the team can elect salary arbitration on the player in lieu of submitting the qualifying offer.

2. If a player who is eligible for salary arbitration does not file, the team can take that player to salary arbitration.

Under the first scenario, the only players a team can take to arbitration are those making at least $1.5 million. Furthermore, the arbitrator in those cases can award a maximum pay cut of 15 percent.

It was under this clause of the CBA that the Philadelphia Flyers filed for salary arbitration against Joni Pitkanen last summer. After the scheduling of Pitkanen’s salary arbitration hearing, he was dealt to the Edmonton Oilers where he signed a contract for $2.4 million, which represented a $400,000 raise over his qualifying offer.

The Minnesota Wild took Derek Boogaard to salary arbitration last July under the second scenario noted above. The Wild wanted to ensure Boogaard would be signed – thus avoiding both a potential contract dispute at training camp and an offer sheet from another team – so they elected salary arbitration. Days before the scheduled hearing, the Minnesota enforcer signed a three-year contract for $2.625 million.

While there’s an expectation in the industry that the number of salary arbitration filings could be lower than last summer’s number of 32 (29 player, three team), don’t be surprised to see the number of team filings rise – especially since that action decreases the threat of an offer sheet.

Of course, those players eligible for salary arbitration still have some time to get an offer sheet since they become free agents on July 1, but the date for club-elected salary arbitration isn’t until July 6.

My Nov. 15 blog entry mentioned a few players who looked like strong salary arbitration candidates and several of them continue to build strong cases, especially Chicago’s Patrick Sharp, St. Louis’ Brad Boyes and Columbus’ Pascal Leclaire.

Some other players not mentioned in that column who have emerged to have strong salary arbitration cases include the Rangers’ Dan Girardi (his eight goals as of Jan. 10 have him tied for the fifth-most among NHL defensemen and he’s 10th in hits with 95) and Boston’s Dennis Wideman (the player traded for Boyes, who, in his 10 most recent games through Jan. 9, played at least 27 minutes in each).

WHEN AN EXTENSION ISN'T AN EXTENSION
There are seven players with 35 or more points who are playing in the final year of their contract and who entered the 2007-08 season eligible for Group 2 (restricted) free agency. Among those seven, Anaheim’s Corey Perry is the only one who hasn’t signed a contract extension.

The term “extension” is actually a misnomer and is still causing confusion among some fans and media members in terms of how an extension impacts a team’s payroll accounting.

When a player signs a contract extension (that’s the term used in Article 50.5f of the CBA), he is, in reality, signing a new contract, not an extension of his current agreement. Therefore, the “extension” isn’t factored into the team’s current year’s payroll accounting in any way, shape or form.

Take for example Dallas’s Mike Ribeiro, who signed a contract extension for five years at $25 million Monday. The $5 million average annual value of the extension has no bearing on the Stars’ payroll for this season as his current $2.8 million salary is what counts against the upper limit for the rest of 2007-08.

Ribeiro became the first player on a one-year contract to sign an extension (those players couldn’t re-sign until Jan. 1, 2008), but he certainly won’t be the last based on the number of discussions currently underway between teams and players.

By the way, contract extensions are covered by the same provision of the CBA in relation to a player sustaining a career-ending injury. So if a player has signed an extension, but sustains a career-ending injury, he’ll receive the full value of both his current contract and the one scheduled to take effect the following season.

Rand Simon is an NHLPA certified agent. He has spent the past 14 years with Newport Sports Management Inc.

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