Behind the Dollar: The NFL and NHL Salary Caps Explained
Behind the scenes of every professional sports organization lies the value of the dollar. The National Football League and National Hockey League rely on player analytics and financial discussions about their respective salary caps to craft their rosters every year.
When analyzing these two league caps under a microscope, they are quite similar in certain aspects but differ on a few key points. Breaking down the differences between NFL and NHL salary caps visualizes the leagues’ operations.
Both the NFL and the NHL have what is called a hard salary cap, which means that there is an agreed-upon ceiling between the league and players association defined as the CBA, or collective bargaining agreement. The salary cap establishes the absolute maximum amount that the organizations can spend on player salaries.
Both the NFL and NHL must fill out their rosters by the established limit, but the organizations are not required to use the full cap amount allotted. In contrast, other sports organizations such as the NBA have a soft salary cap, which means that teams can exceed their caps if a desired player meets specific niche criteria.
Specifically for the NHL, the salary cap was introduced following the trend of superteams stacking their rosters with star players. The Detroit Red Wings’ former owner Mike Illitch was notorious for spending his own money to finance players and craft an impressive roster that left other teams with incompetent pocketbooks and unable to keep up. To prevent unfair advantage of one organization out-spending another, the NHL salary cap was born.
On the flip side, there’s the salary cap floor. The NHL salary floor introduces a fail-safe option to prevent teams from purposely throwing a season in order to place better in the draft order.
For the 2020-21 season, the NHL’s salary cap was posted at $81.5 million. Each athlete’s average dollar figure contracted within the cap represents a cap hit. The NHL’s current CBA was enacted on Sept. 16, 2012 and lasts for a decade until 2022. Each NHL organization can have a maximum of 50 contracts with no player portion exceeding 20% of cap space.
The NFL has a similar roster rule established for the adjusted 2020 season. In previous years, only 53 players were active during a game, but according to ESPN, the CBA increased the number to 55.
A key difference between the NFL’s and NHL’s salary cap system lies with player trades and waiver eligibility. Both leagues allow no-trade clauses in certain players’ contracts, which give the contracted athlete the power to accept or reject trades proposed by their organization.
The NFL athlete who most famously has a no-trade clause in place is quarterback Deshaun Watson, who is looking to find a way out of the Houston Texans organization. He has a say in which teams he can be traded to and can reject trade proposals that are undesirable.
In a similar way, goalie Marc-André Fleury of the Vegas Golden Knights has a no-trade clause with a 10-team list, which means that he must submit to the organization the 10 teams that he cannot be traded to in a given season. Fleury has had an impressive story with the Golden Knights after being an initial member of their expansion draft in 2017.
Another key difference between the NFL and NHL salary cap is how organizations release players. NFL teams have the power to cut their rosters any time during the season within the trade deadline. Any player traded after the deadline goes into the waiver system and can be claimed by any team.
Some notable players in free agency are defensive end J.J. Watt and Pittsburgh Steelers wide receiver JuJu Smith-Schuster. The 2021 NFL free agency period begins on March 17.
The NHL operates differently in that players must be bought out of their contracts. Age is a major factor when it comes to the size of a player’s buyout amount. If an athlete is over the age of 26, two-thirds of his contract worth can be bought out by an interested team. However, if the athlete is under the age of 26, only one-third of the contract’s value can be wagered.
The NHL offseason is about to be just as interesting as the NFL offseason. NHL fans should mark July 21, 2021, in their calendars as the date of the Seattle Kraken’s expansion draft. More managerial cap discussions are expected to heat up even as the ice melts at the conclusion of the regular season.
Emma Holtz is a freshman majoring in public relations. To contact her, email email@example.com.
About the Contributors
Freshman / Public Relations