Restricted Free Agent - NHL - Possible Outcomes

Possible Outcomes

If a player accepts a qualifying offer he remains with his current team for a one- or two-year term. The length of the contract is determined by the player. At the end of this contract the player becomes an Unrestricted Free Agent. While the player is in negotiation with his current team, other teams are allowed to extend Offer Sheets to him. Should the player sign a proposed Offer Sheet, his current team is notified as such, can no longer negotiate a new contract or trade the rights to negotiate and is left with 2 options, Accept or Decline. The current team has 5 days to make its decision.

• Accept The player remains with his current team on a contract identical to that of the Offer Sheet. The team is not allowed to trade the player for one year.

• Decline The player becomes a member of the team with whom he signed the Offer Sheet under all the terms of said Offer Sheet. His now former team claims draft picks from the player’s new team as compensation. Compensatory draft picks are determined by the player’s new salary on a sliding scale.

For example:

• In 2008 a team signing a restricted free agent to a salary averaging $2,615,625 to $3,923,437 per season will lose a first-round draft pick and a third-round draft pick to the player’s former team.
• Signing a restricted free agent to a contract worth over $6,539,062 per year costs a team four first-round draft picks.

At any point during the negotiation process, if the player has been in the NHL for longer than 4 years (less if the player signed his first contract after the age of 20), either the player or his current team may file for Salary Arbitration as a means of settling a contract dispute. At this point the player may no longer sign an Offer Sheet. The deadline to file for Salary Arbitration is July 5th with cases being heard between late July and early August.

• Salary Arbitration. Both the player and his current team submit their expectations for the player's salary for the coming year. The team cannot request a reduction in salary of greater than 15%. The arbitrator hears the case from both player and team and renders a verdict. The verdict sets the salary the team is required to pay the player. After the arbitrator's verdict is rendered, the team must make a decision within 48 hours of the verdict being rendered. If the team accepts, the player is signed to a new contract at the salary set in the verdict. Should the team decline, the player then becomes an unrestricted free agent.

A team can take a player to arbitration once in his career. Players may request salary arbitration as often as they please.