NHL, NHLPA announce potential payroll ranges for next three seasons

Cap figures are going way up, subject to an extension of the CBA

The financial future of the NHL is about to change, and the league and the union have laid out a potential road map of salary cap structures in the coming years.

From the report:

The National Hockey League and the National Hockey League Players’ Association announced today an agreement that will provide increased predictability on core Salary Cap economics for a minimum of the next three years (through 2027-28).

The agreement sets the following annual increases to the Upper Limit, subject to the Collective Bargaining Agreement being in effect beyond the 2025-26 season:

2025-26: $7.5 million

2026-27: $8.5 million

2027-28: $9.5 million

Those increases would set Team Payroll Ranges for the next three seasons to:

2025-26

Upper Limit: $95.5 Million

Lower Limit: $70.6 Million

2026-27

Upper Limit: $104 Million

Lower Limit: $76.9 Million

2027-28

Upper Limit: $113.5 Million

Lower Limit: $83.9 Million

The projected Team Payroll Ranges for the 2026-27 and 2027-28 seasons will be subject to potential minor adjustments (up or down).

The parties still intend to meet to discuss other elements of the Collective Bargaining Agreement that might need modification and/or improvement beyond the 2025-26 season.

NHL Deputy commissioner Bill Daly had this comment:

The upper limit of NHL’s salary cap has hovered in the range around $80 million, give or take from 2018-19 to 2023-24, before increasing to $88 million this season after the residual business effects of COVID have finally dissipated.

Since then the NHL has morphed into an increasingly healthy business. The league has relatively new national TV contracts with both ESPN and Warner Brothers Discovery. The NHL is selling ad space on jerseys, digitally on broadcasts and making a buck just about anywhere they can. It’s working. The long feared escrow, where players would have as much as 20% of their contracts withheld and trued up based on actual league revenues, has completely disappeared. In fact, players should be in store to return all their 2023-24 escrow plus get a 1.5% to 2% bonus on their contracts from last season due to the league taking in more than they paid out.

Another aspect to monitor will be seeing how many teams are able to continue chasing the upper limit of the cap. Currently in 2024-25, all but six teams are within $5 million of the maximum. Double that number of 12 teams are over the “upper limit” due to long-term injured reserve commitments.

When the cap quickly increases up to and past $100 million, how many clubs will have the willingness to chase.

For the players, it’s a good situation to be in, and one where their stars might finally get the opportunity to cash in the mega bucks. 25 years ago in the year 2000 (scary sentence to type), the NHL’s top paid stars in Peter Forsberg, Paul Kariya and Jaromir Jagr each made $10 million per season. A quarter of a decade later, the ceiling for salaries has barely raised in the NHL, Auston Matthews’ league-leading cap hit is $13.25 million currently (Edmonton’s Leon Draisaitl will raise that bar next year with a $14 million cap hit).

Only 13 NHL players currently have a cap hit north of $10 million, which even before adjusting for inflation shows barely any movement compared to other North American pro leagues. The NBA’s highest paid player in 2000 (Kevin Garnett) had a $19 million salary per ESPN. 87 players today clear that cap hit, led by Steph Curry’s figure north of a whopping $55 million. Similarly. the NFL’s top players have seen their salaries explode in the past decade over growths in their revenue.

Such movement hasn’t happened in hockey, though in time that could change. Connor McDavid will have a new contract in 2026-27, the 20% max player salary based on the figures above would mean he is eligible to sign for up to $20.8 million annually. Other stars like Matthews, Cale Makar and Nathan MacKinnon should be in for similar drastic increases in salary by the time their next contracts come due in 2027 and 2028.

A rising cap could mean other benefits too, since bad contracts won’t be as restrictive or confining as they have been during the recent post-COVID years when teams have been under major stress to remain under the salary cap and often resort to trading decent players for little to nothing in order to remain compliant, resorting in a “game within the game” where salary situations trump more surface level enjoyment of the sport.

Of course, the disclaimer to all these fancy numbers will only come to pass if and when the NHL and NHLPA formally sign of on an extended collective bargaining agreement. The current arrangement ends after the 2025-26 season. However, the good and really encouraging news is that the labor landscape is light years better in terms of where the NHL/NHLPA relationship was back in 2004 or even 2012 when both sides were more combative instance and lockouts occurred before agreements were reached. Given that times are looking so good, neither side has much reason to dig in for a work stoppage this time around, which means all parties should come out as winners.

Nothing’s over until the ink is dry, but the financial future of the NHL shows a growing and successful sport ready to take further steps into making money for players and owners alike.