NHL Lockout: Who Wins, Who Loses If Rookie Contracts Are Two Years?

Steve SilvermanFeatured ColumnistNovember 23, 2012

Tyler Seguin signed a huge contract extension with the Boston Bruins after his second season.
Tyler Seguin signed a huge contract extension with the Boston Bruins after his second season.Bruce Bennett/Getty Images

The NHL is in the process of hammering the NHL Players' Association in the ongoing dispute that passes for negotiations as the two sides attempt to come to an agreement on a new Collective Bargaining Agreement.

Much of the attention—and rightly so—is on the way revenue will be split over the life of a new deal. It appears as if the NHLPA has come close to meeting the league's demands on a 50-50 revenue split, according to TSN.ca.

The length of rookie contracts is another issue that the league wants to change.

In the last CBA, rookies had the opportunities to sign three-year deals. In these negotiations, the NHL is proposing that rookies sign two-year contracts.

While this is considered to be a minor issue, the idea behind reducing the length of these contracts is that it gives the league's youngest and most inexperienced players less time to prove themselves before signing the second contract.

The second contract can prove to be quite lucrative. During the offseason, Taylor Hall of the Edmonton Oilers and Tyler Seguin of the Boston Bruins both signed huge second contracts.

Hall, 21, signed a seven-year, $42 million deal, according to nbcsports.com, while Seguin, 20, inked a six-year, $34 million contract. Hall and Seguin were selected first and second in the 2010 draft.

Both made the NHL the year they were drafted and had two years of NHL experience. Neither of their teams were obligated to give them new contracts after two years. But with the CBA coming to an end, the Oilers and the Bruins both wanted to assure that their young stars would continue to play with them for the foreseeable future.

However, most young players don't demonstrate their talent so early in their careers. Players are almost always in the developmental phase after two years and are not close to performing at a star level.

Those players would not get the megabucks deals that Hall and Seguin signed this summer.

They would have to sign lesser contracts as they continue to rise through the ranks on the way to becoming eventual stars.

Players who have to wait later in their career to sign big contracts would presumably earn less money over the length of their careers than youngsters like Hall and Seguin who have already hit the jackpot with their second contracts.

However, the new two-year contract won't completely turn off the faucet that delivers huge contracts to young players. If a player can establish himself in his first two years or the youngster has so much talent and potential, the team won't want to take a chance on losing him to another team that would be willing to pay the price for signing another team's restricted free agent.

Joe Haggerty of CSNNE.com also points out that a two-year entry-level deal might also entice some European players to come to the NHL who might otherwise stay home. They would get a bigger contract by their third year instead of their fourth, and European players would find this more lucrative than the current system.

The proposed two-year entry-level deal favors the teams over the young players that employ them in most cases, but it also allows the younger star players to make more money earlier in their careers.

It is unlikely that this issue will become a sticking point that prevents the two sides from coming to an eventual agreement. It has both positive and negative ramifications for both sides, making it an issue the players can accept without having to swallow any more pride.