The Leafs are kicking a lot of tires today. Pretty much anybody is at play, whether you’re a soon to be UFA fourth liner or a top liner. As such, people are discussing ways to maximize value in the next three or four hours. Salary retention has been increasingly discussed.
What is salary retention?
You’re probably very aware of what the concept of salary retention is, seeing as the Leafs have engaged in it multiple times since it’s been added into the Collective Bargaining Agreement. But in case you aren’t, it’s a make-shift way of trading cap space.
In short, when you trade a player, you’re also able to hold on to up to 50% of his cap hit / paid salary.
Can the Leafs retain salary?
There aren’t many other rules for retaining salary, but one of them is that you can only retain on three contracts at a time. At the moment, the Toronto Maple Leafs are retaining on two contracts; $200,000 on Carl Gunnarsson’s deal for this year and the two following, and half of Daniel Winnik’s contract for the remainder of this year. This gives them one more retention for the rest of the year, and two more for the next two and change.
One last rule to bring up. If you retain for one year, you retain for them all. There’s no way to pick specific years, so the Leafs should act with extreme hesitance.
Take Dion Phaneuf for example. Speculation is that the Detroit Red Wings want him, but want the Leafs to retain $2 million. The problem with that is that he has six more years on his deal, and rebuilds don’t typically take six years. Barring complete ineptitude, the Leafs should be competitive again long before that deal is done, and every penny counts.
Sure, you might get a little bit less for him, or any of the longer term players if you don’t eat a bit of salary, but barring a drastic overpayment, it would make more sense to take a lower-value return with less dis-incentive.
For the shorter term deals, however? Go for it. The Leafs probably don’t need the money for another year or two, so if you’re looking at trading an Olli Jokinen, Roman Polak, or Jonathan Bernier (among others), it’s not a bad idea. The Winnik trade is an example of a good use of one of those spots; $500,000 (and Zach Sill) means absolutely nothing to the Leafs for the rest of the year, but everything to the Penguins. That increased his value and got the Leafs future assets for very temporary hindrance.
In summation, retention is a good way to add value to some of the players being sold today, but should be used with caution. Those avoided cap penalties could go a long way when the team is competitive.