Nathan Mackinnon signed a record-breaking eight-year deal with the Colorado Avalanche a week ago, but the NHL contracts mean much more for the league than just a change in the record books.
Previously on one of the best-value contracts in the game, Mackinnon doubled his average annual value to $12.6 million, passing Connor McDavid for the richest NHL contract in the league by just $100,000 a year.
Mackinnon’s new deal is the result of a growing trend over the past few years: star players have recognized the value they bring to their team, and they expect to be paid their market rate.
The owner of the Dallas Stars, Tony Gaglardi, commented on the trend recently in an interview with the Cam and Strick Podcast.
“What’s really happening is the stars are taking all the money,” Gaglardi said. “And the guys in the middle are getting squeezed. So, you know, the veterans who don’t score a lot are getting squeezed.”
Gaglardi made these comments in reference to one of his own stars, Jason Robertson, who is currently negotiating a new contract with the team. Robertson netted 41 goals and 79 points last season, leading the team in goals, powerplay goals, game-winning goals, and plus/minus.
Robertson is not simply a star; he is the feature point of the Dallas offence. And he expects to be paid for the value he creates.
The going rate for a young star of Robertson’s calibre has climbed in recent years as Kirill Kaprizov signed for $9 million per year after one season, Mitch Marner received a contract for just under $11 million per year after three seasons, and of course, the two major contracts are Connor McDavid signed for a $12.5 million average annual value and Auston Matthews for $11,634,000, both coming off their three-year entry-level deals.
Mackinnon serves as both a cautionary tale and a beacon of hope for young stars like Robertson. Players coming off entry-level deals may look at Mackinnon’s previous deal (a seven-year, $44-million pact) as evidence of settling for a team-friendly contract. In exchange for security, Mackinnon potentially left tens of millions of dollars on the table.
On the other hand, established stars may see his new, record-setting deal as a sign the cultural salary cap has been lifted.
Unlike in other professional sports leagues, where a record contract is handed out nearly every offseason, the NHL had effectively created two caps on an individual player’s salary until Mackinnon signed.
First, the collective bargaining agreement dictates no player can make more than 20% of the cap (a $16,500,000 AAV under the current cap). Second, the McDavid deal served as a player cap. No one is better than McDavid, so no one asked for McDavid-grade money. That is until Nathan Mackinnon asked for just that and received McDavid money.
Mackinnon’s breakthrough opens the door for other players to push the limits of their average annual value – and there’s one massive name to watch: Auston Matthews.
The forward’s contract expires in two years, and he can begin negotiating a contract extension with the Toronto Maple Leafs in one year. Matthews is no stranger to asking for what he’s worth, and now that Mackinnon has set the stage, Matthews is only limited by the CBA.
Matthews is the key because if he crosses the new Mackinnon line, the NHL may finally see a transition to a salary culture closer to other pro leagues where athletes constantly strive for the highest average annual value. Rather than a major story, a record AAV will be an expected off-season storyline.
Of course, NHL general managers aren’t blind to this trend. In recent years, forward-looking managers have locked up solid NHL players to long-term NHL contracts to avoid bigger contracts in the future. Basically, for every player searching for the new Mackinnon deal, there’s a manager looking to sign them to the previous Mackinnon deal.
In fact, just this offseason, five players coming off their entry-level deals were awarded contracts for eight years and around $8 million per year. In a group that includes Jordan Kyrou, Tim Stützle, Josh Norris, Mikhail Sergachev, and Robert Thomas, two players have passed the 60-point threshold (Kyrou, Thomas) and one has passed the 30-goal plateau (Norris).
While each player is productive and valuable in their own right, their contracts say more about the player’s future than their past. If star players start commanding north of $13 million per year, those contracts will (and to a certain extent, already do) look like a bargain.
Mackinnon’s started a timer that will only stop when Matthews signs. Players and managers across the league will have to follow the situation closely – the entire league structure depends on it.