Salary cap issues may not be the only thing coming for the Montreal Canadiens and the rest of the NHL as escrow could see an increase as well.
When it comes to finances in the NHL, two words always come to mind: the salary cap and escrow. The first is a no-brainer as it determines how much money a team can spend in a given year. Several teams around the year have struggled to keep themselves underneath the ceiling making use of trades and long-term injured reserve to do so. The Montreal Canadiens have luckily been on the positive side of the salary cap for a long time and staying compliant hasn’t been an issue in this era.
The second word, being escrow, is something the average fan doesn’t care too much for despite it having an impact on the state of the NHL. Escrow was put in place after a new CBA agreement was instated before the start of the 2012-13 season. The latest lockout saw the NHL and NHLPA agree on a 50-50 revenue sharing. Escrow, therefore, is a certain percentage of a player’s salary taken to make sure the 50-50 split is in effect.
Players aren’t too pleased with escrow and do their best to keep it as low as possible each year. That’s why the salary cap didn’t jump as high as initially predicted last year.
The players could’ve decided to increase the ceiling by 5%, which saw an initial projection of about $83 million. But doing so would’ve also increased escrow. The players instead chose only to have the salary cap go up to $81.5 million such that escrow was only at 9.5%.