Placing five players on waivers Sunday afternoon, the Red Wings were expected to have 23 players on the NHL roster including 13th forward Austin Watson, who earned a contract during his professional tryout (PTO).
Key word: expected. In actuality, the Red Wings put Watson on waivers for an AHL assignment, leaving them with 12 forwards, seven defensemen and three goaltenders on the roster. After much was made about how Detroit might open up a tight roster spot to house Watson or prospect Marco Kasper, in the end the Red Wings opted to clear a spot to leave open.
Why? The answer has to do with the way the NHL’s salary cap functions, as well as how waiver wire rules affect player movement.
Let’s start with the waiver rules, because those are the rules that open up so many possibilities for Detroit. In the NHL, waiver rules require that players who have played a certain number of games or played a certain number of years after signing their entry-level contract be offered up for other teams to acquire for free before they can be sent down to the minors. From a team perspective, this promotes competitive balance so teams can’t just load up a bunch of depth players and bury them on the farm team. From a player perspective, this maximizes their options to play in the NHL.
What’s important to know about waivers is that once a player is sent down on waivers, they have a little bit of a grace period if they are called up to the NHL. The CBA outlines that if a player who has previously gone on waivers is called up, they are not eligible to go on waivers if they have played less than 10 NHL games and 30 days have passed since they last cleared. If one of those conditions is not met — a player gets into 10 games or it’s been 31 days since they were first sent down — then the player has to go on waivers again to clear.
To illustrate this, let’s look at the example of Justin Holl. The 32-year-old defenseman was put on waivers Sunday, and he cleared Monday afternoon. That means that if the Red Wings were to call him up, they could send him down without putting him on waivers for the next month, so long as he doesn’t play 10 NHL games. It’s a handy tool for the Red Wings, who banked on teams turning their nose up at Holl’s two years of remaining contract at $3.4 million AAV.
However, the roster spot Holl’s waiver placement freed up was used to sign Watson, who was placed on waivers for an AHL assignment Monday afternoon. That leaves 22 out of 23 roster spots filled. So if Detroit isn’t going to fill that roster spot, why send Holl down at all? Why go through all the extra trouble? It all comes down to the way cap space works.
Most of us are familiar with cap space as a year-long concept. If a player signs for $1 million, then a team is committing $1 million in cap space to them for the season. But cap hit is actually calculated by prorating the daily cap hit through however many days are left in the season. So long as a team doesn’t take advantage of long term injured reserve, whatever is left over to reach the salary cap is saved up as something called accrued cap space.
Accrued cap space is calculated with the formula: Projected Cap Space x (Total Days in the Season / Days Left in the Season). Accrued cap space is essentially saved up cap space that teams can use to afford bigger transactions later on. Let’s say a team comes in $2 million under the salary cap all season. By the 100th day of the 192-game season, they can spend $3.84 million and still be under the salary cap.
This accrued cap space is very useful. It allows teams to acquire players at the trade deadline when they would otherwise come in over the salary cap. Blogger Brett Lee broke this down well in a Substack post in 2023. I highly recommend you read his work.
So what does this have to do with Justin Holl? The Red Wings save $1.15 million in cap relief by sending him down to the AHL. On a daily basis, that is $5,989.58 in daily cap savings. This money, accumulated over however long he isn’t with the NHL team, can be used to pay the remaining cap hit later on a potential acquisition. Detroit already needed to send him down to clear the roster space to sign Watson without exceeding the 23-man roster limit. Now that he has cleared, there is no incentive to call him up early because Detroit is saving up cap space to use later each day he is on the AHL books.
Cap space is also accrued by not calling up a player to fill that 23rd roster spot that Watson’s AHL assignment opens up. And as Detroit already has the players for its opening night roster in place, there is no reason to fill that space with a player who won’t play. The open roster spot allows the Red Wings to make appropriate moves in the future — calling up Holl, Watson or even rookie Marco Kasper — while still accruing cap space.
These moves are all about flexibility — both for the usage of Holl, the usage of the final roster spot and the usage of accrued cap space later on.
If we extrapolate the Red Wings’ current cap situation, PuckPedia reports that the Red Wings would have around $2.6 million in annual cap space at the NHL trade deadline. That’s going to fluctuate based on call-ups and injuries, but it is a decent chunk of change to work with for a potential acquisition.
Will the Red Wings actually use this cap space? That’s something we probably won’t know until around the trade deadline. But for now, there is no reason for Detroit not to save up some cap space to potentially use later.
So while the Red Wings’ leaving a roster spot open might seem strange, it’s all just part of the complicated business of the NHL salary cap.
Note: this article was updated to correct waiver eligibility details.
Also from THN Detroit
How Austin Watson Turned a PTO into a Contract with the Red Wings
In Tarasenko, Detroit Hopes to Add Championship Blend of Skill & Grit
Breaking: Red Wings Trim Roster Down to 28
Red Wings Place Holl on Waivers
Three Takeaways from the Red Wings’ 3-2, Preseason Finale Loss to the Maple Leafs
Multitude of Roster Moves Cuts Red Wings’ Roster to 41
Role Versatility Puts NHL Within Grasp for Red Wings’ Top Prospects
Three Takeaways from the Red Wings’ Loss to Ottawa
Three Takeaways from Red Wings’ 2-0 loss to Toronto Maple Leafs
