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Two Way Contracts
How do two way contracts work? Does the parent (NHL) club pay the salary? What does the AHL team pay? What about draftees in junior? How do they get paid?
A Two-Way Contract means that the player earns a lower amount if he plays in the AHL compared to when he's in the NHL. The most common two-way contracts are entry-level contracts.
These contracts are with the NHL team, so it's the NHL team that pays the player, even if they're in the AHL. Depending on the ownership arrangement between the NHL team and the AHL team, there may be a cost sharing or reimbursement that is worked out between both organizations.
Players that were drafted out of junior and remain in junior are not paid. The exception is if they sign their entry-level contract with an NHL team that contains a signing bonus; they would receive the signing bonus even if they are sent back to Junior. If a drafted player starts the season and plays a few games in the NHL before being returned to Junior, they would receive the NHL amount on their contract pro-rated for the days they were on the NHL roster.
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