NHLSCAP.com - Salary Cap FAQ [and my notes on how it applies to Rathje and the Flyers' Cap Problems]
A player is considered to have a bona-fide long-term injury if, in the opinion of the team, the player has an injury which will cause him to miss at least 10 games and 24 days. Even in such cases, the player's salary will continue to count against the team's Upper Limit. This is mentioned at least three times in the CBA, and is repeated in Article 50.10(a):
All Player Salary and Bonuses paid to Players on an NHL Active Roster, Injured Reserve or Non Roster that are Unfit to Play – being either injured or suffering from an illness – shall be counted against a Club's Upper Limit, Actual Club Salary and Averaged Club Salary, as well as against the Players' Share.
For players that the team has filed an LTI exception, the team is allowed to exceed the cap by up to the amount of the injured player's salary with as many replacement players as needed, provided that when the injured player is activated the team comes into compliance with the cap immediately. The team does not get to automatically tack on the amount of the injured player's salary to the Upper Limit - an example as illustrated in Article 50.10(d) of the CBA illustrates this point:
(a) Illustration: A Player with a Player Salary of $1.5 million becomes unfit to play for more than 24 days and 10 games. At the time the Player becomes unfit to play, the Club has an Averaged Club Salary of $39.5 million, and the Upper Limit is $40 million. The Club may replace the unfit-to-play Player with another Player of Players with an aggregate Player Salary and Bonuses of up to $1.5 million. The first $500,000 of such replacement salary and bonuses shall count toward the Club's Average Club Salary, bringing the Averaged Club Salary to the Upper Limit. The Club may then exceed the Upper Limit by up to another $1 million as a result of the replacement salary and bonuses. However, if the unfit-to-play Player once again becomes fit to play, and the Club has not otherwise created any Payroll Room during the interim period, then the Player shall not be permitted to rejoin the Club until such time as the Club reduces its Averaged Club Salary to below the Upper Limit.
So - just because a player has a long-term injury does not automatically grant the team extra cap space. A team with a payroll of $44 million that has a player making $4 million get injured doesn't gain any extra cap space as a result; a team at $54 million and a player at $4 million only gains $1,300,000 (all pro-rated, of course). Relief toward the salary cap only comes if replacing an injured player's salary would push the team over the cap, and the amount of relief is limited to the amount the team would go over the cap - not the entire amount of the injured player's salary.
via NHLSCAP.com - Salary Cap FAQ (page 2).
I feel this is not just a technicality, but I'll be damned if I can figure out why. What's the difference, for instance, between (1) Rathje's $3.5MM cap hit being taken off the books, reducing PHI's cap hit accordingly, and (2) keeping it on the books but allowing PHI to exceed the cap ceiling, and then only to the exact extent it needs to, up to the limit of an overage of the total amount of the injured player's cap hit?
What is the f-ing point of saying, "Philly is allowed to exceed the cap ceiling by the amount that it has exceeded the cap ceiling, and not a penny more goddammit, but by the way if Philly wants to exceed it a little more it's more than welcome to, but only up to an overage equaling the cap hit of the injured player, and only until he comes back"???
Why not just say, "Philly's cap ceiling is increased by the amount of the injured player's cap hit"? Too easy?
Similarly, what the point of saying that, "all injured player's cap hits continue to count against the team's cap and will not be removed, and there will be no relief so don't even ask, unless of course replacing the injured player (up to the limit of the injured player's cap hit) causes the team to go over the cap ceiling, in which case okay fine be my guest"?
I mean, who cares what your cap hit is if you're in no danger of exceeding the ceiling? Is this some way to protect teams trying to stay at the floor, allowing them to do so with a roster of injured players? Could that really be it? Because it's about the only thing that makes any sense to me.