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A simple solution to the rookie wage scale problem

Image (1) JaMarcusRussell.jpg for post 71352

The various issues to be resolved in the current labor dispute include an effort by the NFL to reel in the windfalls paid to unproven rookies at the top of the draft.

The problem is real, though the causes of it are subject to debate.

Every year, the worst teams earn the top picks in the draft.  Every year, the growth of the value of the contracts given to the top picks in the draft outpaces every other trend relating to the compensation of NFL players.  And yet there’s no guarantee that the players taken at the top of the draft will ever earn their money.

Proven players don’t like it.  And they shouldn’t.  The money paid to players picked at the top of the draft makes them largely bulletproof, resulting in some of the bonus babies listening to nothing that veteran leaders — or anyone else, for that matter — have to say.

In 2009, we laid out the arguments for and against a rookie wage scale, and we’ll soon be dusting the articles off and re-posting them.  For now, we’re interested only in a fair solution.  And hopefully an easy solution.

As we see it, if teams don’t want to pay a ton of money to unproven players, let the players prove themselves before they get paid, with the possibility of getting a ton of money dangling before them as they try.

We propose two-year contracts for all draft picks.  After two years, the players would become exclusive-rights free agents, which is essentially what they are upon being drafted.  Basically, they have freedom to choose not to play for the team that holds their rights, but no freedom to play for any other team.

Then, after completing the initial two-year contract, the player can threaten to withhold services as leverage for getting the best possible deal, which is precisely the leverage that unsigned draft picks possess.  Or he can sign a one-year tender that would be based on playing time and possibly other factors, such as Pro Bowls and other achievements and awards.  Or the two sides can come together and agree to a long-term deal based not only on potential but also on two years of performance.

If a player not picked in the top 10 plays at a high level, like Titans running back Chris Johnson did during his first two years in the NFL, he can cash in like he would have done if he’d been a top pick.  If a player picked in the top 10 becomes a bust, like Raiders quarterback JaMarcus Russell, the team can give him a one-year tender offer based on the factors that will reflect his substandard performance, or the team can let him walk away.

After the third year, the player would be subject to the rules of restricted free agency, like every current third-year player whose contract has expired.  After four years, the player would be an unrestricted free agent, assuming that the next labor deal maintains a four-year path to unrestricted free agency.

This approach accounts for the contention that 60 percent of the league would fall under the league’s current proposal, which NFLPA executive director De Smith has called a “veteran wage scale.”  It also would address the league’s core concern regarding the consequences of giving millions of guaranteed dollars to a player who has never suited up at the NFL level.

The big money simply wouldn’t come due until after the player has had an opportunity to show that he can get it done.  With a salary cap/floor system, the money will end up being spent.  The question is where it will be spent, and under our proposal less of it will be spent on players who do nothing to earn it, and more will be spent on those who show in two years of service that they are among the best players in the game.

It’s an approach that’s fair to the teams, and it’s an approach that’s fair to the players.  And it’s the framework that the league and the NFLPA should be using to fix the problem.

The next question becomes whether the two sides really want to fix the problem, or whether they want to use the issue as a tool for addressing broader or different concerns.  If they’ll commit to addressing the real concern about which the league has been complaining for several years, our proposal provides the skeleton for the solution.

Our proposal may be far from perfect, but it’s far better than the proposals that the league or the union currently have made.

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43 Responses to “A simple solution to the rookie wage scale problem”
  1. commandercornpone says: Feb 12, 2011 12:05 PM

    i like it. but then, i am not duh smith.

  2. packfanwpg says: Feb 12, 2011 12:06 PM

    Performance based contracts, only fair solution.

  3. realitypolice says: Feb 12, 2011 12:09 PM

    I like it a lot better than the ridiculous 5 year contracts that the league is proposing for rookies.

    A well thought out, sensible PFT post. Human sacrifice, dogs and cats living together… mass hysteria!

  4. footballrulz says: Feb 12, 2011 12:12 PM

    What happens to a player like say, Aaron Rodgers, that comes into the league and rides the pine for two years?

  5. lgbarn says: Feb 12, 2011 12:19 PM

    Best solution that I have seen anywhere which means it has absolutely no chance of becoming reality.

  6. myspaceyourface says: Feb 12, 2011 12:20 PM

    Maybe all rookies sign a 3 year contract. . . That way they have time to start, sit, or somewhere in between.

    After their rookie contract is up, they can resign with the team that drafted them, after their 2nd contract they can become unrestricted FA’s.

    This will help teams build, it will relieve players from the franchise tag, which they hate so much.

  7. gtmann says: Feb 12, 2011 12:22 PM

    I like it

  8. mantastic54 says: Feb 12, 2011 12:31 PM

    I’d like it a lot better if everyone just got a three year deal and then became a RFA for a year before hitting free agency. Two years isn’t enough time to make a decision on most players

  9. barrypftharrison says: Feb 12, 2011 12:36 PM

    The only thing your idea does not address is the fans. What about those players who the fans just want to see? Tebow did not perform like a pro bowler but he did put many fans in the stadium and in front of the TV at home.

  10. contract says: Feb 12, 2011 12:42 PM

    “After two years, the players would become exclusive-rights free agents”

    Why exclusive rights? The players are taking a hit on the front end, so it’s only fair that they be able to cash in for full value after they have proven that they can play.

  11. madcowstahl says: Feb 12, 2011 12:48 PM

    NOT A SIMPLE SOLUTION. HUGE FLAW!!!

    This idea incentivizes owners to sit top draft choices for two years in order to cash in on cheap talent in years 3 and 4.

    It hugely favors owners.

  12. shaggytoodle says: Feb 12, 2011 12:50 PM

    Part of me likes it, but then part of me doesn’t, say GB for instance, they got Matthews locked in for 2-3 more seasons, they drafted a GREAT player, they they have to talk about contracts with pain in the butt agents.

    Its kind of a reward for GB for drafting good to keep him at a lower price instead having to pay him as the top 5 LBs which I am sure will be happening in a few seasons anyway.

  13. jc1958cool says: Feb 12, 2011 12:52 PM

    if they’re a free agent after 2 yrs, here’s what happens! if there really good, teams will try to buy him and the bidding wars will be like baseball! pick your poison

  14. swanie1 says: Feb 12, 2011 12:53 PM

    As Larry would say, Git-r-done

  15. madcowstahl says: Feb 12, 2011 12:53 PM

    A better solution is a standardized wage scale based on draft position. The 1st pick signs for this amount and the 76th pick signs for this amount. No negotiation. No options. Sign or sit a year. Those contracts are 3 years. The teams have the option to extend the contract at any time. After 3 years the player is an unrestricted free agent.

  16. allforfunnplay says: Feb 12, 2011 12:56 PM

    the current system isn’t fair to the rookies below the top 20 or NFL Franchises.

    Your solution isn’t fair to fans who do not want their team’s stars to easily go somewhere else. And it’s not fair to teams that risk their money on an unproven commodity, they don’t get any of the upside.

    The best solution is to simply pay Rookies their FAIR MARKET VALUE. But give teams a draft like slotting of Right of First Refusal on selected players. That way teams pay what they want for players and lesser teams still get an advantage to build their teams and players are paid what teams are willing to pay for them regardless of a draft position, they no longer complain that they were paid just because of their draft slot.

  17. livenbreathefootball says: Feb 12, 2011 12:56 PM

    For a starting point this is a great proposal. It needs a bit of tweaking. But what original proposal doesn’t?

  18. commandercornpone says: Feb 12, 2011 12:58 PM

    then they make it so the contracts end after year 4 unless renegoriated.

  19. wannabeqb says: Feb 12, 2011 1:05 PM

    Thats hardly fair, owners shouldn’t just get a pass for drafting badly. Making a bad decision should cost you something.

    Al Davis has drafted badly year after year, imagine who he would be picking if he could just dump them after 2 years!

  20. heybeerman95 says: Feb 12, 2011 1:05 PM

    I like it but too simple and makes too much sense. Neither side will go for it.

  21. hobartbaker says: Feb 12, 2011 1:09 PM

    Have them intern for a couple years. Volunteer work is always good for your resume.

  22. Burritto says: Feb 12, 2011 1:10 PM

    I don’t seen any flaws here. It’s even simple enough that it won’t confuse any casual fans.

  23. stataddict says: Feb 12, 2011 1:20 PM

    The complaints from the owners about the rookie wage scale really only apply to players taken in the first half of the first round where the contracts are for significant values. They do not complain when they get amazing values later.

    While cases like Ryan Leaf and Akili Smith are obvious lightning rods for the owners’ position. What about a player like Rob Gronkowski who has arguably performed at a level greater in one-season than his 4-year, $4.4m contract will pay over it’s complete lifetime?

    I’d prefer to see a system that would:

    A. Charge each NFL team a predetermined cost against the salary cap based on what round a player is drafted

    B. Guarantee a reasonable salary to incoming rookies based on where they are drafted

    C. Establish a performance-based incentive pool that all teams would have to pay into that would allocate additional money to players who attain certain performance metrics. These metrics could be based on: game day active, starts, statistics achieved, team wins, pro-bowl selections, etc. These allocations would be given out by a special master that would be appointed by the NFLPA as the NFL owners have already paid these monies into the pool.

  24. thehighhat says: Feb 12, 2011 1:21 PM

    You SHOULD have a picture of Alex Smith instead of Russell. I think Smith is the poster boy for setting a team back.

  25. mrnumbe says: Feb 12, 2011 1:30 PM

    This is why I like this site so much.

    Great post PFT. Excellent arguments, and by far the best solution I have seen or heard of thus far.

  26. ronvanl says: Feb 12, 2011 1:32 PM

    You call this a simple solution? It seems unnecessarily complicated to me. As packfanwpg says, an incentive-based contract for rookies is the only realistic solution. The league establishes a minimum salary starting with the lowest rated players.

    That would be undrafted free agents who make the practice squad. A realistic number to me would be 30K, which is pretty good for only working 6 months out of the year. Then 35K for undrafted FA who make the team. Next, 40K for the player drafted last (#255?), 40.5K for the player drafted next to last, and then $500 more for each higher draft position.

    $500 might not seem like much but when you add it up the player drafted #1 gets $167,000….just for being on the team without playing a single down. THEN you start paying heavily for performance. First incentive might be the number of games played. Next might be the average number of downs played per game, and so forth.

    Team should make it possible for a player like Sam Bradford to make $50 million over 6 years but ONLY based on performance….not guaranteed.

  27. redbear18 says: Feb 12, 2011 1:50 PM

    I think this is a good idea, but needs some of the details worked out. I think a good idea would be a graduated wage scale saying something like: 1st 10 picks can’t get any more than a 10 million dollar deal, picks 10-20 can’t get any more than 8 million, and they renegotiate the deal every two years until the rookie contract runs out.

  28. madcowstahl says: Feb 12, 2011 1:53 PM

    I like the idea of a set three year wage scale with built in incentives. You don’t need a pool for that money. The owners would need to cover it.

    You would need to protect the owners and fans by giving the drafting teams an advantage in signing after 3 years. Maybe after 3 years they are restricted free agents.

  29. chwtom says: Feb 12, 2011 2:11 PM

    I’d like to see an advantage given to the team that originally drafts a player, similar to what is done in the NBA.

    Have a short initial rookie contract, say 3 years, followed by “free agency”. However, once a player reaches free agency, the player should be incentivized to stay with the team that drafted them.

    If the player signs with a team that drafted them, the team can choose to offer a guaranteed contract, and not other team can offer that player a guaranteed deal. Other teams could sign the player after 3 years, but the contract would be non-guaranteed or performance-based. The drafting team could also offer a performance-based contract, but then they’d lose the advantage in retaining the player.

    I think most people would agree that it’s important to reward teams the draft well, especially if they are in a place like Jacksonville or Detroit that players wouldn’t always choose to go. But it’s also important to give players the chance to decide whether money, security, or winning is a priority for them.

    I don’t want a league full of guaranteed deals (many MLB and NBA teams have more than half their payroll taken up by players no longer nearly worth their salary), but introducing guaranteed deals as a way to shorten the rookie deal while still giving the drafting team an opportunity to keep the player seems fair. It would prevent team’s from stashing players like Aaron Rodgers on the bench, which would be a consequence of the PFT-proposed plan.

  30. thefiesty1 says: Feb 12, 2011 2:16 PM

    Anybody making over $300K a year is overpaid. They’re just not worth it.

  31. chwtom says: Feb 12, 2011 2:17 PM

    The problem with performance-based contracts is it incentivizes teams to restrict playing time of players (unless their team is close to playoff contention).

    If you initiate performance-based contracts, you have to remedy the issue of team’s sitting on players until they need them (to keep their salary down).

  32. packattack1967 says: Feb 12, 2011 2:21 PM

    Well thought out and really terrific solution. Remember players, the real issue here is not the rubles being shelled out necessarily (although that sucks), it’s the handcuffing effect a high dollar bust can have on a team. maybe YOUR TEAM! When the tides up all ships rise. Think the Packers free agents will get more looks this off season then the Panthers? Think about it.

  33. raz75reb says: Feb 12, 2011 2:32 PM

    The problem with that system part of the hype of the draft is knowing that the player drafted is going to be with your team for 4 or 5 years the day they’re drafted.

    A simple NBAesque salary slotting system is fine. Yes there are gonna be high picks that Oden. And yes there will be late picks that bust out. But that just comes with the territory.

    Slot the players and get them in camp.

  34. vicpetro says: Feb 12, 2011 2:36 PM

    I’d call it more of a step in the right direction than a solution. You have shortened the length of contracts which is great, but without some kind of slotting system you are still going to get unfair deals given to unproven players.

    If Sam Bradford signed a 6 yr/$78 million dollar contract, what’s to stop Andrew Luck from saying, “Bradford averaged $13 million a year. Now that only 2 years are guaranteed that should all be real money, so I want a 2 year/$28 million dollar contract that could reach 2/$32 million. After all $13 million a year was 2 years ago and I’m a better prospect than Bradford was.”

    So he’s still an unproven guy with $25+ million in the bank, and that’s still more than 80% of your “veteran leaders” he may or may not listen to.

  35. harmcityhomer says: Feb 12, 2011 3:35 PM

    As long as the contracts last more than 1 year they are not “rookie contracts” or really contracts at all when teams can break them but players can not.

    It is also easy to pick out some busts and say the system is broken, but if the Raiders had simply selected Calvin Johnson or Joe Thomas, would anyone be saying those guys are over paid? Bradford and Suh seem to be worth whatever they are making.

    I think the most fair solution both both sides is to stop pretending to be partners. Get rid of the draft all together and and let rookies sign real contracts with the highest bidder like most professionals coming out of college. How is that fair in the first place? The average player does not last as long as the “rookie contract” they should at least be able to sign with the team that offers them the most money or best opportunity.

    As long as there are roster limits there will be reasonable competitve balance. The NCAA has a lot less competitve balance than the NFL would, and that is a lot closer to what it would look like than MLB is. Even with over 100 D1 teams and 80 roster spots Alabama can lose to South Carolina and Michigan can lose to App state.

    There are a lot of ways to make the rules, but I do not see how any kind of draft or restricted free agency is fair. The only fair way for players to get what they are worth is to make teams compete to hire them from the start and let the market and supply vs demand rules sort out the value.

  36. lbijake says: Feb 12, 2011 5:24 PM

    The pay for a rookie should be the average of the top 17.5 players at that position within 2 1/2 standard deviations. Except for Oakland, let Al pay whatever the hell he wants. Call it the Trent Dilfer rule.

  37. jc1958cool says: Feb 12, 2011 5:40 PM

    why do people type a 4 paragraph letter to make a point! nobody reads it’s !!

  38. clownburger says: Feb 12, 2011 6:02 PM

    You HAVE to have a slotting system. And they need more than 2 years. 4 years is fair. It’s not like these guys will be making minimum wage for 4 years.

    Horrible idea by PFT.

  39. phuhcue says: Feb 12, 2011 6:17 PM

    My plan would be break down every position, and pay based on performance. as a QB, you Throw 0 interceptions and 40 TDs, you are the best in the league and you get top pay. You play like Romo and cost your team games, you get the league minimum, 425k a year. Provide everyone with an kick butt insurance plan, and go from there. at this level, every player ought to be elite in that they can make a difference in their teams performance.

  40. eb1212 says: Feb 12, 2011 9:50 PM

    take the franchise number for a position and multiply it by a factor based on draft spot. theres your salary

    50% for number one down to 15% for 32?

  41. goldsteel says: Feb 12, 2011 11:55 PM

    Rookie salaries are way too high. There has to be some structure in place so the league can remain solvent. These salaries cannot continue at the present rate of increase. The players must realize that they are part of the problem. It’s not just the owners.

  42. thenetrat says: Feb 13, 2011 2:36 AM

    By the way, I’ve been tweeting this for a week with zero replies with one exception, and agent said I blatantly misrepresenting the information (I have no idea what he meant).

  43. iffybiz says: Feb 17, 2011 10:27 AM

    There’s a better more simple solution. The problem isn’t rookie salaries per se. It’s signing bonuses.
    Create a rookie cap on signing bonuses or any bonus that would need to amortized over the length of the contract.
    If the bigger chunks of money were either in salary or roster bonuses, a rookie would have to earn the amounts he signed for or risk getting cut.
    The union should go for it because there would still be no “cap” on how much could be spent which is what they want because it drives up the veteran’s salaries (the rising tide idea).

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