Guaranteed contracts for NFL players would lead to shorter contracts

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The annual NBA free agency period has renewed calls for fully-guaranteed contracts in the NFL. So let’s dust off concepts I’ve probably articulated in the past, but am too lazy or ill-equipped to locate.

Before doing that, remember this:  One finite slice of NFL contracts has become fully or mostly guaranteed. Specifically, the deals given to all first-round draft picks carry millions each year in guaranteed pay. For the first 20 or so players who are picked, every penny of the four-year contract is fully guaranteed at signing.

Beyond that, players and teams are free to negotiate guaranteed pay for all or part of a contract. The best players routinely get full guarantees for two or three years at the most. If, as a practical matter, the NFL were ever to commit to fully-guaranteed contracts on an across-the-board basis, few contracts would be longer than two or three years in duration.

Currently, it makes little sense for players to commit beyond two or three years. In the later, non-guaranteed years of the deal, the team has the ability to tear up the contract or to squeeze the player to take less. So if the team doesn’t leverage the player to take less (or flat-out dump him), it’s fair to conclude that the team regards the balance of the contract as a very good one for the organization — and necessarily not a good one for the player.

So, basically, the adoption of fully-guaranteed contracts for all NFL players would result in, for most players, shorter contracts. Which would be good for players not only because they’d be getting guaranteed contracts but also because they’d have more opportunities to push their way to the open market.

Here’s another problem with long-term fully-guaranteed contracts in the NFL. With a salary cap firmly in place, teams would be required to continue to devote space to players who are no longer deemed to be worth the investment, at the expense of other players who are viewed as being in a better position to thrive. It’s another reason why teams would push for short-term deals, if forced to guarantee the full duration of each contract.

Then there’s the funding issue, which started as a shield for players but eventually became a sword for the teams. Due to concerns about cash flow and liquidity, the NFL Players Association insisted years ago on payment into escrow of fully-guaranteed amounts, so that the money would be available when the player is due to receive it. Cash flow and liquidity are no longer concerns in the modern NFL, but teams routinely refuse to commit large future sums on a fully-guaranteed basis because of the outdated funding rule.

Could some players currently secure deals that include significant guarantees in future years? Yes, with franchise quarterbacks (who tend to both stay healthy and continue to be franchise quarterbacks) leading the way.

To date, the closest any veteran player has come to a fully-guaranteed contract beyond three years was Dolphins defensive tackle Ndamukong Suh, whose fully-guaranteed $60 million over the first three years includes rolling guarantees in 2018, 2019, and 2020 that vest if he’s on the roster on the first day of each league year. It means that he’ll either get the money in 2018, 2019, and 2020, or he’ll get a ticket to the market at a time when the market still has real money in it.

If the Dolphins had been required to fully-guarantee all six years of the contract, chances are that it wouldn’t have been a six-year deal.

With football being the ultimate meritocracy, a system that encourages shorter-term deals may be the best outcome for players who hope to parlay merit into pay. Regardless, that’s the most likely consequence of fully-guaranteed contracts — shorter deals and, in turn, more opportunities for players to sign new ones.

27 responses to “Guaranteed contracts for NFL players would lead to shorter contracts

  1. No DUH! Of course the contracts would be shorter, the length of the contract now is entirely to the benefit of the team! They hold all the cards. The NFLPA is the most gutless, pathetic union in pro sports – look at how they let their players get railroaded, even their biggest stars.

  2. There’s also a couple more ripple effects. One, the cap management would be a logistical nightmare with the sheer number of players becoming free agents on an annual basis. But besides that, with shorter deals and more quality likely reaching free agency, you may create an NBA situation where you a) have the potential to create “Super-teams” with a band of free agents selecting a single team to load up on premier talent if they have the available cap space and b) the teams who lose out in free agency end up having to spend their excess cap space on mediocre talent and they will tank in an effort to secure higher draft positioning.

    What I personally would like to see as a trade off would be a system more similar to the MLB. They also feature guaranteed contracts for free agents. I would propose that when a player is drafted or signed as an UDFA, their rights belong to that team for 6 years. Rookie contracts are three years in length, fully guaranteed for everyone. After three years, each of the next three years the team and player enter into an arbitration process (each side submits a number for the following year, and if they cannot meet in the middle an independent arbitrator picks one side). The team and player are also free to enter into a multi-year agreement to bypass some or all of their arbitration-eligible years, which is very common for superstars in MLB. There would be a deadline before the arbitration process (before free agency) where the team could non-tender the player (renouncing their rights) and the player becomes a regular free agent. I think this situation gives the players what they want (guaranteed money) while also protecting the teams who draft well by keeping star players for a bit longer, which would help keep roster turnover more manageable.

  3. Might as well go all in with a draft lottery that will lead to lottery protected trades of 1st round picks which will lead to teams drafting a player on behalf of other teams which will lead to players walking on stage to meet the commissioner and hold up a jersey of the team that drafted them despite everyone knowing that they are being traded later in the evening.

    On top of that we will be subjected to sign and trade deals and in all probability to smaller roster sizes. Futures deals will be out and fringe players will be held onto rather than being released due to salary guarantees which gives will deny other players the chance to make their mark during the season.

  4. Guaranteed contracts would ruin the NFL. There is no incentive to perform is every penny is guaranteed and you get millions and millions so you’re set for life.

  5. The NFL is a brutal sport and the teams fear that too many players would take the money and run.

    When the Lions let FA LB Chris Spielman walk (Bills), they signed Giants LB Michael Brooks to replace him. I was hopeful because Brooks was a good player, and faster that Spielman, but he just mailed it in and was cut in preseason. He had signed a 3 year, $9 million contract with $3 mil guaranteed. He took that $3 mil as a parting gift from the NFL and never played again.

  6. I think that is a false assumption. Teams who want greater consistency would sign consistent players (Ex: a B- offensive lineman) to longer contracts, as QBs tend to do better with consistent O-lines, and lines play better when they have been around together for a while.

    The league and union could also add mandatory minimums years to contracts, while capping them monetarily.

    Injury problems could be solved by not counting long-term injuries requiring surgery against the cap.

    Baseball is the only sport with a truly capitalist contract situation, and that has plenty of long-term contracts. It also has a much higher injury severity rate than the NBA due to all the arm injuries.

  7. harrisonhits2 says:
    Jul 8, 2017 9:51 AM
    Guaranteed contracts would ruin the NFL. There is no incentive to perform is every penny is guaranteed and you get millions and millions so you’re set for life.
    ———-

    You’re right. That’s why hockey is so terrible. Just a bunch of fat happy guys skating around doing nothing because of their guaranteed contracts.

  8. Reluctant to see much change because belichick has been able to exploit the stupidity of opponent management under current system. Who knows though, they may do even dumber deals with shorter contracts.

  9. I feel so bad for the players! if only there was something in place that gave them a boatload of guaranteed money up front when signing their contracts. someone should come up with a way that guarantees them millions just for signing their names just in case they do not make the team during the length of of the deal the system is just so unfair the way it is now.

  10. NFL contracts should be fully guaranteed (or close to it) for INJURY. There should absolutely not be full guarantees for performance. That is the NBA’s problem. If a team makes a bad decision on a player and gives them a 4-5 year deal, they are stuck paying for garbage for that entire time, and it cripples a team’s ability to get better.

    Contracts should be guaranteed for injury, and in the event of serious injuries that will cause the player to miss future season(s) (i.e. Teddy Bridgewater), the payment shouldn’t count against the cap. This way teams can still be competitive and the injured player gets paid.

  11. As long as players get 48% of the league revenue as per CBA, I don’t care WHICH players share it.

    However, under a fully guaranteed contract system, you’ll have underperforming/injured players stuck on the team for years because of their contract, while some great, young talent can’t be signed because that vet is taking the roster spot.

  12. akira1971 says:

    As long as players get 48% of the league revenue as per CBA, I don’t care WHICH players share it.
    ————–

    To add, think of all the great players. At one point, they replaced a highly-paid veteran because the team wasn’t forced to keep an underperforming player due to guaranteed contracts.

    Same here, a young star will one day replace Suh, Brees, Watt, etc.

  13. ibillwt says:
    Jul 8, 2017 10:35 AM

    Reluctant to see much change because belichick has been able to exploit the stupidity of opponent management under current system. Who knows though, they may do even dumber deals with shorter contracts.
    _____________________

    Wait until Shady retires or gets seriously injured (if the refs allow defenders to do more than just breathe on him without a penalty). You’ll see exactly how brilliant belicheat is.

  14. The NHL system is a lot more simple. Guaranteed contracts, the average is the cap hit, player doesn’t count against the cap if they are on long term IR, and buyouts mean half the cap hit for twice the length.

  15. Every time a subject like this comes up, lots of people start accusing the NFL taking advantage of the players. And every time something likes this comes up, I’m just shocked at the representation (or non-representation) the players are receiving from their union. NFL football is the greatest source of entertainment in the world. There’s nothing quite like it. Seems like everyone is playing fantasy football these days, and the league is setting new records for revenue every year. The only thing that seems amateur about the whole industry is the players union. I’m sure the owners are just as shocked as I am. It’s like taking candy from a baby. I guess it’s just that most groups of millionaires are very well educated and capable of looking out for their own best interest. Most pro athletes only went to school to play sports. It’s pretty sad. It’s like nobody is looking out for these players.

  16. ATTENTION NFLPA!!!

    Here is your bargaining chip in the next CBA negotiations:

    “Then there’s the funding issue, which started as a shield for players but eventually became a sword for the teams. ”

    This seems like something the players could give up in exchange for, oh, I don’t know, how about MARIJUANA coming off the list of banned substances?? Or Goodell no longer having sole discretion over player discipline?

    **This could be a HUGE bargaining chip for the players! Good job for bringing this up, PFT!**

  17. They could lose every penny while sucking the other teams into bankruptcy via revenue sharing. Always amazed when sports media advocate changes that would bring about mediocrity and eventual league failure. Like the scorpion who asks the frog for a ride across the pond. Or BLM who wants all police to disappear. LOL

  18. “It’s like nobody is looking out for these players.” — Remember the Strike? The NFL will NEVER be at the mercy of the players. There’s a reason new junior/developmental leagues pop up every decade. Because there will ALWAYS be replacement players willing to make what current players scoff at now. Or even a fraction of it. The NBA relies on 1-2 superstars per team. The NFL has 53 great players per team. And great coaches. And only 16 games, where everyone team has a reasonable chance to win a Championship. Even the Browns.

  19. tonebones says:
    Jul 8, 2017 3:48 PM
    Every time a subject like this comes up, lots of people start accusing the NFL taking advantage of the players. And every time something likes this comes up, I’m just shocked at the representation (or non-representation) the players are receiving from their union. NFL football is the greatest source of entertainment in the world. There’s nothing quite like it. Seems like everyone is playing fantasy football these days, and the league is setting new records for revenue every year. The only thing that seems amateur about the whole industry is the players union. I’m sure the owners are just as shocked as I am. It’s like taking candy from a baby. I guess it’s just that most groups of millionaires are very well educated and capable of looking out for their own best interest. Most pro athletes only went to school to play sports. It’s pretty sad. It’s like nobody is looking out for these players.

    =============
    good point on the union, however nfl has started to jump shark for most. even ffl is starting to decline.
    they are eating their own.

  20. NFL regular season is the best because contracts are not guaranteed. It would make it like the NBA when players won’t play hard. Keep as is, just the players should get a bigger piece of the revenue.

  21. yeah the nflpa should maybe look into hiring people who actually went to school for such jobs instead of hiring former players.

    gotta think there are at least ten thousand people more qualified than “eric winston.”

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