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Mar 04

An Overview of the Various Types of Free Agents

I tend to think most people are familiar with the various definitions and terms that come up during free agency, but I figured what harm would it be to do a small post explaining the various types of free agents that we come across over the next few weeks.

Unrestricted Free Agents (UFA)

This is the group of free agents who have spent at least 4 years in the NFL and whose contracts have run out, either due to time or void clauses. UFAs are free to sign with anyone in the league starting on March 12 when the new League Year begins. Prior to March 12 they can only re-sign with the team they played for last season. On March 9 they can officially begin to negotiate with other teams but nothing can be signed until the 12th. This represents a 3 day bargaining window where a player can get a good idea of his market value and bring it back to his original team to try to match or exceed to lock him up before free agency begins.

For the most part a player who will become a UFA is more or less completely free with a few exceptions. The big exception is the Franchise Player designation which we will get to in a moment. There are also rules that limit the signing period of these players to the start of training camp. If a UFA does not sign by that date and his former team tenders him an offer at 110% of his prior years salary by June 1st his old team maintains exclusive negotiating rights with the player for the remainder of the season. This is a rare occurrence but can occasionally happen. If such a tender is made the player will begin to count towards the salary cap on July 15th even if the offer is not signed.

Players designated as UFAs all factor into the equation that the league uses to award compensatory picks in the following years NFL draft.

Franchise Player

A franchise player is a specific type of UFA (or Restricted Free Agent) who has his rights severely limited by his former team. Each team can designate one franchise player per year. The offer is a one year fully guaranteed contract at a figure calculated by the NFL based on a percentage of cap and position played. The  non-exclusive tender still allows the player to negotiate with other teams until the tender is signed, however if the player signs with another team his former team has the option of either matching the offer or receiving two first round draft selections as compensation. The steep price tag rarely makes another team waste their time negotiating with a franchise player. The actual price of the non-exclusive franchise player grows depending on the amount of times he is tagged, maxing out at 144% of Prior Year compensation or the franchise salary of a QB, whichever is greater. If tagged a third time you are blocked from negotiating with another team. The exclusive franchise player designation is an average of the 5 highest salaries at a position in a given year and completely blocks a player from entering free agency.

The franchise player has until July 15th to sign a multi year contract with his former team. After that point he may only accept the franchise tender for the season. The tender immediately counts towards the salary cap once the offer is made to the player even if the deal is unsigned, however there are no guarantees until the offer is actually signed.

Transition Player

The transition tag is a lower cost and much lesser used mechanism in free agency. A team that does not designate a franchise player may designate a transition player in its place. The cost of the tag is the average of the 10 largest cap hits (minus workout payments and incentives) at a given position and like the franchise tag is fully guaranteed when signed. The teams receive no draft pick compensation if a transition player is signed to a deal with another team but they do have the right to match the offer sheet. The tender once made immediately counts towards the salary cap.

 Other/Street Free Agent (OFA)

I think often we are all guilty of lumping these players in with the UFA category. Other free agents are players who had their contracts terminated by the prior club or simply were not on a roster at the end of the prior League Year. All of the players who are released fall into this subset. They can sign new contracts with another team prior to March 12 as they are completely free once their contract was terminated. Such players do not count into the compensatory draft equations.

Restricted Free Agent (RFA)

RFAs are players with 3 years of NFL service whose rights are still to some extent controlled by their former team. The new CBA limits RFA’s to players who signed as undrafted free agents or were drafted and subsequently waived from their  4 year contracts or injured. For the most part teams had eliminated drafted rookies even under the old CBA from this process though some teams such as the Steelers and Packers would only sign late round selections to 3 year deals and allow them to become RFA’s.

There are 4 RFA designations, each with a different price tag and a different compensation package. Unlike the franchise and transition contracts these contracts are not fully guaranteed. The price of the tags range from $1.323 million to $2,879 million in 2013. The highest price tag gives the prior team the right to receive a teams’ 1st round draft pick as compensation if they choose not to match the offer. The mid cost grade gives the team a 2nd round pick while the final ones give the team the ability to receive compensation at the player original draft round and/or the right to simply match the offer sheet.

Because of the draft pick compensation it is rare that a RFA signs with another team. Teams have the ability to name as many RFAs as they want and RFAs only have about a month to find a new team. Once that period passes they can only sign a deal with their old team. If they fail to sign by June 15th they may be in a position to see their salary offer reduced while the team still maintains exclusive rights. RFA tenders once made immediately count on the salary cap so if you see reports of cap space diminishing and cant find a corresponding transaction there is a good chance a player was tendered that we don’t know about.

Exclusive Rights Free Agent (ERFA)

I’m not even sure why these players are called free. These are the players with 2 or less seasons in the league, a status reserved almost solely for undrafted rookie type players. Once tendered they can only negotiate with their former team. The tender offer is only a one year non-guaranteed contract at the minimum salary level so most teams would use the ERFA designation on players who were on the roster late in the prior year and signed to a 1 year deal.   Usually these offers are signed as soon as they are made since nothing is gained by waiting.