termination pay

The Patriots, Marquice Cole, and Termination Pay

Posted on by Jason Fitzgerald

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Fans of the Patriots (or fans of those who scan the daily transactions around the NFL) have probably noticed a recurring pattern the last two weeks regarding CB Marquice Cole:

Cole is limited in practice all week

The Patriots release him before Sunday’s game

The following Week they re-sign Cole

Cole again does not practice

Cole is released again

And most likely we can keep repeating that until the season is over or Cole is healthy enough to actually play on Sunday.

What New England is doing is essentially using loopholes in the CBA to basically put Cole on their own version of IR with the designation to return while protecting their own financial interests. By waiting until the end of the week to release Cole, Cole receives his full salary, $42.058.82 per week, and will never miss a game check provided they continue re-signing him to a contract after Sunday’s game.

Termination pay is that guarantee everyone always talks about when a veteran player makes the week 1 roster. In Cole’s case he would be eligible to receive the balance of his $715,000 salary, which at the time of his first release was $546,765 and this week would be $504,706, once released. However, because Cole never misses a game check he is ineligible to claim Termination Pay following the season.

If New England did what many would think is the normal routine of releasing a player and then re-signing him when he is expected to contribute  the Patriots would have to pay Cole both the balance of his Termination Pay plus his salary on the new contract. So if they had released him outright last week and waited until week 8 to bring him back Cole could file a claim to receive his $546,765 and collect 8 weeks of salary on top of that amount. By releasing him after Tuesday the most he could have earned is the $546,765. This is why he will likely be back by next Wednesday and if he still can not play be released by Friday. If New England placed Cole on IR his season would be over, which they don’t want to have happen.

The risks for New England are minimal with this strategy. Cole does not need to clear waivers until after the trade deadline and its unlikely any team would sign him if he has a minor injury anyway, so there is a great chance that Cole is always going to re-sign with New England once asked. In fact it is probably agreed upon before the release that he will be back and not entertain offers from other teams. The team most likely will replace him with a Practice Squad player who will need to clear waivers once released, but considering the player has been free for any other team to sign off the Practice Squad anyway, waivers are not a concern. If a team wanted him that badly they would have made an offer before this time.

So it’s a small but neat little aspect of roster management going on in New England right now that ensures they have the players they want at the price they want for the remainder of the season.

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Veteran Players and Termination Pay

Posted on by Jason Fitzgerald

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I just read that the New York Jets released veteran Wide Receiver Braylon Edwards which reminded me about the factor that termination pay can be in deciding the fate of some players. Now I’m not sure if Edwards received any termination pay from his stint in San Francisco (I wouldn’t think he did since he was cut so late in the year, but I don’t know that for a fact though for the sake of argument we will assume it is fact), but I think his release is an example of the role that veteran status can sometimes have on roster management.

So what exactly is termination pay?  Termination pay is an in season salary guarantee that is automatically given to veteran players as a provision of the CBA. There are actually two types of termination pay. The primary one guarantees a players entire Paragraph 5 salary for the season. To be eligible you have to make the roster for the first game of the season and have not collected termination pay in the past. If released the team owes you the remainder of your salary for the year if the player puts in a claim for the amount. So if a player earns $1,700,000 in P5 salary, makes the team, and is cut after the first week the team still must pay him the $1.7 million. This termination pay does count in full towards the salary cap.

The second form of termination pay is for players signed during the season. In this case the player is only entitled to 25% of his proportionate salary for the season. For example if a player is signed in week 2 at a rate of $1,700,000 (meaning he would earn $1.6 million if he is on the team the next 16 weeks) he is only eligible to collect a total of $400,000 under the termination pay clause.  Considering he earns $100,000 per week he could be released after four weeks with no additional damage done to your salary cap.

The one thing that teams want the most of during the season is roster flexibility. Sure there are plenty of players locked in, but those last 10 to 15 guys are by no means assured of anything. If you choose to bring a veteran onto the initial 53 man roster that is termination pay eligible and you think he is in those last 10 to 15 players on the roster following training camp, well you have now damaged your roster flexibility because you can’t remove his cap charge from the team. So in a sense you can box yourself in by keeping a veteran who may be the best option on September 1 but likely will not be on October 1.

So for players like Edwards they may get released only to be called back up at a later date when the second form of termination pay kicks in. At this point a teams flexibility is not compromised due to the termination pay. A GM like the Jets’ John Idzik, who comes from a system in Seattle that during their rebuild were constantly moving pieces from the roster, is probably less inclined than many to keep players like Edwards. Edwards also has an injury history that popped up again this summer which can make the team think he is going to be a week to week player essentially on a guaranteed contract.

Just another small but important aspect to consider when you hear about your team cutting a veteran. Some of them may be back sooner rather than later, but the rules make it difficult for end of career veterans who will likely be backups to start the year on the active roster of many teams whose outlook is brighter in the future than in the current year.

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