Rookie Compensation and Rookie Compensation Pool
Section 3Rookie Contracts
Contract Length. Every Rookie Contract shall have a fixed and unalterable contract length: (i) four years for Rookies selected in the first round of the Draft, with a Club option for a fifth year as described in Section 7 below; (ii) four years for Rookies selected in rounds two through seven of the Draft (including any compensatory draft selections); and (iii) three years for Undrafted Rookies.
Subject to Subsection (iv) below, Rookies drafted in the first round may contract for only the following types of compensation: (1) Rookie Salary, (2) minimum offseason workout per diem commencing in the contract’s second season; and (3) the Fifth-Year Option as described in Section 7 below. Rookies drafted in the second through seventh rounds may contract for only the following types of compensation: (1) Rookie Salary, (2) minimum offseason workout per diem commencing in the contract’s second season; and (3) the Proven Performance Escalator as described in Section 4 below. (ii) Subject to Subsection (iv) below, Undrafted Rookies may contract for only the following types of compensation: (1) Rookie Salary, (2) minimum offseason workout per diem commencing in the contract’s second season, and (3) the applicable Minimum Salary for players on the Club’s Active/Inactive List Salary and/or the applicable Minimum Salary for players not on the Club’s Active/Inactive List.
Rookie Salary shall include only: (1) traditional signing bonus, defined as signing bonus committed to the player by the Club upon execution of the contract (subject to the player reporting to the Club and passing the physical examination), subject to any forfeiture provisions to which the player and Club may agree to the extent permitted in Article 4; (2) offseason workout bonus; (3) Paragraph 5 Salary (including any agreed-upon provisions adjusting the player’s Paragraph 5 Salary based upon his roster status and/or his number of Credited Seasons (“split contract provisions”) or deferring payment of his earned Paragraph 5 Salary or advancing payment of non-guaranteed year-one Paragraph 5 Salary); (4) Paragraph 5 Salary guarantees (subject to the rules set forth in Subsection (h) below); (5) the permitted performance incentives set forth in Section 6 below; (6) roster bonus; and (7) reporting bonus.
Other Permissible Terms.
All Rookie Contracts shall use the standard-form Player Contract described in Article 4 and set forth in Appendix A of this Agreement and may contain minimum offseason workout per diem commencing in the contract’s second season. Rookie Contracts for players drafted in round one shall contain the Fifth-Year Option described in Section 7 below. Rookie Contracts for players drafted in rounds two through seven shall contain the Proven Performance Escalator described in Section 4 below. A Rookie Contract may also contain non-compensation terms relating to: (1) player appearances/promotions; (2) workers’ compensation issues; (3) waivers of Club liability for preexisting injuries/physical conditions; (4) forfeiture of compensation and/or of guarantees to the extent permitted in Article 4; (5) deduction or repayment of advanced nonguaranteed year-one Paragraph 5 Salary; (6) insurance policies; (7) tax implications; (8) confidentiality (subject to Article 26); (9) the severability of unenforceable contract terms; (10) legal/contractual interpretation issues; (11) representations and warranties that at the time the contract is executed, no circumstances exist that would prevent the player’s continuing availability to the Club for the duration of the contract; (12) waiver of a Club’s right to enforce any of the terms of Paragraph 3 of the NFL Player Contract; and (13) waiver of a Club’s rights regarding the designations of, or the Required Tender amounts for, Franchise or Transition Players. With the sole exception of the compensation terms that appear in Subsection (b) above, the other permissible terms that appear in this Subsection, and, if applicable, the Proven Performance Escalator in Section 4 and the FifthYear Option in Section 7 of this Article, any other contract terms will be deemed null and void ab initio unless the parties to this Agreement agree otherwise.
Without limitation on any other operation or interpretation of Section 3(c) of this Article (Other Permissible Terms), any Rookie Contracts executed on or after April 24, 2018 may not contain any individually negotiated provision that:
grants a Club the unilateral right to convert any form of Salary to signing bonus (i.e., “automatic conversion” provisions are prohibited);
conditions a player’s entitlement to earn any performance incentive described in Section 6 of this Article (Performance Incentives) upon (i) being in a particular roster category (e.g., Active/Inactive, Reserve/Injured, etc.) on any particular date; or (ii) the applicability or priority of statistical sources listed or enumerated in the contract provision;
prohibits a player from performing services for any other team or in any other sport (i.e., “exclusive services” provisions are prohibited);
prohibits a player from engaging in conduct that would constitute a violation of the NFL Anti-Tampering Policy by any NFL Club; or
conditions the formation and binding effect of a player’s Rookie Contract upon his ability to pass a physical examination administered by the Club Physician; provided, however, that nothing shall prohibit a Club and a player from agreeing that the player’s entitlement to receive a signing bonus is subject to the player reporting to the Club and passing a physical examination.
The NFLMC will provide Clubs with the sample language set forth below, which Clubs may individually negotiate with players for inclusion in Rookie Contracts, and which the NFLPA agrees that it would not challenge if such language is included without modification or addition in a Rookie Contract; and Clubs and players remain free to negotiate other CBA-compliant language, but the NFLPA reserves its position that no other language would comply with this Agreement, and the NFLMC and the NFLPA reserve their respective rights concerning the enforceability of any other non-compensation terms in such contracts:
Deduction and Setoff: In addition to any other deductions permitted by the NFL Collective Bargaining Agreement and this Contract, Player hereby expressly authorizes and directs Club to deduct from any payment coming due to Player under this Contract all or any part of: (i) any advance of non-guaranteed year-one Paragraph 5 Salary made to Player; and (ii) any charges incurred by Player for goods and services provided by Club, e.g., without limitation game tickets, mail services, and any similar items. Player shall provide Club with written notice (email to the Club’s payroll department shall suffice) of any dispute regarding such charges, which shall be resolved within three business days. The assignment and/or termination of Player’s Contract shall not result in waiver of Club’s right to seek to recover the full amount of any such advanced salary or reimbursement for such goods or services;
Marketing and Endorsements: Player acknowledges that Club has significant relationships with sponsors and media partners. Player shall work and cooperate with Club to support and enhance those relationships as provided herein, and shall participate in media and sponsorship activities as follows:
Player and Club agree to work with one another in good faith, as reasonably requested by Club, with respect to Club media and marketing activities and, where Player reasonably determines it is appropriate and possible to do so, Player agrees to use all reasonable efforts to pursue media and marketing relationships with Club’s sponsors and media partners;
Player shall also, in cooperation with Club, use all reasonable efforts to pursue media and marketing agreements with Club sponsors and media partners, before commencing negotiations with any competitor of any Club sponsor or media partner. If Player does not reach a mutually acceptable commercial agreement with a Club sponsor or media partner after engaging in good faith negotiations to reach such an agreement, or such negotiations are determined in good faith to be futile, Player shall notify the Club, and shall thereafter be free to commence negotiations and reach agreements with competitors of the applicable Club sponsors or media partners;
Player agrees not to engage in any sponsorship or endorsement activity, other than through Club, that would reasonably imply Club’s sponsorship, approval or involvement, including by way of example, any use of any of Club’s names, marks, logos, uniform designs or symbols;
Player agrees to provide Club with the name and contact information of his Primary Marketing Representative and to keep the Club up to date with respect to any changes to his marketing representation;
This paragraph (B) shall have no application to any current sponsorship, promotion, media or endorsement agreement of Player already in effect as of the date of this Contract, or as of the date of any assignment of this Player Contract by trade or waiver to another Club;
In no event shall Player be obligated pursuant to this paragraph to engage in any marketing or media activity that Player reasonably determines is not in his best interests; provided, however, that player shall participate in all other marketing or media activities, as provided herein, as reasonably requested by Club;
Player’s obligations hereunder shall be subject to the provisions of the NFLPA Group Licensing Program; and
The rights granted to Club under this paragraph are incremental to and shall not be construed to limit any other rights granted to Club under this Contract.
Physical Examinations: Player agrees to undergo any physical examination requested in good faith by the Club Physician in connection with: (i) the treatment or rehabilitation of any football-related injury or any non-football-related injury or illness; or (ii) the purchase of any policy of insurance by club, the NFL, or Player to cover Player’s inability to perform services required by his Player Contract, or any claim filed with the carrier under such policy;
Medical Information and Treatment: Player represents to Club that he is and will maintain himself in excellent physical condition. Player will undergo a complete physical examination by the Club Physician upon Club request, during which physical examination Player agrees to make full and complete disclosure of any physical or mental condition known to him which might impair his performance under this Contract and to respond fully and in good faith when questioned by the Club Physician about such condition; and
Representations and Warranties: By executing this Contract, Player hereby represents and warrants that, as of the date hereof, no circumstances exist that would prevent Player’s continuing availability to the Club for the duration of this Contract, except as otherwise disclosed to Club in writing.
Nothing in Subsections 3(c)(ii) or (iii) of this Article will add to, subtract from, or alter in any way the terms of the standard NFL Player Contract.
Reasonably prior to the initiation of a grievance or proceeding alleging a violation of Subsection 3(c) of this Article, the NFLMC and the NFLPA shall confer in person or by telephone to attempt to negotiate a resolution of the dispute.
With respect to Rookie Contracts executed prior to April 24, 2018, (i) any non-compensation term that is prohibited by Section 3(c)(ii) of this Article shall be deemed null and void ab initio; and (ii) the NFLMC and the NFLPA reserve their respective rights concerning the enforceability of any other non-compensation term in such contracts.
In any proceeding regarding the enforceability of any non-compensation term other than the terms that are alleged to be prohibited by Subsection 3(c)(ii), or authorized by Subsection 3(c)(iii), such provisions (i.e., Subsections 3(c)(ii) and (iii)) may not be referenced in any way in support of or in opposition to any argument that a non-compensation term is prohibited or authorized by Article 7, Section 3(c).
Prohibited Terms. The following contract provisions are prohibited in a Rookie Contract: option bonuses, option exercise fees, option nonexercise fees, Salary advances (other than advances of non-guaranteed year-one Paragraph 5 Salary as described in Subsection (b)(iii)(3) above), voidable year(s) provisions, buybacks of voidable year(s) provisions, and any “contract within the contract” (i.e., terms and conditions of a contemplated superseding contract within the Rookie Contract).
25% Increase Rule. No Rookie Contract may provide for an annual increase of more than 25% of the player’s Year-One Rookie Salary unless such contract provides only for Paragraph 5 Salary equal to the then-applicable Minimum Active/Inactive Salary for each League Year of the Contract. By way of example, if a player drafted in the second round signs a four-year contract with a $400,000 signing bonus, a $500,000 Paragraph 5 Salary, and no performance incentives in his first season, the player’s YearOne Rookie Salary will equal $600,000, i.e., the prorated portion of his signing bonus ($100,000) plus his Paragraph 5 Salary ($500,000). Accordingly, the player’s maximum annual increase in Rookie Salary may not exceed $150,000 ($600,000 × 25%).
All Salary Included in Calculations. All Rookie Salary shall count toward the Total Rookie Compensation Pool, the Year-One Rookie Compensation Pool, the Club’s Year-One Rookie Allocation, the Club’s Total Rookie Allocation, and the 25% Increase Rule.
Signing Bonus Proration. The total amount of any signing bonus, or amount treated as signing bonus, shall be prorated over the term of the Rookie Contract, with a maximum proration of four years, on a straight-line basis beginning in the first year of the player’s contract, such that each contract year (excluding year five for players selected in round one of the draft) shall have an equal prorated amount, and such equal prorated amount shall count in the calculation of Rookie Salary and against the Total Rookie Compensation Pool for that Draft class and the Club’s Total Rookie Allocation in each League Year of the contract. The amount prorated in the player’s first contract year shall count in the calculation of Year-One Rookie Salary and against the Year-One Rookie Compensation Pool for that Draft class and the Club’s Year-One Rookie Allocation.
Guaranteed Rookie Salary. Rookie Salary (excluding the performance incentives described in Section 6 below) may be guaranteed for skill, football-related injury and/or Salary Cap-related contract terminations, provided, however, that no player’s Rookie Salary (excluding performance incentives) in his third League Year or fourth League Year (for Drafted Rookies) may be guaranteed for skill, football-related injury or Salary Cap-related contract termination unless the player’s entire Rookie Salary (excluding performance incentives) has been similarly guaranteed (i.e., for the same type(s) of contract termination) in the immediately preceding year of the contract. By way of example, if a Drafted Rookie signs a four-year contract with Rookie Salary (excluding performance incentives) of $1,000,000 in year one, $1,250,000 in year two, $1,500,000 in year three, and $1,750,000 in year four, no portion of his year-four Rookie Salary may be guaranteed for skill and injury unless the player’s full Rookie Salary (excluding performance incentives) for year two ($1,250,000) and year three ($1,500,000) is also guaranteed for skill and injury. For the avoidance of doubt, and by way of further example, a Club may guarantee yearfour Rookie Salary for injury only when the Club also guarantees years two and three either just for injury, or for injury, skill, and Salary Cap-related termination.
A player’s Rookie Salary, as well as all other mandatory or permissible contract terms (including, but not limited to, length of the contract and Salary guarantees), may not change based upon any contingency (e.g., without limitation, roster condition, offseason workout participation, playtime, honors, team or individual performance, the player’s earning or not earning specific compensation, or the Club’s decision to forgo the exercise of any contract rights). By way of example, if the player fails to earn a $100,000 incentive applicable to the second year of his contract, the unearned amount cannot be added to a $100,000 incentive applicable to the third year of his contract, thereby resulting in a $200,000 incentive.
Without limitation on any other operation or interpretation of this Subsection 3(i), no Rookie Contract may contain any provision that: (1) any workout bonus is contingent upon the player participating in any minicamps and/or mandatory minicamps, timely reporting to training camp, and/or being on the roster at the start and/or end of the offseason workout program or on any particular date(s); (2) any roster bonus is contingent upon the player participating in any minicamps and/or mandatory minicamps, timely reporting to training camp, and/or completion of or any participation in the club’s offseason workout program; and/or (3) any reporting bonus is contingent upon the player participating in any minicamps and/or mandatory minicamp, completion of or any participation in the club’s offseason workout program, and/or being on the Club’s roster at the start and/or end of the offseason workout program or on any particular date(s). The preceding prohibition applies regardless of the League Year in which the bonus and/or any contingency applies, and whether the bonus and any contingency are in the same League Year or different League Years. The Commissioner shall disapprove pursuant to Subsection 2(j) above and Article 4, Section 6 of this Agreement, any Rookie Contract including any such provision.
Nothing in this Article is intended to limit the right of a Club and player to agree to circumstances in which roster, or reporting bonuses may be forfeitable in accordance with Article 4, Section 9, nor is anything in this Article is intended to limit provisions for Player Contracts other than Rookie Contracts. For the avoidance of doubt, nothing in this Article is intended to prohibit Clubs and players from agreeing to (1) the workout conditions that must be satisfied for a player to earn a workout bonus (e.g., percentage of workouts, etc.), (2) the roster condition and date that must be satisfied for a player to earn a roster bonus (e.g., Active/Inactive roster on the first day of the regular season), or (3) the date and time by which the player must report to the Club to earn a reporting bonus (e.g., timely reports to the first day of preseason training camp).
Aside from the terms outlined in Subsections (i) through (iii), above, no cash or non-cash financial or economic consideration of any kind (e.g., suites, automobiles, loans, etc.) may be paid or promised to the player for any reason whatsoever including, but not limited to, the player’s performance of nonfootball-related services with the exception of an agreement that the player will make up to, but no more than, five community relations/sponsor appearances or promotional activities per year on the Club’s behalf in exchange for cash compensation at prevailing commercial rates not to exceed $6,500 per appearance for the 2020-25 League Years, and not to exceed $9,000 per appearance for the 2026-30 League Years. In addition, whether or not the Club elects to provide the player with cash compensation for any individual appearance, to the extent the player incurs out-of-pocket expenses (e.g., parking fees, etc.) in connection with such appearance, the Club may provide the player with cash reimbursement for such reasonable out-of-pocket expenses upon the player’s submission of a written expense report satisfactory to Club and applicable receipts. The Club may also provide the player with cash reimbursement for actual mileage incurred, as approved by the Club, at the standard mileage rate in effect for the applicable period as published by the Internal Revenue Service. Clubs may not contract for, or require the player to make more than five community relations/sponsor appearances or promotional activities per year.
For any Rookie Contract executed during the term of this Agreement, the player and the Club may agree to include a provision governing player appearances in the Rookie Contract at the time of its execution by the parties; or if the player and the Club do not elect to include a provision governing player appearances at the time of the contract’s execution, any player appearances made by the player under his Rookie Contract shall be deemed to have been made under Appendix R to this Agreement.
Release or Trade of Drafted Rookies. (i) If a Drafted Rookie is released prior to signing a Player Contract (i.e., the Club withdraws its Tender), the Club’s YearOne Rookie Allocation will be reduced by the released player’s Year-One Minimum Allotment multiplied by the Year-One Rookie Compensation Pool. In the event that a Draft selection (i.e., a draft slot) is assigned to another Club prior to completion of the Draft, the amount of the Year-One Formula Allotment for such selection shall be assigned to the Club receiving the selection. A Club may not assign the exclusive negotiating rights to a Drafted Rookie to another Club if such new Club does not have Room under its YearOne Rookie Allocation equal to at least the original Year-One Minimum Allotment for the player multiplied by the Year-One Rookie Compensation Pool. The New Club will not receive any additional Room in its Year-One Rookie Allocation or Total Rookie Allocation.
If a Drafted Rookie is released by the drafting Club after signing his initial contract and such player re-signs with the same Club at any point during the League Year in which he was drafted, the signing Club may not enter into a contract with the player for more than the Year-One Rookie Salary set forth in the first year of the player’s initial contract with the Club, less any amounts the player earned under his initial contract before his release, and the player’s Contract cannot provide for an annual increase in Salary (as defined in Article 13) of more than 25% of the Year-One Rookie Salary in his initial Rookie Contract.
A Rookie Contract for a Drafted Rookie may not be renegotiated, amended or altered in any way until after the final regular season game of the player’s third contract year.
A Rookie Contract for an Undrafted Rookie may not be renegotiated, amended or altered in any way until after the final regular season game of the player’s second contract year.
For the avoidance of doubt, any permissible renegotiated or extended Player Contract shall not be considered a Rookie Contract, and shall not be subject to the rules that limit Rookie Contracts.