Training camps are starting this week, and in their leadup we have seen multiple stories of some players deeming to be underpaid (Zack Martin, Chris Jones) and others deemed to be overpaid by their teams (Joe Mixon, Kevin Byard). This was leading me to consider a concept I’ll call contract fate, the outcome of multiyear contracts signed by vested veterans.
To gather the data required to measure contract fate, I took a look at all inactive contracts in OTC’s database of two or more seasons in length that were signed since 2011 where the starting year of the new contract took place when the player became a vested veteran, meaning that the player would accrue four or more seasons by that season. A little more than 2,000 contracts over this 12 to 13 year span were considered. Contracts were classified into five buckets:
- Terminated: the team cut the player before his contract expired
- Pay Cut: the team and player renegotiated to an Average Per Year (APY) that was lower than the APY of the original contract.
- Expired: the entirety of the contract was executed.
- Pay Raise: the team and player renegotiated to an APY that was higher than the APY of the original contract.
- Extension: the existing contract was deemed to be extended in OTC’s database.
The first two contract fates are deemed to be negative for the player, the final two deemed to be positive for the player, while expiring contracts are deemed to be a fair fate for both the player and team.
Contract Fate By Length
|Length||Terminated||Pay Cut||Expired||Pay Raise||Extended|
Even with players who only sign for two seasons, it’s a coin flip as to whether the team will agree to see the second half of that contract out on its original terms. For three or more seasons, the odds rise to 70% that the team will not approve of the terms of the contract at some point before it expires, with less than a quarter chance that the player will agree to a pay cut to stay on the team–if that offer even comes from the team.
The odds that the player and team have landed in a Goldilocks zone where the contract is seen through with no substantial modifications steadily diminishes in length, and there is no length in which it is more likely than not that this will be the case. These odds are inverted for a contract that gets increased in pay or length–likely a function of star players rightly getting the assumption that their play will remain high for seasons to come–but for all contract lengths this remains a very unlikely fate, with players signing for 5 or more seasons getting only a 15.2% chance of continuing their professional relationship with the team in a better manner.
Contract Fate By Position
|Position||Terminated||Pay Cut||Expired||Pay Raise||Extended|
Seeing quarterbacks compete for the lowest negative contract fates and the highest positive contract fates did not surprise me given the higher leverage they have from being the most important position on their team. Slightly surprising was left tackles being the other tight competitor with quarterbacks, but sensible given their role of being the quarterback’s prime protector. Left tackles were more likely than quarterbacks to accept pay cuts in lieu of being cut, the least likely position to see termination as its contract fate.
Among other trends on offense, given the intense discourse currently going on about running back contracts it’s not surprising to see them have the highest odds of having their contracts terminated before completion. But wide receivers are right behind running backs in that regard, and when pay cuts are also factored in they are more likely to see a negative modification to their contract. This fits with Jason’s recent observation on the declining production at both running back and wide receiver when those players enter their vested veteran seasons.
On defense, every position is more than 60% likely to see a negative contract fate. Edge rushers were the only position more likely than not to avoid getting their contracts terminated, but they offset it with being the most likely on defense to accept pay cuts. What stood out the most was the league leading rate of cornerbacks getting their contracts terminated, paired with a league trailing rate (outside of special teamers) of willingness to agree to pay cuts, and second to last only to running backs for positive contract fates.
Contract Fate In Action
Let’s take the four players I cited above as examples: two that were approached by their teams with pay cuts, and two that are approaching their teams with pay raises. These examples will serve as some crosstabs of contract length and position to better judge what odds the players face for their contracts. It is important to not chain these players too tightly to their comparables, as each one has unique circumstances that that have to be taken equally among trends at their position and tenure in the NFL.
Joe Mixon, RB, 4 year contract: 20 players fit this position and contract length, and the fates are pretty grim, as one would expect out of running backs. None had positive contract fates. Only three fulfilled their entire contracts, and only four more made it through Year 3 with no alternations. 65% were ultimately cut, with another 20% choosing the path Mixon ultimately did with a pay cut. This may have informed Mixon’s notable decision to take a pay cut not only for 2023, but also for 2024, instead of revisiting that year at another time. 15% odds of being able to retain his original 2024 salary may have been too daunting.
Kevin Byard, S, 5+ year contract: The contract fate was a little better for Byard than Mixon. Among 18 players in this crosstab, 7 of them (38.9%) made it through Year 4 (the year Byard was approached with a pay cut). Only two ultimately agreed to a pay cut as Byard did, but the termination rate after three seasons was sufficiently high enough at a coin flip of 50% that it was good enough for the Titans to pursue the pay cut, but for the pay cut to be relatively milder in converting $3.1 million in base salary to incentives, but also getting his remaining 2023 salary guaranteed, and $4 million in 2024 moved up to a March roster bonus.
Chris Jones, IDL, 4 year contract: Among 32 such contracts since 2011, only three saw positive contract fates. But among the 12 players that made it through Year 3, eight of them saw their contracts at least completed. Jones’s age at 29, along with his continued high level of play, are mititgating factors that may help offset the considerable fines he will rack up if he does not report to training camp.
Zack Martin, IOL, 5+ year contract: 37 contracts fit this crosstab, and 7 (18.9%) saw upward adjustments in their next contract. It’s a position with longetivity at its longest contracts, with about a third of them making it as long as Martin has through four seasons. Unlike Jones, being at age 33 is an aggravating factor, but the accolades keep coming in for Martin regardless for his excellent play.
I can certainly empathize with the desire to not have to negotiate contracts every other year–particularly if the consequences of such could mean moving myself and my family to multiple cities across the nation. But the bottom line is that the odds are close to 2:1 that the team will force these negotiations every other year for most players, whether they want to or not. Furthermore, there is asymmetry in that the team can choose whether or not to continue the contract at their will, whereas the player cannot. This is what players who signed lengthy deals like Jones (4 seasons) and Martin (6 seasons) will harshly discover, particularly under changes in the 2020 CBA where penalties for refusing to report are escalated. To level out that asymmetry, top tier players in free agency and extension negotiations could demand to only sign shorter deals, perhaps a maximum of two seasons unless the team was willing to fully guarantee seasons beyond that. The few players that have had the leverage and wherewithal to do so (Kirk Cousins being a leading example) have done very well for themselves financially.
The next question would be how teams would react to such demands. They may be more hestitant to hand out contracts with higher APY, higher guaranteed money, and large signing bonuses if they cannot in exchange get later seasons in the contract where they hold their accustomed asymmetric ability to retain or reject the remaining terms as they see fit. This could take time to shift expectations, and a good agent would weigh these negotiating factors with a balance of the desire each player has for his financial potential alongside his desire for stability and other non-financial factors.
At the very least, however, if players are going to cede long contracts with little control at the end, they in return should get some trigger on those laster seasons that forces teams to make a commitment at the very beginning of the offseason rather than near the end of it–at the very least via a small roster bonus due to the player, and at the most via injury guarantees on salary that vest to full guarantees.