I had a few questions on players going on IR that have roster bonuses paid per game and how they are treated against the salary cap so its a good topic to touch on. In the last two weeks we have seen Dwight Freeney and Ahmad Bradshaw both go on the IR for their respective teams. In the case of Freeney he had $31,250 in weekly roster bonuses while Bradshaw had $40,625 in weekly bonuses per information I had on the two players contracts.
To determine the salary cap savings for a team the first thing that we need to do is identify the “likely to be earned” portion of a players roster bonus. That portion would be based on games played in 2012( assuming that the bonus is paid for games on the active 46 man roster, which I believe is the case here). For both players that was 14 games, so that makes Freeney’s LTBE charge $437,500 and Bradshaw’s $568,750.
From there we determine the money that was actually earned, which is calculated by games played multiplied by the weekly bonus. Freeney played in 4 games while Bradshaw suited up for 3. That will make the actual earnings just $125,000 and $121,975 respectively. The cap savings are the LTBE charge minus the actual earnings. That works out to be $446,875 for the Colts and $312,500 for the Chargers.
The League, as far as I know, will not credit with teams with the cap savings in the current league year. What they will do is use the money to offset NLTBE incentives that were actually earned by other players at the end of the year and then make an adjustment to the salary cap for each team the following season to reflect the numbers.
So to make a long story short the injuries to the two players will not effect this years cap but will help the Colts and Chargers have higher salary cap limits than other teams in the NFL in 2014.
Jason is the founder of OTC and has been studying NFL contracts and the salary cap for over 15 years. Jason has co-authored two books about the NFL, Crunching Numbers and the Drafting Stage, which are widely circulated in the industry and hosts the OTC Podcast. Jason’s work has been featured in various publications including the Sporting News, Sports Illustrated, NFL Network and more. OTC is widely considered the leading authority on contract matters in the NFL.