So there has been a great deal of talk this week about rookies being underpaid. I think it came out from a really good article by Mike Freeman and later our buddy Chase Stuart chimed in on the topic as well with some good input. Ive written about the benefits derived from the draft before and how at the least it should be used to revalue trade charts since the benefit is potentially great for teams. That said I do think there has been some misstating of the cause and effect here.
The prevailing thought is that the cause of this imbalance is from the 2011 CBA which instituted a firm wage scale on drafted rookies. Prior to this CBA there were a large number of loopholes that agents found to drive the prices of rookies through the roof, primarily at the top of the draft. For example players like Ndamukong Suh, Gerald McCoy, Aaron Curry, Trent Williams and others became among the highest paid at their positions before they ever stepped foot on the field. Almost all became the highest guaranteed players. Many justified the cost but plenty did not. In the new system only running backs really still hit those marks.
The league let it get away from them in my opinion during that timeframe because in general the top of the draft is dominated by bad front offices. Such teams often did some very crazy things to get players into camp and the better teams, all of whom end up in the top 10 at some point, couldn’t avoid doing the same. About the best they could do was avoid certain players or agents because of the cost involved. Hence the new system was meant to be dummy proof and prevented the worst teams from doing deals that set the league on fire. But outside of the top picks that wage scale was almost always in place. That’s not a popular opinion but I think we can back that up.
So what Im going to do here is look back at the top 20 players from the 2011 and 2012 draft and try to find a reasonable comparable from the old draft system and see how the dollars and cents work out over the first six contract years. To be a bit fairer we will inflate the older player’s salaries based on their pay as a percentage of the cap over the first 6 years of their contract. Here is the list I selected (if there is a NA it means that there was no notable player drafted at that slot)
|Pick||Player||Earnings||Comp||Comp Earnings||Comp Inflated||Gain/Loss|
|6||J. Jones||$51,683,750||C. Johnson||$68,250,000||$76,424,430||-$24,740,680|
All in all I think this is a pretty fair representation of what the rookie wage scale was designed to do. The top 8 picks saw their salaries significantly stunted, primarily because of earnings lost in the first four or five years of their contract and potential leverage lost regarding their extension. Von Miller was probably the most impacted by the changes since the system effectively tied the extension year values to the position whereas Suh was simply paid on a scale where all number 2 picks earned a pretty big number. I’d also say that Patrick Peterson was hit very hard as I didn’t have a good comparable for him due to position. Had I used Eric Berry the disparity would have been even bigger. Julio Jones and Ryan Tannehill are a bit overstated since I used slightly higher selected comps for them.
But once you get outside the top 10 (and Gilmore vs Revis is a stretch there since Revis was so great and renegotiated his rookie deal after 3 years following a holdout not some CBA rule) in general the numbers balance out or favor the players in the current CBA. A good deal of this, IMO, again deals with positional valuation. In the old CBA 5th year salaries were more or less negotiated based on draft slot. Under the new system they were tied to position with no distinction being made between the 11th and 32nd pick. If we went further out and started looking at Chandler Jones, Muhammad Wilkerson, etc… the numbers would be more in favor of the current system.
I think the real takeaway is that the new system saw a transfer of wealth between good players in the first round with less money being paid to the top 7-10 players and more going to 11-32.Obviously there is a big savings from the bust prospects. For example Darrius Heyward-Bey had earned nearly $37 million over his entire career while someone like Jake Locker was under $13 million. For weak drafts like 2013 that is a major cash savings for the league.
It certainly doesn’t balance out (my guess is if we run out to 32 there is probably $72 million in savings on good players and more on busts even factoring in possible raises for those outside the top 10) but I don’t think it’s going to veterans either. The NFLPA, in the last negotiation, failed to differentiate veterans and rookie salaries on a percentile basis. While minimum salaried vets should fairly be priced between $2 and $3 million with somewhere between $250 and $350K in guaranteed salary they remain stuck at $855K and $80K in guarantees. That doesn’t put the team in a position to have a real decision in front of them nor pay a reasonable salary for older players who play a valuable role on the team.
But the inequality in rookie salary vs actual performance has almost always existed in the draft. It’s not exclusive to the current CBA; it has been something that owners have continuously used to keep wages for players down and that is being lost in the shuffle. In the past the first few picks were overvalued unless the player was a bonafide stud, but the benefits almost always rested with the teams. It’s a bit moreso now but its not new to the current CBA regardless of how blind we would get to some of the massive numbers being floated for those top 10 players.
One of the problems with the negotiation of the CBA is the fact that the union seemed to miss the fact that this really should not be about veterans vs rookies, regardless of who was doing the voting on the new CBA. We all have a tendency to look at every player in the NFL for four years or less as a “rookie” but that is doing a disservice to all players. A rookie generally proves his worth by his second or at the latest his third year in the NFL. The union needs to be looking at any player beyond 2 years in the NFL as a veteran because that is when the money should come in. They failed to do that when they continued the same four and five year contractual system that has always been in place.
In some ways they made it worse because they stripped agents of their ability to use bad teams to drive prices for the NFL league wide. They also eliminated the RFA system almost entirely by demanding four year contracts which eliminated agents abilities to gain higher fourth year salaries for players either through workout based escalators or simple RFA contract procedures. The NFL sold it as veteran aid and the union bought it hook, line, and sinker. It was more of the same.
The NFL is very different than any other sport because the players prime years generally end around the same time as a players rookie contract. In the NBA we see plenty of players productive in their 30s even as their 20 year old athleticism leaves them. Baseball players last forever. By 30 the average NFL player is about as useful to most teams as I would be, yet the system in place still holds so many rookies onto their rookie contracts until they are 28 years old.
If you want to fight for veteran rights you have to understand that once a player proves his worth in the NFL they need to get paid. Whether that is through built in options, negotiated by agents not based on some old Jimmy Johnson draft chart, or short term contracts the path to veteran benefits comes from the right to get real raises and commitments at the age of 25 and 26.
But this isn’t exclusive to that 2011 CBA. It has been in place for ages and has become accepted practice by the league. The NFL, in my opinion, does a great job of riding on public sentiment and using it to mold negotiations. More guaranteed salaries, less practice time, more concussion protection, less power for the commissioner are all going to be ideas floated by the league to avoid any discussion about ways for players to get paid at a younger age. The rookies of today are the veterans of tomorrow and to do the best by them means to focus on rookie rights and freedoms. Nobody has done it yet and Im not sure enough people realize it.
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.