With a few rookies still unsigned the discussion of offset language again rears its ugly head. You can read more about offsets here, but the basics of offset language is that if a players’ contract contains a no-offset clause for guaranteed salary and he is cut, the team that signed the contract is on the hook for the entire amount of money even if the player signs to another team. Sounds very important, but in practice is it really worth the fight that either makes the player look bad for “holding out” or the organization look bad for “not getting the job done”?
Offsets for rookies under the current wage system really should be a non-factor. You have to realize how rare the situation is for the offset to come into play. For the offset to come into play two things have to happen.
- The drafting team needs to be willing to give up on a player that it invested a first round draft pick on within a 4 year window.
- Another team has to actually want to sign this player.
With the new rookie wage scale we are not talking mega millions here. Remember the signing bonus is a sunk cost so looking at the salary cap number is not worthwhile when discussing offsets. Guaranteed salary is all that matters because that is all a team is getting credits for. The number 1 pick in the NFL draft will have a guaranteed salary of $3,430,977 in the final year of his contract. The 9th pick in the draft will have a guaranteed salary of $2,131,515.
Let’s put those numbers in context. Last year Wayne Hunter earned $2.5 million to play tackle in the NFL. Demetress Bell earned $3.25 million. Chase Daniel is going to earn $3.8 million to be a backup QB in Kansas City. Eric Wright is earning $1.5 million to play corner in San Francisco. This is the cost for a replacement player. So how bad must your draft pick be to cut him at the salaries listed above to replace him with bad players, complete unknowns, or off the field trouble makers at essentially the same cost? I’d imagine pretty bad.
If the player is really that bad and that inept what other team in the NFL is going to give him a look? Vernon Gholston was about as bad as a non-QB draft pick could be and was cut. The Bears signed him for camp and I believe gave him a $250,000 signing bonus and $750,000 base salary before realizing how bad he was and cutting him before camp ended. The offsets would have saved a team around 7% of his salary under the new CBA. That’s it. Aaron Maybin, every bit the bust, took a minimum salary from the Jets, was cut, and then got another minimum salary during the season from the Jets. Maybe the Bills got a 10% refund? Is it really worth the fight when you look at the numbers?
Really the only situation where the offset is going to come into play is if you completely whiff on the fit for your player on your team. Maybe it’s a scheme problem. Maybe it’s a personality problem. That’s on the team and their scouting. When you draft a player to be a starting corner in a man on man scheme you should not realize 6 weeks in that he can’t play man and is only good in zone. After all the background checks you do on a player before you draft him you should not find out a year into it that “he’s a bad guy”. Fighting for the offsets is like an admission that you screwed up and quite frankly if you screw up at the top of the draft you are getting fired, offsets or no offsets.
Even in those above scenarios you can probably work out a trade for a player. Offsets don’t matter in a trade. If you trade the player to a team that sees value in him for their scheme or their culture the contract and guarantees transfer with him. If the trade partner sees value at a lesser cost you simply prepay the player a signing bonus before making the trade official. It works the same as if you cut the player and he signed with another team, plus maybe you get a draft pick this way. If the guy is that much of a “culture fit” odds are his guarantees and offsets are going to be stripped away regardless, ala Rolando McClain in Oakland. The offset just isn’t going to be a big factor in reality.
So then why do teams fight so much for not including it and why do agents fight for it? For one the CBA has basically neutered both sides from being negotiators outside of payment dates and some other small items here and there and really when people do these deals they like to point to good things for both sides. The offset language gives someone a feeling of satisfaction. I’m sure Ryan Tannehill’s team was happy to say that Tannehill will earn actual cash before his peers while Jeff Ireland can be happy that the Dolphins held firm on this “critical” point.
For negotiators and GM’s on a team it may set a precedent for future negotiations or show an owner/media how much of a bulldog the guy is. You don’t want to be the guy that gets a reputation for being soft nor do you want to have some rookie deal in some manner hanging over your head when a veteran extension comes up years later and offset language is an issue, as offsets in veteran deals are far more damaging. Even knowing that the rookie offset means little, I would be hesitant when looking at the way the Rams and Lions have approached offsets outside of the top 10 if I was considering hiring people from that organization. By going outside the norm you can set yourself up poorly in the future.
For agent’s it can be something to at least mention when recruiting college athletes. For the most part the college athlete is not going to really understand the reality of the CBA, salary cap, and contract structure. If you get the no offset provision for your clients it can be a selling point especially if you can paint a picture right away of the battle between ownership and players over money. Joel Corry put it perfectly when he said someone could be “the offset king”. In reality it doesn’t mean anything but to a college kid it could be a selling point of sorts.
But for the most part it does little for the players or teams involved. The worst thing that a player can do early in his career is be labeled a “hold out”. While rookies are unique in that they are not under contract the fact is that most people will blame the player for not being in camp. That’s not really fair, especially under the new CBA (under the old one there were cases where the players side was at fault), but that’s reality. It tempers fan excitement which leads to bad press. If the player struggles as a rookie you can guarantee that there will be plenty of talk about how the player missed some days of camp. Again it’s not fair but its reality.
For bad teams fans just want to see their guys on the field and if you are picking top 10 odds are the team is bad. You had enough bad publicity last season. The last thing you need is a dark cloud hanging over your head from day 1. This isn’t negotiating with JaMarcus Russell where you will destroy your salary cap with a bad contract. This is fighting over, at most, $250,000, 4 years down the line. If that’s all we are talking about just give the no-offsets on everything except the year 4 minimum salary.
The bottom line is the offset clause should be a non-issue and it should never hold up someone from reporting on time to camp. If it does both sides are doing something wrong and should be held accountable for the problem.
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.