With the Jets and Sam Darnold still at a contractual impasse over apparently offset clauses in his contract I thought it was worth just talking about how ridiculous this is for a team to lose a player, especially a QB that you traded up to draft, even for a day.
The concept of the offset is simple. A team guarantees a player X amount of dollars and if the player is released he will collect that full amount. If he has an offset in his contract and signs with another team the team that cut him will get some of their money back. If he doesn’t have an offset in the contract he collects both the guarantee from the original team and a salary from the new team. The popular phrase to describe this is “double dipping”.
From a team perspective for draft choices this is a nonsensical fight. Darnold’s four year contract will be worth $30,247,694 when he officially signs with the team. The entire contract is guaranteed. Of that total, $20,078,324 will be paid as a signing bonus. So right off the bat 66% of the contract will not have an offset since signing bonus money is always kept by the player if released for football reasons.
Now lets work through the scenarios for Darnold. It is very clear that he will not be released in the first year of his contract. So the $480,000 regular season salary he earns this year is going to be paid by the Jets, offset or no offset. His salary next year will be $1.85 million. Even Christian Hackenberg lasted two years with the Jets and he was a UDFA level talent masquerading as a second round pick. So in any scenario the Jets are paying his salary that year.
We now round into year 3 where Darnold will earn $3.229 million. What top 10 picks were cut after just two seasons? Blaine Gabbert wasnt nor were Jake Locker or RG3 and they were probably considered the most disappointing picks of the new CBA. Old CBA years? JaMarcus Russell hung around 3 years. Matt Leinart stuck around the Cardinals for awhile. Mark Sanchez got an extension from the Jets. Even if year 3 wasnt a lock (see Manziel, Johnny) if you are so bad that you are getting cut in year 3 your career is shot (see Manziel, Johnny). So year 3 is a lock to be paid by the Jets offset or no offset.
Year 4, in which he will earn $4.605 million, could be a question. While its rare to see a player cut in that year I cant say its impossible. Its probably like a 10% chance but it exists. How much would Darnold collect from a new team if he was cut and had offsets in his contract from the Jets? $750,000 would be the likely number. Thats the minimum salary for a player with that many years of experience. If he was bad enough that the Jets couldn’t find a trade partner and had to be cut by the Jets and the Jets owe him $4.605 million no team would consider paying him more than the minimum as base pay for 2021.
So from the Jets perspective we are basically talking about possibly earning back 2.5% of a contract for a player you expect to be the future of your franchise. 2.5%. Thats insane to waste development time over that. Factor in the odds of collecting that back and you are probably looking at safeguarding 0.5% of the deal.
From the players perspective there is a little more to gain. If Darnold was cut in year 4 and had no offsets he could probably get a $1-2 million deal with another team just based off draft status. But for the Jets that shouldnt be a concern because the offset salary is far higher than that number and it wouldnt make sense for a team to pay that highly.
There are two organizations that understand the logical approach and that is the Rams and Jaguars (the Lions used to do the same but I dont think they do anymore). Both teams are fine doing the no offset because they know the odds are so slim of collecting on it why waste the time? This moves into their veteran deals as well and there its more risky but the concept is the same- identify when the player may be cut and make sure that year has offsets, which is exactly how the Rams handle their veteran contracts. The Jets did something similar with Darrelle Revis a few years ago too. The odds of a veteran being released are far greater than a top pick.
I get the precedent argument and the fact that you dont want this to hurt you in the future, but when you are talking QB you can throw it all out. They have always gotten special treatment and will likely continue to get special treatment for years to come. And even still for the same level of pick it is still incredibly low odds of cutting the player.
I just dont get the fight over it. At worst just go with no offsets for all but the minimum in the final year. The financial reward with the rookie player just isnt there to waste time over such a minor possibility.
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.