The League

Michael Kun

Michael Kun

Co-author of The Football Uncyclopedia. He is also the author of six other books and is a practicing attorney.

Need for guaranteed money


Is it just me, or are the NFL revenues distributed incorrectly among the players?

I'm not talking about the percentage of the revenues that gets apportioned to players under a collective bargaining agreement. I'm talking about how that percentage is divided up among the players themselves.

Why is it that the completely unproven first-round draft pick gets a mega-contract, which he may or may not live up to, while the solid, proven veteran often earns a small portion of that? Why does the system seem to reward potential more than it rewards actual performance?

Case in point: JaMarcus Russell, who has been one of the highest paid players in the NFL for the past several seasons. Yes, that JaMarcus Russell. Erstwhile Raider quarterback. Current criminal defendant. Why did that JaMarcus Russell earn tens of millions of dollars for his short career, which fluctuated between competent clipboard holding and abysmal actual quarterbacking, when some of his own teammates who were actually doing their jobs were making league minimum, or something close to it?

Why does the system permit this and countless other, similar examples? Because the system is broken, that's why.

It's not that the NFL isn't sharing enough of its revenues with the players. It's that the system doesn't divide those revenues up properly. And one reason is that NFL players, unlike their counterparts in the other major sports leagues, generally do not have guaranteed contracts.

In baseball, if the Boston Red Sox sign a shortstop for $18 million for four years, and he plays poorly or gets injured, guess how much he makes: $18 million. In basketball, if the Lakers sign a backup center for four years and $18 million, he makes $18 million whether he averages 10 points a game or 0.1. But if the Bears sign a tight end for four years and $18 million, how much does he make? The answer is: it depends. It depends upon how much of it is guaranteed, if he's cut, etc., etc. A contract for $18 million means $18 million everywhere but in the NFL.

It's incumbent upon each player to negotiate as much guaranteed money as possible. We all understand how the free market system works, and I'd be the last person to suggest that any player should willingly accept less guaranteed money that he can obtain through negotiation. And that's what draftees and free agents largely try to do. In a profession where one's career can end at any minute, and where careers are notoriously short, they are trying to get as much guaranteed money as they can. That's what they should do. That's what you or I would do.

And in a profession where players' careers can end at any moment, and where there is (normally) a salary cap, teams don't want to guarantee too much money to a player who might be sidelined for much or all of his contract. In a league with a cap, that's understandable. You could end up with a team of retired or sidelined players, unable to field a decent team because you've hit the cap.

But while it may seem that non-guaranteed contracts benefit the teams, and guaranteed contracts would hurt them, that's not necessarily so. If there's a cap, the teams will generally spend the same on contracts regardless. The issue isn't how much is spent on contracts, it's how that money is divided up among the players. All non-guaranteed contracts do is create this system whereby the unproven draft picks end up signing huge contracts that dwarf those of their established teammates.

I understand why the unproven draft picks would like this system, but why do the veteran players allow this to continue, particularly when they have a union that could help them create a more equitable system to divide up the same money? It would not solve all of the labor issues, not by any means, but the union could push for guaranteed contracts to benefit their members.

If there were guaranteed contracts, the effect should be a more equitable distribution of money among the players based on performance, not potential. Players would negotiate with the understanding that they may give up years of non-guaranteed Monopoly money in exchange for the security of guaranteed contracts. Owners would divide the exact same money up differently based on merit, taking into account the possibility of season- or career-ending injuries.

Players as a whole would still end up being paid the same, but individual players would end up with more equitable contracts. The same thing could be done with a rookie salary cap.

This is all just a very lengthy build-up to saying that we are now just days away from the opening of training camps and, unless something happens between the time I send this to the editor and the time he posts it, only one first-round draft pick has signed a contract -- Dez Bryant with the Cowboys.

Why is that?

There's been some speculation that there may be collusion among the owners. Unless there's some evidence, I don't buy that. Not for a second. Owners don't need to collude on this issue. Owners don't need to get together to decide that they don't want to enter into contracts with large guarantees without knowing what the next collective bargaining agreement will look like -- or if or when there will even be a next collective bargaining agreement.

If I were an owner, I'd be awfully reluctant to enter into a such a contract with an unproven player, not knowing how that contract might hamstring me under a future, unknown collective bargaining agreement. I wouldn't need Dan Snyder or Jerry Jones to whisper in my ear, and God knows they don't need anyone whispering in their ears about this either. (On other subjects, though, a little whispering might help them.)

At the same time, if I were a player, I'd want to push for as much guaranteed money as possible for the same reason -- because I don't know what the next collective bargaining agreement is going to look like, or if or when there will be one. The uncertainty of the next collective bargaining agreement is what is keeping the owners and the first-round picks apart, and you can't blame either side for that. And the next collective bargaining agreement isn't going to be finalized before the 2010 season begins.

At some point, with that uncertainty hanging over their heads, the owners and the current group of first-rounders are going to have to take their chances. At some point, likely in the next few days, the logjam will be broken.

Taking into account the risks, some team and some first-rounder will negotiate an agreement, and, once that logjam is broken, the others will all begin to fall in place. Yes, there will be some holdouts, but that always happens. Maybe a player even misses a game or two, but that isn't that unusual either. Then we can all sit back and watch the Cowboys and the Jets work their way to their inevitable meeting in the Super Bowl, because that's what every magazine and website has guaranteed us, isn't it?

By Michael Kun  |  July 23, 2010; 12:36 AM ET  | Category:  Collective Bargaining Agreement , Draft , NFL Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   StumbleUpon   Technorati  
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you're all wet on this one.
the players already have guarantees, known in the league and among the commentariat as "guaranteed money." also known as signing bonuses, roster bonuses, etc. . .
the guaranteed money is negotiated between the players and management.
that unproven players garner exorbitant and unwarranted "guaranteed" money speaks to a limitation on rookie contracts, which i understand the union is open to, provided the veterans and player (even ex-player) pensions receive the found money. first round rookies simply have too much leverage, and they use it to the detriment of proven veterans.
by the way, if jamarcus russell's contract were guaranteed in the same way an nba contract is, he'd still be holding a clipboard in oakland as the team's highest paid player.
hypothetically, if peyton manning signs a 5 year guaranteed for $25,000,000 per year, then suffers a catastrophic and career ending injury in game one, the colts would be uncompetitive for 5 years, dooming the franchise. you can imagine any number of scenarios where guarantees would cause similar havoc and despair.
the nfl system of guarantees has it all over the nba and mlb. it may need some tweaking, but blanket guarantees will lead to more new york knicks teams and less new orleans saints teams.

Posted by: larryis43 | July 25, 2010 8:22 AM

The current system is adequate, and can easily be adjusted with a rookie salary cap for draft picks. In a league where the average career is four years, and the edge between "starter": and "washed out in training camp" is minimal, the current system ensures that players are paid as long as they are good, and no longer. Players are hardly sent to the glue factory, they have every incentive to negotiate up front money and they do so. If the NFL changed to guaranteed money for all contracts, there would be few long term deals lest teams be forced to fill a roster spot with a has been or get nothing back for the fans' money.

Posted by: Nemo24601 | July 25, 2010 9:09 AM

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