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Guaranteed Money Is Now Optional

Credit: USA Today

Lack of guaranteed money in NFL contracts is not stopping players from signing mega-deals, which sets a terrible precedent for future signings.

Last week Andy Dalton was rewarded for his play as the Cincinnati Bengals quarterback with a six-year extension totaled at $115 dollars, a number that at first glance seems astronomical for a player who has thrown one touchdown in three playoff losses. But when the details of the contract were revealed, it became clear that Dalton had left money on the table.

In the NFL, any player earning the total value of their contract is a pipe dream for anyone signing more than a one-year deal. Dalton’s extension includes $18 million of guaranteed money this season, a $4 million roster bonus three days into the next league year, and then zero guaranteed for each of the five seasons he remains on the team. After this season, all Dalton will receive, if he is still on the team, is his base salaries of $10.5 million, $13.1 million, $13.7 million, $16 million, and $17.5 million as well as a $200,000 workout bonus. Escalators in the deal allow Dalton to make more if he leads his team past the wild card round and even a $1.5 million bonus each season if he wins the Super Bowl, but that’s unlikely to happen six consecutive years. Add that up, and Dalton is really left with a seven-year deal worth $96.8 million dollars, all with absolutely no guarantee of being on the team past this season.

Despite generating the most revenue in any sport in the country, the NFL and its owners have kept fully guaranteed contracts out of the hands of their players. The concept of non-guaranteed contracts is great whether you are a fan or an owner. Every year you can put the best team on the field that you can afford and you are never tied down to a bad player with a bad contract like their sports league peers in the MLB and NBA. The NFL embraces teams that go from worst to first, and one of the tools for bad teams to make the turnaround is to shed contracts and gain cap space to sign better players.

The NFL’s love affair with meritocracy is forcing players into taking more money now and less guaranteed money (or, in Andy Dalton’s case, zero for the next six years). The unfortunate side is that players are not helping their cause by taking these deals. Darrelle Revis famously signed a six-year; $96 million contract in Tampa Bay with no guaranteed money. After one season of spectacular play and one coaching change, Revis is no longer a Tampa Bay Buccaneer after they cut him and he signed with New England. 

Taken at face value, the league’s system worked for Revis, who played well with Tampa Bay and then turned his performance into more guaranteed money with New England. But imagine if Revis had torn his ACL for a second time last season. He would not be garnering the same kind of money and the Buccaneers would still have cut him to save themselves from an injury prone prima donna. A team would probably take the gamble, but once again there is no guarantee Revis would get another chance or another dime. In Colin Kaepernick‘s new contract, there is a clause that Kaepernick has to take out a $20 million injury insurance policy, payable to the San Francisco 49ers. The premiums for that kind of policy are not the most ridiculous part of that agreement. It is a risk that falls squarely on Kaepernick for his health and livelihood, something Colin should know is not guaranteed.

Players should be banding together to at least push the needle to more guaranteed money on contracts. The contract Andy Dalton signed took some heat from players after the announcement. Kansas City quarterback Alex Smith was quoted that he wants “something that’s right that I’m going to play out.” Players whose contracts are coming up, like Smith, Russell Wilson, and Cam Newton, should be fighting for more guaranteed money to give themselves more security and future players more leverage in their negotiations. Even Matt Schaub, a practical equal in terms of career success to Andy Dalton, got $30 million in guaranteed money last season with a shorter contract duration and, as it goes in the NFL, Schaub was cut the very next season.

As of this moment, the value of the contracts signed this past offseason are right in line with the markets and with the talent evaluation of each quarterback. Andy Dalton’s contract’s numbers themselves make sense for a quarterback entering his fourth season that has proven capable but is still developing. Colin Kaepernick’s deal makes sense because he still has to prove he can be a top tier quarterback consistently before being paid like Peyton Manning or Drew Brees. But these contracts appear practical in the context of an economic environment that has ignored the unfortunate circumstances of players that are out of the league because of injuries incurred in their sport, and has relegated NFL players to a sub-human level that any commitment can be eliminated on a whim.

Players should not be responsible for shouldering the risk for an owner’s decision.  Andy Dalton should not have to prove he can play in the NFL, when he has already taken his team to the playoffs three straight years. In a league where players suffer significant injuries every season, the NFL should guarantee more than it does.

Edited by Sam Wittenstein.

Which quaterback will receive the highest base salary in 2014?
Created 8/11/14
  1. Jay Cutler
  2. Peyton Manning
  3. Drew Brees
  4. Aaron Rodgers

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