Eric Decker is expected to be one of the most sought after free agents in the 2014 field.
The 2014 free agency period is upon us. Like so much in American Football, the concept feels simultaneously very familiar, and yet completely distinct from anything we know in British sports. We may all be familiar with the idea of free transfers, and negotiating directly with players from the Premier League or Rugby’s various codes, but salary caps, collective bargaining, restricted vs unrestricted free agency, and, of course, the lack of “for cash” player transactions at all, tend to throw us for a loop.
So we’re here to try to help break down what you need to know about NFL free agency.
What is Free Agency?
Free agency is the inevitable upshot of almost any sport where players sign contracts directly with teams, and not with the league as a whole.
Put simply, a free agent is any player whose rights are no longer controlled by any team. This could be a player whose current contract has expired, who has been released early from his contract, or who is eligible to play in the NFL, but has never been signed to any team.
The NFL’s Collective Bargaining Agreement (CBA), between the league and the NFLPA (The NFL Players Association, the players union) place a lot extra restrictions on free agency which do not exist with some other sports, and which make the NFL’s free agency period unique. But essentially, in the most basic sense, a free agency in the NFL is the same mechanism as a free transfer in Association Football.
How is NFL Free Agency Different From A Free Transfer in the FA?
The presence of the CBA in American Football does add some significant differences between an NFL free agent and a truly free transfer.
The CBA sets down rules which the league, and all players within it, agree to follow about salaries, contracts and negotiations. With regard to free agents, it creates some conditions about who can negotiate with a free agent, when they can start talking to them, and if an out-of-contract player is truly free to sign with any team.
Another major difference between the NFL free agency period and “free transfers” is their prevalence. As “cash” transfers play no part in American Football—a team cannot simply buy a player, but must instead trade other players or future draft picks—free agency, in American Football is, in fact, the primary way in which players move around the league, and along with the draft, the main way teams build their rosters.
Among FIFA players, a player usually only reaches free transfer status if he is considered not particularly valuable. In the NFL, free agents can often be some of the biggest names in the league.
Cash transfers tend to cause teams to ‘cash in’ on players they fear they cannot re-sign, rather than letting them leave ‘on a free’, however, the NFL trading rules mean that many teams often find it more valuable to keep hold of a top-tier player right until the end of his contract, in hopes of keeping him, than to trade them early.
When Does Free Agency Start?
Although players are often refered to as free agents as soon as the previous season ends, NFL contracts all expire together at the start of the ‘free agency period’. Therefore, free agent’s are not free to negotiate with teams immediately. A free agent is allowed to negotiate only with his current team until noon eastern time on Saturday, March 8th. At this point, other teams can begin to approach free agents, but no contracts can be agreed upon or signed with anyone other than the players current team until 4:00 p.m. ET on Tuesday, March 11, 2014 when the contracts officially expire.
This rule means that many potential free agents will not actually hit the free agency market, with a significant number signing with their current teams before the March 11th window opens.
When Does It End, and What Happens at the End of the Period?
The free agency period ends on the 2nd of May, 2014 for restricted free agents. At this point, the restricted free agent (RFA) looses the ability to negotiate with anyone but his current team. For unrestricted free agents, the cut-off date is 22nd of July, 2014, or the first day of training camp, whichever is sooner.
If an unrestricted free agent has not signed an offer sheet by this point, one of two things happen.
If his current team made him a one-year offer by June 1st, which constituted at least a 10% pay raise over last season, and he does not sign with another team before the end of the free agency period, he becomes an “Exclusive Rights Free Agent”. Although he is free to continue to negotiate with other teams between June 1st and July 22nd, if this date passes, without signing a contract, he may then only negotiate with his current team. If no deal is done by the 10th week of the regular season, he will be forced to miss the entire season.
If his current team did not make him an offer, or the offer did not represent a 10% pay raise, the player is free to continue negotiating with any team, at any time, with no other restrictions.
This would also be true of any player cut by a team, who has cleared the waiver system, as well as those who did not play in the NFL the previous season, or any player who enters the draft, but is not selected, a so-called undrafted free agent or UDFA. He is not considered to have a “current team”, and is free to negotiate with anyone, though no rookie is eligible to negotiate with any team prior to the conclusion of the NFL Draft, and is subject to a few more rules, with regards to his rookie salary.
What is the Difference Between a Restricted and Unrestricted Free Agent.
Once the free agency period starts, both types of free agents are free to negotiate with any other team, but RFA’s are not automatically free to join any other team.
Once a RFA he has received a qualifying offer from his current team, the team always have the right of “first refusal” before he can sign elsewhere.
He is free to continue to negotiate with other teams, but if he signs an offer sheet with another team, his current team have the right to match it and retain his services. If the team do not wish to keep the player, they may be compensated in draft picks, depending on the size of the original qualifying offer.
In order for the team to receive the right of first refusal, they must make a qualifying offer of the following:
- First Refusal Only: If the team make at least a one-year offer of at least $1.323 million, the team receive the right of first refusal should he sign an offer with another team. His current team has the option to match this offer, or let him leave.
- Right of First Refusal and Draft Selection at Player’s Original Draft Round: If the players current team offers him at least a one year offer representing at least $1.431 million, the team receives the right of first refusal, or a draft pick equal to the value of his original selection, should his current team choose not to match the offer. For example, if an Arizona Cardinals made an offer of $1.431 million to player was selected in the fourth round, and he signed a $3.75 million, 2 year contract with the Buffalo Bills, the Arizona Cardinals could choose to pay him $3.75 million over two years, and keep him, or receive the Bills fourth round pick in the upcoming draft.
- Right of First Refusal, One Second Round Draft Selection: As above, however if the team offer at least $2.187 million, his current team receive a second round pick as compensation, should they choose not to match his offer, regardless of the round he was originally selected in.
- Right of First Refusal, One First Round Draft Selection: As above, however if the team offer at least $3.113 million, his current team receive a first round pick as compensation, should they choose not to match his offer, regardless of the round he was originally selected in.
As the difference in compensation levels between the first and second tier is so small, teams rarely use the “Right of First Refusal Only” option.
The need to give up draft picks can limit a players options, as some teams will not have draft picks of the appropriate value to give up in exchange, and very few RFAs go on to sign with other teams, usually signing their qualifying offers, or a longer term contract extension with their current team.
How Does A Player Become A Restricted or Unrestricted Free Agent?
Once a player has played in the NFL for three seasons, he becomes a Restricted Free Agent automatically once his contract expires (prior to this, he is an exclusive rights free agent). Once he has completed four seasons, he becomes an unrestricted free agent automatically at the conclusion of his contract.
For the purposes of free agency calculations, a season is counted when any player was on the roster of an NFL club for at least six regular season games in a single season. They do not need to play, simply to be on the active roster.
What are Franchise and Transition Tags, and How Do They Work?
Franchise and transition tags allow teams to effectively force an unrestricted free agent to stay with a team, without him agreeing to a long-term contract.
A franchise tag is an offer a free agent cannot refuse—literally. Once a player has been franchise tagged, he is usually contractually bound to play for his current team for at least one season. Although he can technically refuse to sign the tender, and try to negotiate a longer deal with his current team, he is prevented from signing freely with other teams while the offer is on the table.
There are two types of franchise tag, exclusive and non-exclusive varieties.
An exclusive franchise tag automatically prevents the player from negotiating with any other team. It locks him into a contract with that team—his only other option being not to play at all. The money is guaranteed, and he is welcome to keep working on a new, long-term deal, if he intends to stay with the team for more than one season. An exclusive franchise tagged player receives the average salary of the top 5 players at his position.
A non exclusive franchise tagged player receives a one year offer, which is guaranteed, from his current team. He is allowed to continue to negotiate a better with other teams and is not automatically required to sign it.
If he negotiates a deal with another team, his current team has the right of first refusal to match the deal. If they do not, his current team receive compensation of two first round draft picks. This cost effectively prevents most other teams from seriously negotiating with a player under this tag.
The calculation for the non exclusive tag offer is very complicated, and involves the five-year average of the franchise tag amount for that position, the salary caps for the previous five years, and calculates this as a percentage of the current salary cap. It’s a very complicated formula which results in a figure which is slightly, but not much, less than the exclusive franchise tag value.
In both cases, if the calculated franchise tag offer is not at least 120% of his previous salary, he will receive this amount instead. If a player has been tagged in the past, this minimum offer increases, and after two previous tags, it becomes prohibitively expensive for almost any team to consider using a third time.
A transition tag effectively makes an unrestricted free agent into a “right of first refusal only” restricted free agent. The player receives a one year contract offer, but is free to negotiate with other teams. His current team then have the option to match any offer he receives in the free market, however, receive no compensation if they do not match the offer.
The one year offer for a transition tagged player is calculated as the average salary of the top ten players at his position. This is noticeably less than the exclusive franchise tag, but only marginally less than the non-exclusive tag, which means this tag is very rarely used.
Teams may ‘tag’ a single free agent with any of these three tags, though they are not obliged to use it. A team may use only one tag, regardless of variety, during a season, and although they can rescind their offer to a tagged player, they do not get the tag back at this point.
The high cost and one-year nature means that a relatively small percentage of players actually end up playing under a franchise tag each season. All three tiers of tags are usually used as a tool to try and force a player to return to the negotiating table to work out a long term deal.
How Does The NFL Salary Cap Affect Free Agency?
The NFL is a capped league, limiting the total amount any one team can spend on salaries in a single season. For 2014, that figure is $133 million plus any amount carried over from the previous season.
This means that each team is limited in the amount of big name stars they can keep on their roster at any one time. Teams often have no choice but to let starters walk away because their demands are too high, or their contracts too long.
Teams must be in compliance with the cap from the start of free agency, and teams will need to carry some cap room into the draft to sign their picks.
The result is that very few teams have the buying power to really dominate the field in free agency, but almost every team have a shot at landing at least one or two big name players. Whichever team you cheer for, expect to see one or two of your favorite players leave for pastures new, and similarly, welcome a few new stars to the fold.