Monday, March 20, 2017

How NFL Players Lost Their Leverage

It’s a good time to be an in-demand NFL player, as record spending is making the league’s top free agents richer than ever. As of Tuesday, NFL teams had spent $1.9 billion on unrestricted targets through the first six days of free agency, with $922 million of that guaranteed. Last spring, teams spent $1 billion guaranteed over six weeks. For valuable players hitting the market at the right moment, big deals are the new normal.

For everyone else, though, settling is. The rising salary cap, which sits at $167 million for the 2017 season — up $12 million from last year and $47 million from 2011, the first season of the league’s current collective bargaining agreement — has altered spending patterns in the NFL. And though earnings are rising for the top free agents, a confluence of events has caused them to shrink for those lower on rosters, eradicating the NFL’s middle class and costing its lower tier much of its leverage.

Larger training camp and practice squad rosters mean more players competing for spots on the active roster, robbing those on the fringes of true bargaining power. The rookie wage scale, introduced in 2011 to theoretically push more money toward veterans, has actually hurt aging nonstars, who wind up negotiating below-market deals based on their low initial salaries. And of course, NFL teams remain self-interested even amid the rising cap, reducing their own financial burden using little-known, widely implemented mechanisms like split contracts and per-game roster bonuses.

It wasn’t supposed to be like this. “The goal of [the 2011 CBA] was to give more money to the middle class,” says Mark Dominik, a former Tampa Bay Buccaneers general manager, who’s now an analyst for ESPN. “Instead, what happened was teams rewarded star players, and it created a cavernous pit between types of contracts. It’s a have-and-have-not league.”

NFL teams have always considered lower-rung players disposable. Now, however, franchises have become expert at stacking the deck against those with the least leverage, further splitting rosters into two clusters with vastly different circumstances.

“We’re in a challenging time,” says Rams general manager Les Snead. “I’ve heard [former Colts executive] Bill Polian talk about the concept of ‘monetary dysfunction,’ where you have problems in the locker room because guys are saying, ‘Hey, why is this guy getting this money?’ … The market used to be outdated annually; now it’s outdated on a player-by-player basis. The paradigm shifts constantly. … There’s going to be a natural jealousy.”

During the 2015 season, Ronnie Hillman led the Super Bowl champion Denver Broncos in rushing yards and touchdowns. At training camp seven months later, the Broncos, flush with running backs, released Hillman from the $2 million contract they’d signed him to earlier in 2016. Instead of resuming his role as Denver’s lead back, Hillman had to face the open market a week before the season began. Absent his leverage, he signed a league-minimum deal with the Minnesota Vikings two weeks into the season worth a prorated $760,000 and featuring what is called an “injury split,” which would cost him hundreds of thousands of dollars if he wound up on injured reserve.

As guaranteed money has risen for the NFL’s haves, split contracts have become increasingly prominent for the have-nots. These deals put the risk almost entirely on the player by not guaranteeing the full amount of money unless he stays healthy all season. For example, Donald Brown’s deal with the Patriots last season called for $965,000 total, but a prorated drop to $453,000 if Brown hit IR. This mechanism used to be reserved for late-round draft picks and veterans with extensive injury histories. But according to multiple NFL team executives, over the past few seasons splits and other similarly pro-team, anti-player contract clauses like per-game bonuses have started to creep into more veteran deals than ever before. Nick Greisen, a former NFL player who now sells injury insurance to NFL players, estimates that players leaguewide lost $28 million in salary due to these injury clauses in 2015, up from $19 million in 2013 and $23 million in 2014.

“[Teams] are going to try to keep their money in their pockets as much as possible,” Hillman says. “The league is cheap, man. And you kind of learn they don’t really take care of you like that.” Hillman, who was placed on waivers by the Vikings and picked up by the Chargers in November, says he signed his split contract because “I knew I wasn’t going to get hurt,” but also says he feels for the growing group of players facing slanted negotiations. Hillman believes that the CBA should include more provisions to protect veterans and laments how quickly players are flushed out of the league if they find themselves off a roster for even a moment. “There are lots of things you’d want to change about the CBA,” Hillman says. “But for me, it’s definitely how they handle players out of the league, trying to get another [team]. I can’t complain about that because I got picked up, but just hearing how other players struggle to get back in, or look to the [National Football League Players Association] for help, it just sucks to see your friends go through it.” (The Vikings declined to comment.)

Since the cap started rising, NFL teams have performed a master class in reducing their own financial risk at the expense of lower-earning players. In addition to identifying the proliferation of injury splits, people inside the NFL — from team executives to agents — point to the growing number of contracts built in part on per-game bonuses, which stem from being on the active roster, meaning that to get their maximum salary each week, a player must be on the 46-man game-day roster, not just the 53-man overall roster. Greisen says his data shows that players lost $20 million leaguewide in 2016 due to per-game bonuses.

by Kevin Clark, The Ringer |  Read more:
Image: Getty Images/The Ringer