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Guaranteed contracts for NFL players would lead to shorter contracts


Joe Robbins

The annual NBA free agency period has renewed calls for fully-guaranteed contracts in the NFL. So let’s dust off concepts I’ve probably articulated in the past, but am too lazy or ill-equipped to locate.

Before doing that, remember this: One finite slice of NFL contracts has become fully or mostly guaranteed. Specifically, the deals given to all first-round draft picks carry millions each year in guaranteed pay. For the first 20 or so players who are picked, every penny of the four-year contract is fully guaranteed at signing.

Beyond that, players and teams are free to negotiate guaranteed pay for all or part of a contract. The best players routinely get full guarantees for two or three years at the most. If, as a practical matter, the NFL were ever to commit to fully-guaranteed contracts on an across-the-board basis, few contracts would be longer than two or three years in duration.

Currently, it makes little sense for players to commit beyond two or three years. In the later, non-guaranteed years of the deal, the team has the ability to tear up the contract or to squeeze the player to take less. So if the team doesn’t leverage the player to take less (or flat-out dump him), it’s fair to conclude that the team regards the balance of the contract as a very good one for the organization -- and necessarily not a good one for the player.

So, basically, the adoption of fully-guaranteed contracts for all NFL players would result in, for most players, shorter contracts. Which would be good for players not only because they’d be getting guaranteed contracts but also because they’d have more opportunities to push their way to the open market.

Here’s another problem with long-term fully-guaranteed contracts in the NFL. With a salary cap firmly in place, teams would be required to continue to devote space to players who are no longer deemed to be worth the investment, at the expense of other players who are viewed as being in a better position to thrive. It’s another reason why teams would push for short-term deals, if forced to guarantee the full duration of each contract.

Then there’s the funding issue, which started as a shield for players but eventually became a sword for the teams. Due to concerns about cash flow and liquidity, the NFL Players Association insisted years ago on payment into escrow of fully-guaranteed amounts, so that the money would be available when the player is due to receive it. Cash flow and liquidity are no longer concerns in the modern NFL, but teams routinely refuse to commit large future sums on a fully-guaranteed basis because of the outdated funding rule.

Could some players currently secure deals that include significant guarantees in future years? Yes, with franchise quarterbacks (who tend to both stay healthy and continue to be franchise quarterbacks) leading the way.

To date, the closest any veteran player has come to a fully-guaranteed contract beyond three years was Dolphins defensive tackle Ndamukong Suh, whose fully-guaranteed $60 million over the first three years includes rolling guarantees in 2018, 2019, and 2020 that vest if he’s on the roster on the first day of each league year. It means that he’ll either get the money in 2018, 2019, and 2020, or he’ll get a ticket to the market at a time when the market still has real money in it.

If the Dolphins had been required to fully-guarantee all six years of the contract, chances are that it wouldn’t have been a six-year deal.

With football being the ultimate meritocracy, a system that encourages shorter-term deals may be the best outcome for players who hope to parlay merit into pay. Regardless, that’s the most likely consequence of fully-guaranteed contracts -- shorter deals and, in turn, more opportunities for players to sign new ones.