Free agency in the NFL begins on Wednesday, March 14th, at 4:00 p.m. For top NFL players, being an unrestricted free agent is the first time in their careers that they will be able to sign a market rate contract after having been previously subjected to the rookie contract and possibly the restricted free agency rules contained within the CBA.
This is a great time to be an upper echelon NFL player, right? Not so fast!
NFL players that have accrued at least four NFL seasons and aren’t under contract (unrestricted free agents) may sign the long term deal of a lifetime during the free agency period. But, for the chosen few, the best-of-the-best would-be unrestricted free agents, not all is as it seems.
Under the rules of the CBA, teams have the ability to tag a player that would otherwise be an unrestricted free agent as either a franchise player or a transition player. Both of these tags keep the player from becoming an unrestricted free agent for at least one more year.
Types of tags
There are two types of franchise tags, the exclusive rights franchise tag and the non-exclusive rights franchise tag. There is also a transition tag that may be used instead of either of the franchise tags.
Non-Exclusive Franchise Tag
The most common type of tag is the non-exclusive franchise tag.
This tag is a one-year tender calculated by averaging the top five salaries at the player’s position over the past five seasons, then determining what percentage of the salary cap this would have been, on average. This percentage than gets applied to the current year’s unadjusted salary cap number to determine the non-exclusive franchise tag value by position. However, this tender amount is guaranteed to be at least 120% of the player’s prior year salary.
For 2019, the non-exclusive franchise tag numbers are:
- Quarterback: $24,865,000
- Running Back: $11,214,000
- Wide Receiver: $16,787,000
- Tight End: $10,387,000
- Offensive Line: $14,067,000
- Defensive End: $17,128,000
- Defensive Tackle: $15,209,000
- Linebacker: $15,433,000
- Cornerback: $16,022,000
- Safety: $11,150,000
- Kicker / Punter: $4,971,000
The non-exclusive franchise tag numbers are generally lower than the numbers calculated using the exclusive rights franchise tag methodology, which we will explore below.
The tagged player is allowed to negotiate a contract with another team. This is rare, as the team that tags the player will have the right to match the offer, and if that team declines to match, then the team that negotiated the contract with the player will have to surrender two first-round draft picks to the team they are signing the player away from.
Not many teams are willing to give up two first-round picks to sign a player to a top of the market deal. Where that would be more likely is for a true franchise quarterback. If those quarterbacks were to ever reach unrestricted free agency and have a tag applied to them, it would typically be the exclusive franchise tag.
Six players were tagged with the non-exclusive franchise tag for 2019.
Exclusive Franchise Tag
The exclusive franchise tag doesn’t permit the player to negotiate a contract with another team. That player is tied to his existing team for one more season (at least). The exclusive franchise tag is used less often than the non-exclusive franchise tag.
The player is guaranteed a one-year tender that is the average of the top five salaries at his position for the then current season as determined at the end of the restricted free agency period, or 120 percent of his salary for the prior season, or the amount of the required tender for a non-exclusive franchise player, whichever figure is the highest.
As the restricted free agency period is not over yet, these tender amounts have not been determined. However, no players were tagged with the exclusive franchise tag for this coming season, so the number is not relevant for purposes of the 2019 season.
The same formula is used to determine the transition tender amounts as is used for the non-exclusive franchise tender, except that the top 10 salaries at the position over each of the last five seasons are used to determine the percentage of the cap to be allocated to the transition tag.
When a team applies a transition tag to a player, that player is free to negotiate an agreement with another team. And, the current team does have the right of first refusal to match the offer. But, unlike the non-exclusive franchise tender, there is no compensation due to the team losing the player if that team declines to match the offer.
The transition tag amounts applicable to the 2019 season are:
- Quarterback: $22,783,000
- Running Back: $9,099,000
- Wide Receiver: $14,794,000
- Tight End: $8,815,000
- Offensive Line: $12,866,000
- Defensive End: $14,360,000
- Defensive Tackle: $12,378,000
- Linebacker: $13,222,000
- Cornerback: $13,703,000
- Safety: $9,531,000
- Kicker / Punter: $4,537,000
Compared to the non-exclusive franchise tender, the transition tag amounts are generally less. This is because the salaries of the top ten players at the player’s position are used to calculate the transition tender amount instead of the salaries of the top five players at the player’s position, which are used to determine the non-exclusive franchise tender.
No players were tagged with the transition tag for 2019.
Common to all tag types
Despite the differences detailed above, the franchise tags and the transition tag have many commonalities, including:
- For the 2019 season, NFL teams may designate franchise and transition players starting on February 19th and ending on March 5th.
- Teams are limited to tagging only one player each offseason, regardless of which type of tag is used. This one player distinction can be important, particularly if a team has two players to which they are considering applying a tag. Once a player is tagged, the team has used their tag for that season, even if they were to sign that tagged player to a long term contract or rescind the tag (in which case the player would become an unrestricted free agent). Because of this, many teams will wait until near the end of the tagging period before using their tag designation, if they use it at all.
- A tagged player and a team can agree to a long term agreement while a tag is applied up until a deadline date typically in mid-July. After this date, the player will only be able to play under the tag applied to that player, or not play at all in the NFL that year.
- If the player remains tagged but has not signed his contract, that player must sign no later than the Tuesday following the 10th week of the season. Otherwise, that player will not be permitted to play in the NFL that season.
- A player can be tagged up to three times by his team, with a bump in pay each time.
- If a player signs the tender, the player’s salary is fully guaranteed for that season (for skill, injury, cap). The player and the team can not agree to a contract extension until after that team’s last regular-season game.
Use of the tag in 2019
For the 2019 league year, six players were designated with the non-exclusive franchise tag.Embed from Getty Images
Those players are:
- Cowboys defensive end DeMarcus Lawrence (second straight year)
- Texans linebacker Jadeveon Clowney
- Seahawks defensive end Frank Clark
- Chiefs linebacker Dee Ford
- 49ers kicker Robbie Gould
- Falcons defensive tackle Grady Jarrett
What’s the big deal?
This is great for the players, right? They get the opportunity to be paid as one of the highest paid players at their position, right?
Well, it’s not that simple. It is undisputed that football is a violent sport. Injuries happen. Skills decline.
Generally, long term contracts in the NFL aren’t guaranteed for the full contract term. However, a pro bowl type player (usually the players subject to a tag), could receive a large guaranteed signing bonus and guaranteed salary beyond the one year that would be covered by any of the tags covered in this post.
Playing on the tag is undoubtedly paying the player a salary at the top of the market for that season, but that’s it. All of the risk beyond that one season is on the player. During the tagged season, if the player gets hurt, his skills diminish, or the system his team plays doesn’t adequately showcase his ability, his signability for the next season may be significantly diminished.
Some of you reading this may say that that’s the way that things should be. That a player should only get paid when his performance justifies the salary. However, that’s not really the point here. Other than the very few players that get tagged each season, all other players that have reached unrestricted free agency are free to sign any contract, with the team of their choosing. Tagged players simply don’t have this freedom.
The player’s only leverage in this situation is to sit out the entire season and bypass the one-year guaranteed salary that comes along with signing the franchise or transition tender. But, if the player sits out he will be another year older by the time the next offseason comes around, in a league where players have short shelf lives.
Le’Veon Bell is an example of a player that used his leverage by sitting out the entire season. Bell had played under the franchise tag the season before, and was tagged again before the 2018 season. Bell’s 2018 tender amount was $14,544,000, a tremendous amount for a running back in today’s NFL.Embed from Getty Images
Concerned with his workload, the risk of injury, and that the franchise tender was only for one year, Bell decided to sit out the entire season, foregoing every penny of the $14,544,000 franchise tender amount.
The Steelers did not designate Bell with the franchise tag for the 2019 season, meaning that he will become an unrestricted free agent when the league year begins, and will be free to sign with any team, without compensation due to the Steelers.
While Bell wasn’t injured on the football field in 2018, it remains to be seen if Bell will be able to negotiate a long term contract with another team that will more than make up for the earnings lost by not playing in 2018.
There are provisions that are not necessarily in favor of the team as it relates to the franchise and transition tags which are worth a quick mention.
When a franchise tags a player, that player’s tender amount is applied to that team’s salary cap at the start of the league year and remains on the cap at that amount when the player signs. Once the player signs the tender the contract for that season can not be renegotiated, and the team has no ability to spread the cap hit over multiple years, as it could do by providing a signing bonus as part of a long term agreement.
The salary cap hold is only removed from the cap if the player signs a long-term agreement with the team (with its own cap implications) or if the team rescinds the tag. This cap hold could impact the team’s ability to successfully maneuver through the free agent market while it negotiates a long term agreement with the player.
Franchise and transition tags likely aren’t going away any time soon. While these tags are not supported by the players, they impact only a very few players each year. The reality is that when negotiations take place for a new CBA, there are issues that impact many more players that will likely be a priority for the NFL Players Association. If changes are made, it will likely be to the formulas for determining the salary for the tagged players and possibly increasing the number of positions for which separate salary values are determined.
Though this is a long post, we did not cover all issues that may arise in a franchise or transition tag scenario. Other issues could include trading tagged players, tagging the same player in consecutive seasons, determining a player’s position when he is more of a hybrid, and what compensation categories are included in the calculation of the tender amounts. To learn more about these issues and others, see the CBA and my CBA summary.
Please leave any comments or questions helpful to advancing the discussion of the franchise tag and the transition tag.