The only aspect of american sports im still not sure of is contracts. Im from the UK and contracts are dealt with differently over here. If a soccer player gets a 4 year contract worth £4 ($8) million a year that is all guaranteed unless he gets an upgraded contract during this time. When i read about a player getting a contract for an NFL team only a certain amount is "guaranteed". Why is this? are teams allowed to cancel a contract at any time without compensating the player?
can someone help me with contracts?
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NWFLJoe
VIPs: better looking than the riff raff
The only guaranteed money in an NFL contract is the signing bonus. The rest of the money is dependent on the player's stauts with the team.
For example, say a team signs player X to a 5-year contract at escalating pay of $550,000 the first year, $750,000 the second, $1 million the third, $1.2 million the fourth and $1.5 million the fifth year. That's $5 million. In addition, they give him a $2.5 million signing bonus. Total value of the contract is (a highly simplified) 5-year, $7.5 million contract. At first blush, this looks like a $1.5 million per year deal.
Player X blows out a knee on his way to mini camp and never plays. The team is still out the $2.5 million and that will count against the salary cap. However, the team doesn't pay player X another dime. Or the team decides the guy's a stiff so they cut him after the first season. Because he's not on the team, he doesn't get the pay for years 2-5. But he still keeps his signing bonus.
Harsh reality. That's why players fight so hard for the signing bonus. It's their only guaranteed money in an uncertain business. Uncertain from the players' perspective, that is.
For example, say a team signs player X to a 5-year contract at escalating pay of $550,000 the first year, $750,000 the second, $1 million the third, $1.2 million the fourth and $1.5 million the fifth year. That's $5 million. In addition, they give him a $2.5 million signing bonus. Total value of the contract is (a highly simplified) 5-year, $7.5 million contract. At first blush, this looks like a $1.5 million per year deal.
Player X blows out a knee on his way to mini camp and never plays. The team is still out the $2.5 million and that will count against the salary cap. However, the team doesn't pay player X another dime. Or the team decides the guy's a stiff so they cut him after the first season. Because he's not on the team, he doesn't get the pay for years 2-5. But he still keeps his signing bonus.
Harsh reality. That's why players fight so hard for the signing bonus. It's their only guaranteed money in an uncertain business. Uncertain from the players' perspective, that is.
thanks
Thanks for that very helpful.
Im assuming then that its very rare for a player to see out his contract with a team as there not going to want to pay him his final few years which could be expensive.
This style of contract seems to actively encourage players to change teams and also to play at a higher level during specific years as opposed to going all out every year.
Are you guys happy with the type of contracts given out or do you think they need to be changed?
Thanks for that very helpful.
Im assuming then that its very rare for a player to see out his contract with a team as there not going to want to pay him his final few years which could be expensive.
This style of contract seems to actively encourage players to change teams and also to play at a higher level during specific years as opposed to going all out every year.
Are you guys happy with the type of contracts given out or do you think they need to be changed?
NWFLJoe
VIPs: better looking than the riff raff
"The only aspect of american sports im still not sure of is contracts. "
"This style of contract seems to actively encourage players to change teams and also to play at a higher level during specific years as opposed to going all out every year."
Sounds to me like you've got a really good understanding of the situation...
If a player is going to be great, he's not playing for the money. He's playing for pride, to win, and for a legacy. A player who plays for money is never going to be the guy I'd want the season to depend upon.
So I don't have a quibble with the current contract system. Hell, I don't care if a guy gets paid. But that doesn't mean I want my team stocked with a bunch of mercenaries, either. The teams who build true teams are the ones who win games and championships. The ones who're built of players whose first priority is to maximize their earnings rarely succeed.
My $0.02. Or as you might say, my £0.01...
"This style of contract seems to actively encourage players to change teams and also to play at a higher level during specific years as opposed to going all out every year."
Sounds to me like you've got a really good understanding of the situation...
If a player is going to be great, he's not playing for the money. He's playing for pride, to win, and for a legacy. A player who plays for money is never going to be the guy I'd want the season to depend upon.
So I don't have a quibble with the current contract system. Hell, I don't care if a guy gets paid. But that doesn't mean I want my team stocked with a bunch of mercenaries, either. The teams who build true teams are the ones who win games and championships. The ones who're built of players whose first priority is to maximize their earnings rarely succeed.
My $0.02. Or as you might say, my £0.01...
Hey,thanx for the education on how the contracts work....i knew the signing bonus was guaranteed,i just wasn't sure how the rest of it panned out,so again,ty for that. it helps me understand better also.