The off-season can become confusing with all of the terms used concerning players, finances, etc. Here is a quick breakdown to help you read between the lines:
Collective Bargaining Agreement(CBA): The NFL's Collective Bargaining Agreement (CBA) is an agreement between the NFL Players Association (NFLPA) and the NFL owners for reaching an equitable agreement in terms of finances.
Salary Cap: Salary cap is the amount of money granted to each team to be spent on player salaries. As NFL revenues grow, so does the amount of the salary cap assigned each year. The salary cap for 2008 has been set at $116 Million. The NFL salary cap has been in existence since 1994, and it will continue until at least through 2011 (the original CBA has been extended five times already). Based on all of the salary cap rules that are in place, the management of the salary cap usually takes a team of attorneys. So why is their a need for a Salary Cap? Keep reading.
Free Agency: Free Agency is where players have the freedom to test the market after a specific period of service is completed. To control the escalation of players’ salaries during free agency, the team owners sought a means of controlling this. Now do you understand why there is a salary cap? The Free Agency system is limited though by the team owners’ ability to protect certain players by using either a franchise tag or transitional tag.
Franchise Tag: The Franchise tag is a designation given to one player by his team to keep him from leaving via free agency. According to the CBA, the player is paid the average salary of the top five players at his position. Franchising a player does not mean a longer-term contract can still be negotiated.
Transitional Tag: The CBA also introduced us to the term “transition tag.” This lesser restriction provides only a right of first refusal, but no compensation. The one-year tender offer is equal to the average of the ten highest-paid players at the position.
Unrestricted Free Agents(UFA): Players with four years or more of NFL experience who can sign with their own team or any other team in the NFL. If they leave their previous team, the new team does not have to award the previous team compensation.
Restricted Free Agents(RFA): Players with three years of NFL experience. Like an unrestricted free agent, they are free to negotiate with any team, but the current team has the right to match any offer and retain the rights to the player. Failure to meet the offer means the player is awarded to the new team but the new team must give the old team compensation in the form of draft picks.
Exclusive-Rights Free Agents(ERFA): Players with two or fewer years experience, who do not have any outside negotiating power. Their rights belong to their previous club provided a minimum qualifying offer was made to them.
Franchise Free Agents(FFA): Unrestricted free agents designated as the "Franchise" player. The current team has the right to match any offer. If they refuse, the new team compensates them for the player.
Transitional Free Agents(TFA): Players who can negotiate with any club but current team retains matching rights.
Signing Bonus: The salary cap is flexible by allowing owners to pay signing bonuses up front that can exceed the salary cap number, but the bonus is amortized over the life of the contract.
Hope this helps weed through all the football speak!
Note of Interest: If there is not another extension to the current salary cap in 2011, the NFLPA has warned that they would never again agree to reinstate another salary cap.
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