One of the big issues for the owners was establishing a rookie wage scale and a salary cap for rookies, and it appears that both sides have agreed on that particular point in the deal.
Based on an NFLPA memo from last week, obtained by ESPN, the league and the players were in agreement on an overall structure that would fix rookie contracts at four years, with a team option for a fifth year for first round draft picks.
The example used in the presentation stated that a number one overall quarterback, like Cam Newton this year, will receive a contract of $22 million over the first four years, plus a team option for a fifth year at a salary likely to be approximately $14.3M. Compare Newton’s proposed contract of $36 million, with $22 million guaranteed, to last year’s number one – Sam Bradford signed a six-year, $78 million deal with the Rams, $50 million of which is guaranteed.
Newton’s contract is likely to be less than half the value of what Bradford signed.
This structure is designed to limit the growth of salaries of unproven rookies at the top end of the draft, which helps minimize the exposure of poor team drafting high and betting the future on one player. Since the overall formula for sharing revenue with the players doesn’t change, this should also translate to more dollars being available for veteran free agents.
One interesting side note – the salary for the fifth year would be dependent upon where the player was taken in the draft. For rookies drafted in picks 1 through 10, the salary for the fifth year would be based upon the top 10 players at that player’s position. For picks 11 through 32, the salary would be based upon an average of the 3rd through 25th players at their position.
This creates a salary bubble between picks 10 and 11. Using 2009 salary data from USA Today as a basis, a quarterback picked number 10 overall would have a fifth year option worth about $14.5 million. If that same quarterback were taken one pick later, his option year would be worth $10.4 million. That’s a big step for one draft slot. It will be interesting to see how teams around the bubble respond in the first draft under the new rookie salary rules.