Site icon Sports Update

What is a Franchise Tag and when is it used?

NFL free agency is in sight, and the transfer market in the NFL will open again in less than a month. However, not all players whose contracts expire then actually come onto the market: teams have the option of keeping one player per franchise tag beforehand.

What is to be considered? What terms do you need to know for the coming days when it comes to distributing the tags?

A free agent in the NFL is anyone who has completed at least four “accrued seasons” in the NFL and whose contract expires at the end of a season.

An accrued season means a player has been on a team’s NFL roster for at least six games in a season. It does not matter whether the player was also part of the active squad on the day of the game or not.

However, the season is also counted if the player has been on the injured reserve list for at least six games.

However, a season does not count for weeks in a practice squad or if the player is on the Commissioner’s Physically Unable to Perform (PUP) List, Non-Football Injury (NFI) List, or Exempt List.

NFL: The Franchise Day Explained

If a team wants to prevent a potential star player from simply leaving the team and joining another team, but an agreement on a new long-term contract is not in sight, this player can be given the franchise tag.

There are several options here.

The non-exclusive franchise day

It should be noted here that there are two different franchise tags: the exclusive and the non-exclusive. The far more common is the non-exclusive. As a result, a player who signs it will receive a guaranteed one-year contract for the upcoming season.

However, a player tagged with this tag can still negotiate with other teams and even sign an offer sheet. In principle, an offer sheet is a contract that is valid in principle, but can still be viewed by the player’s previous team.

The previous team then has the choice: If it still wants to keep the player, then on the terms that the player negotiated with the other team on the offer sheet. The offer of the other team would therefore match and the player would remain with his previous team under the new conditions.

However, if the previous team refuses to match the offer in this scenario, the player switches to his new team. But as compensation, the player’s new team would then have to pass on their next two first-round picks to the losing team as compensation.

Similarly, the signing of a player who has received a franchise tag elsewhere is a very high price that goes well beyond the financial and is accordingly infrequent.

The exclusive franchise day

In the case of the exclusive franchise tag, on the other hand, the scenario just described does not apply. Here, too, the prospective free agent is bound for another year, but then must the player stay and is not allowed to negotiate with other teams. In that sense, he won’t become a free agent.

As compensation for him, however, his fixed salary is higher than that of the non-exclusive franchise tag.

NFL: The Transition Day

A team may also apply a transition tag to a free agent in lieu of the franchise tag. It is important to note that only one franchise or one transition day per year per team is possible.

Compared to the franchise, Transition Tag is somewhat less aggressive. The fixed salary for the player is lower and for other teams this hurdle is less daunting.

Should a player – via offer sheet – choose another team, the releasing team would not receive any compensation. The transition tag only grants the player’s previous team the “right of first refusal”, i.e. it can decide to match the offer sheet and thus keep the player.

In this respect, a transition tag only makes sense if a team is unable to negotiate a long-term contract with a player, but still has enough cap space not to be overwhelmed by an offer sheet.

NFL: The Restricted Free Agent Tender

Franchise and transition tags are intended for unrestricted free agents, meaning those who have completed at least four counting seasons in the league. Four years is the length of a standard rookie draft pick contract.

However, those who were not drafted and only then signed as an undrafted rookie free agent usually only receive a three-year contract. When this expires, the player becomes a restricted free agent, just like other players with only three credited seasons.

This means that although he is technically a free agent, the rights to the player still belong to the previous team. Said teams then have the option of negotiating a long-term contract with the player, letting him go, or placing a restricted free agent tender on the player.

There are four different ones with a correspondingly higher salary: A first round tender, a second round tender, an original round tender and one that only grants the right of first refusal. Here, too, other teams can then offer offer sheets, which are either matched by the current team or not.

If a team then loses such an RFA, it will receive a corresponding draft pick as compensation for the first, second and original round (the round in which the player was drafted) tender – i.e. depending on which of them they gave the player.

NFL: Franchise Tag and RFA Tender Deadlines

Beginning February 21st, teams will have the option to tag one of their players with the Franchise or Transition tag. The deadline for this is March 7th.

The deadline for the RFA tenders is April 21st, while there is until April 26th to match an offer sheet.

Another important off-season deadline is July 15 each year. Until that day, players who have received the Franchise Tag can sign a long-term contract.

If this period elapses, the player can only play the coming season under the fixed one-year contract and only conclude a long-term deal again in the following offseason.

NFL: Salary for Franchise Tag, Transition Tag, RFA Tender

The salary for Franchise Tag, Transition Tag and the RFA Tender is determined each year according to a central key and, in the case of the first two, differentiated according to the position of the player.

Franchise tag salary is based on average of top 5 cap hits by position, Transition tag salary is based on average of top 10 cap hits by position.

The whole thing is linked to the applicable salary cap and the development of this over the previous five seasons.

However, there is one point to consider: A player cannot be worse off in terms of salary than in the previous year as a result of a Franchise Day. This means that he must receive at least 120 percent of his previous year’s salary. Should this 120 percent of the previous year’s salary exceed the tag number, those would have stock and not the officially established standard salary.

As far as the exclusive franchise tag is concerned, the average of the actual top 5 salaries for the coming season is set here for the respective position. The deadline for this is in April, so it is currently still unclear what a player would earn with such an exclusive franchise tag. The only candidate for that day is quarterback Lamar Jackson from the Baltimore Ravens in 2023.

Exception: Franchise Tag for several years in a row

It should also be noted that a player who receives the franchise tag twice in a row also receives 120 percent of his previous year’s salary.

If a player is retained for the third year in a row per franchise tag, he would be entitled to 144 percent of the previous year’s salary.

When calculating the salaries for the RFA tender, the respective figure for the previous year is adjusted to the same extent as the change in the salary cap compared to the previous year. So in the 2023 season this will mean an increase in salaries.

The salary cap for the 2023 season was raised again significantly compared to the previous year: After $208.2 million, teams now have $224.8 million at their disposal.

And that in turn leads us to these salaries for the respective tags and tenders:

NFL: Franchise and Transition Day Salaries 2023

position Franchise Day (dollars) Transition Day (dollars)
quarterback 32,416,000 29,504,000
Defensive end 19,727,000 17,478,000
wide receivers 19,743,000 17,991,000
linebacker 20,926,000 17,478,000
cornerback 18,140,000 15,791,000
offensive line 18,244,000 16,660,000
Defensive tackle 18,937,000 16,068,000
security 14,460,000 11,867,000
running back 10,091,000 8,429,000
tight end 11,348,000 9,716,000
special teams 5,393,000 4,869,000

NFL: RFA Tender 2023

Type total
first round 6,838,000
second round 4,901,000
Right of First Refusal 2,992,000

Exit mobile version