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Maryland Client Advocates Since 1950

NFL contract guarantees can be very complex

In some sports, players are simply given a guaranteed contract. If they sign their rights to a certain club for four years, for example, they are then paid exactly the amount of money on the contract. No matter what happens, they know that they’ll have that annual salary for the next four years, and then they can re-negotiate a contract with that club or move to a different club.

That type of thing may be common in the NBA or the NHL, but it doesn’t happen nearly as often in the NFL. The contract guarantees do still exist, but they can be pretty complex and they don’t often mean what you would expect.

Partial guarantees

For one thing, players will sometimes be given an overall contract number and then a lower total that is a partial guarantee. An example of this could be Dallas Cowboys quarterback Dak Prescott, who once signed a $160 million contract over four years. But only $126 million of this was guaranteed.

In some situations, teams will guarantee money for injury, but not for anything else. If the player suffers a serious injury, they still get to keep their contract. But if they just get cut because they’re not performing, the club doesn’t owe them any money.

In other situations, guarantees will be put at the beginning of the contract, and the team has an option on the back end of the deal. So it might be a five-year deal with a certain amount of money guaranteed, but those guarantees could run out after the first three years. The player could then be cut from the team with no detrimental impact on the team’s salary cap and with no obligation to pay the rest of the contract – even though they initially signed for two more years.

Athletes in any sport absolutely need to know how contracts work, what money is guaranteed and what to expect. When these discussions get to be complicated, they also need to know about all the legal options at their disposal.