NFL Minimum Salaries & Veteran Discounts

With team’s letting go of veteran contracts this time of year in order to set themselves up with salary cap room heading into free agent season, we’ll take a look at a few contract components that help understand how players being signed in the coming months might be compensated.
 

Minimum Salaries

Each year the NFL mimum salaries increase by $15,000, up to $435k for a rookie in 2015. A player’s minimum salary is determined by his years of experience (YOE), ranging from 0 to 10 or more.

Reserve/Future Contracts
The majority of Reserve/Futures contracts, as well as nearly all Undrafted Free Agent signings this summer will include a minimum salary base contract. In the 2015 season that would include a salary of $435,000 in 2015, $525,000 in 2016, and if applicable $615,000 in 2017.
 
 

Veteran Minimum Salary Benefit Rule

When qualified, a player with more than two years of NFL experience can earn his total minimum salary, but have a cap figure that reflects two years of experience – or in 2014, $570,000. The contract must be for only one year, and must not contain combined bonus money (signing, roster, workout) that exceeds $65,000.
 
For instance, Shayne Graham recently re-signed with the New Orleans Saints on a 1 year $955,000 contract. With more than two years of experience (12), and a 1 year contract, Graham qualfies for the cap hit benefit. His 2014 cap figure will be $570,000 in New Orleans.
 
Had he received a signing bonus of the maximum $65,000, he would have received a $1.02 million contract, with a $955,000 base salary, a $65,000 signing bonus, and a cap figure of $635,000 (570+65).
 
With plenty of veterans being released, or not signed back thus far in 2014, the use of the Minimum Salary Benefit Rule becomes useful both for older players looking for jobs, and teams looking to minimize their cap dollars.
 
 

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Article by: Michael Ginnitti