NFL Free Agency: Everything You Need to Know

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Andrew Burton/Getty Images

The new NFL season is rapidly approaching, but we’re well into the new NFL league year. Confused? The start of the new league year also signifies the start of free agency — in case you needed a refresher before your fantasy draft or your season tickets arrive, don’t worry, we’ve got you. The annual free agency period is the first chance for teams to work toward improving their rosters from the previous season. The first wave of free agent signings usually revolves around big-name, Pro Bowl-caliber players who sign huge, multi-year contracts. After that, teams use the free agency period to fill holes with reasonably priced veterans before they move on to the NFL Draft.

In an effort to ease the understanding of the nuances and rules of NFL free agency as they are laid out in the league’s Collective Bargaining Agreement (CBA), we have compiled a cheat sheet of key terms, key dates, and notable roster distinctions that will be thrown around by teams and the media in the coming days, weeks, and months. To start, it is important to define what constitutes an accrued season and what constitutes a credited season in the NFL.

Accrued vs. Credited seasons

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Roger Goodell poses with the latest CBA |  Michael Loccisano/Getty Images

Accrued season

An accrued season is defined as any season in which a player is under contract at full pay status for six regular season games. Full pay status includes the active and inactive rosters and the Injured Reserve list. Accrued seasons apply to free agency, and are the determining factor in a player’s status as an unrestricted free agent versus a restricted free agent. Any player with one accrued season is considered to be a veteran.

Credited season

A credited season is defined as any season in which a player is under contract at full pay status for three regular season games. Again, full pay status includes the active and inactive rosters and the Injured Reserve list. Credited seasons are used for determining pension eligibility and amount as well as determining a player’s minimum salary eligibility. With three or more credited seasons, players are vested and eligible to collect a pension.

Restricted vs. Unrestricted Free Agents

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John Elway has a reputation for being a smart General Manager | Doug Pensinger/Getty Images

Restricted free agent

A restricted free agent (RFA) is a veteran player with three – but no more – accrued NFL seasons. An RFA is eligible to sign with another franchise, but his current franchise is given Right of First Refusal on any contract the player may receive on the open market. Additionally, the player’s current team may receive Draft Choice Compensation – which depends on the level of contract they tendered to the player – if they choose not to match the player’s free agent contract.

Draft Choice Compensation is dependent on the tendered contract offer from the player’s current team. The possible tenders include first round, second round, original round, and Right of First Refusal only.

Unrestricted free agent

An unrestricted free agent (UFA) is a veteran player with four or more accrued NFL seasons, or who is not subject to Right of First Refusal or Draft Choice Compensation.

Exclusive rights free agent

An exclusive rights free agent (ERFA) is a veteran player with less than three accrued NFL seasons. An ERFA is limited to either signing the contract tendered to him by his current team, or not playing in the NFL that season. If a team chooses not to tender a contract to an ERFA, he becomes an unrestricted free agent.

Franchise tags

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Franchise tags are designed to let teams hang on to their star players | Mitchell Leff/Getty Images

The franchise tag, which is dreaded by players, is available to teams to use on either an UFA or a RFA. At its roots, the franchise tag is designed for teams to maintain the rights to one of their free agents for at least one more season. Here is a look at the types of franchise tags that teams can use.

Exclusive rights franchise tag

If a team uses an exclusive rights franchise tag on a player, the player can either sign the tender, or not play in the NFL that season. The value of the exclusive rights franchise tag is the greater or either the average of the top five salaries in the league at the player’s position, or 120 percent of the player’s salary from the previous season.

Non-exclusive rights franchise tag

If a team uses the non-exclusive rights franchise tag on a player, then the player is free to sign with another team in exchange for two first round draft picks being sent to his prior team. Calculating the value of the non-exclusive rights franchise tag is much more complicated than that of the exclusive rights tag. More details can be found here.

Transition tag

The transition tag is available to teams that have not used their franchise tag. If used, it gives teams Right of First Refusal on any free agent contract offers a player may receive on the open market, but offers them no compensation if they choose not to match the contract offer.

Contract Bonuses

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Steve Smith’s last contracts were full of bonuses and incentives | Mike Ehrmann/Getty Images

Roster bonuses

Roster bonuses are popular among teams with a lot of salary cap space, and in high-value, multi-year contracts. They are also used when teams re-negotiate deals to free up salary cap space. Roster bonuses are lump sum payments, typically kick in on a specific date, and count entirely against that year’s salary cap. Unlike other bonuses written into contracts, roster bonuses are not always guaranteed.

Signing bonuses

Unlike roster bonuses, signing bonuses are prorated over the life of the contract, and are fully guaranteed. Most players who sign NFL contracts receive signing bonuses that can range in value from four figures up to eight figures.

Workout bonuses

Workout bonuses are common in NFL contracts. They rely on players being in attendance for a pre-determined percentage of his team’s offseason workout program.

Performance incentives

Performance incentives are written into contracts to encourage players to exceed expectations. These incentives can be worth anywhere from thousands to millions of dollars.

Performance incentives fall into two categories: “likely to be earned” and “not-likely to be earned.” Likely to be earned incentives automatically count toward the team’s salary cap, and if the incentive goes unearned, the team will receive a salary cap credit that will be applied toward the next season’s cap. Not-likely to be earned incentives do not count against the salary cap unless the player earns the incentive.

Performance escalators

NFL contracts often have escalators written in to reward players for exceeding expectations. If a player achieves a specific incentive they receive a raise in their salary for the following season.

Salary cap terminology

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It’s important to know exactly what the words mean | Rob Carr/Getty Images

Dead money

Dead money is salary cap space that must be allocated for a player who was either released or traded. It is used to account for all money that has been paid out to a player that has not already been reflected in the salary cap.

Salary cap rollover/carry-over

As a part of the CBA that went into effect in 2011, teams now “have the ability to carry over any remaining salary cap room from one year to the next by submitting written notice, signed by the owner of the team, to the league office no later than 14 days before the start of the next league year.” The written notice must also include the exact amount of cap space the team wishes to carry over.

Rookie salary pool

This figure simply accounts for the salary cap costs associated with signing each draft pick that a team has – barring any trades – leading up to the NFL Draft.

Top-51 rule

The top-51 rule states that the only the top-51 salaries for each team count toward the offseason salary cap.

June 1 roster designation rules

If a player is released prior to June 1, his remaining salary cap obligations are immediately applied to that year’s cap in full. If a player is released after June 1, his salary cap obligations are split up between the current year and the following year.

Under the new CBA, teams can now designate two players as June 1 roster cuts prior to June 1 for salary cap purposes.

2017 NFL Offseason Calendar

Ronald Martinez/Getty Images
Ronald Martinez/Getty Images

February 15: First day for teams to designate franchise or transition players

March 1: Deadline for teams to designate franchise or transition player by 4 p.m. eastern time

March 7-9: Teams are permitted to contact and negotiate with the agents of players who will become unrestricted free agents at the start of the new league year.

March 9: Teams have until 4 p.m. eastern time to exercise options for all players with 2017 option clauses in their contracts, and must also have qualifying offers submitted to all RFAs and ERFAs they wish to have Right of First Refusal on.

March 9: The Top-51 rule comes into effect. Teams must have their top-51 contracts under the 2017 salary cap by 4 p.m. eastern time.

March 9: All 2016 NFL contracts expire at 4 p.m. eastern time.

March 9: The new league year, the start of free agency, and the 2017 trading period all begin at 4 p.m. eastern time.

April 21: Deadline for RFAs to sign offer sheets

April 27-29: 2017 NFL Draft in Philadelphia