We’ll get to the more esoteric parts of the salary cap
With the New York Jets’ offseason moves drawing ever nearer, we’ve been going through some of the key salary cap terms you need to understand. In this part of the review, we’ll cover a few more parts of the cap that you may have heard something about but don’t fully understand.
- Part 1: Basic contract structure
- Part 2: Contract restructures
- Part 3: Trades
- Part 4: Franchise tag
- Part 5: Compensatory picks
- Part 6: The mysterious June 1
Expiring contract
This is just a quick nugget for Jets fans looking at the team’s cap situation.
The Jets’ cap situation for 2024 already subtracts the players whose contracts are expiring. Currently, Over the Cap lists their 2024 cap space at $4.97 million. The expiring contracts of Carl Lawson, Jordan Whitehead, Mekhi Becton, etc. will not change that since they are not under contract in 2024.
Accrued season
An accrued season is a season that counts toward NFL free agency. It is earned if a player is on a team’s 53-man roster, injured reserve list, or PUP list for at least six regular season games in one year.
Jarrick Bernard-Converse accrued a season this year because he was on the Jets’ PUP list for more than six games.
Types of free agents
Unrestricted free agents
Most NFL free agents become unrestricted free agents (UFA), meaning they are free to sign with any team without any restrictions. There are exceptions, though.
Restricted free agents
A player who has exactly three accrued seasons and an expired contract becomes a restricted free agent (RFA). This means that their team has five options:
- Decline a tender, in which case the player becomes a UFA.
- Place a first-round tender on the player, which will be worth approximately $6.5 million in 2024. Other teams can sign the player to an offer sheet, in which case the original team can choose to either match the offer or let the player go in exchange for a first-round pick.
- Offer a second-round tender, which is worth an estimated $4.6 million in 2024 and gives the same right to match an offer or receive a second-round pick as compensation.
- Offer an original-round tender, which would return the same draft pick as the player’s original draft round if the team does not match the offer. (An undrafted free agent cannot receive an original-round tender).
- Place a right of first refusal tender on the player, worth $2.83 million, which means that the tendering team has the right to match any offers but will receive no compensation if they decline to match.
Bryce Huff became a restricted free agent in 2023 because his three-year contract had expired and he had three accrued seasons. The Jets placed a second-round tender on him, and no one else offered him a contract. Huff played the 2023 season on the $4.304 million tender and is now a UFA.
Exclusive-rights free agents
A player who has an expired contract and fewer than three accrued seasons becomes an exclusive-rights free agent (ERFA). Their current team can tender them a contract for the league minimum amount based on their number of accrued seasons. They cannot negotiate with other teams unless the tender is declined.
For example, the Saints’ Rashid Shaheed is an ERFA in 2024. Shaheed has only two accrued seasons, but his contract is expiring. Therefore, the Saints will have the right to tender him a contract for $985,000, the league minimum amount for a player with two accrued seasons. Considering that Shaheed posted 46 catches for 719 yards and 5 touchdowns in 2023, the Saints are all but guaranteed to tender him.
Incentives vs. escalators
A player’s contract can include two different ways to earn extra money based on performance: incentives and escalators.
An incentive will increase this season’s salary if the player hits certain playing time or performance benchmarks. Dalvin Cook had $1.62 million in performance incentives in his Jets contract, which he did not meet.
An escalator will increase next year’s salary if the player hits certain playing time or performance benchmarks this season. Geno Smith’s Seahawks contract included $30 million in escalators for repeating his 2022 performance benchmarks (passing yards, touchdowns, etc. as specified in the contract).
In the 2023, I floated the possibility of the Jets offering a contract extension to Becton with both escalators and incentives. These were the escalators and incentives.
- $1.5 million 2024 escalator for playing at least 75% of the team’s offensive snaps in 2023 (achieved)
- $1 million 2024 escalator for making the Pro Bowl in 2023 (not achieved)
- $1.5 million 2024 incentive for playing at least 75% of the team’s offensive snaps in 2024
- $1 million in 2024 incentives for making the AP All-Pro team (first or second team) in 2024
(Becton may or may not have accepted such an offer, but the Jets are lucky they did not offer it based on his actual 2023 performance. My proposal was foolish in hindsight.)
Likely to be earned vs. not likely to be earned
How do incentives count for cap purposes? Are they included in this year’s cap calculations or not?
There are two different classifications for incentives: likely to be earned (LTBE) or not likely to be earned (NLTBE). An LTBE incentive is an incentive based on a performance benchmark that the player achieved the season prior, while an NLTBE is based on a benchmark they did not achieve the season prior. LTBE incentives count against this season’s cap at the beginning of the year, while NLTBE do not.
(Escalators are irrelevant because they count toward the next season’s cap, so by the time cap calculations come around, the escalator will have either been earned or not earned.)
For example, Cook’s incentives included $400,000 for 1,250 rushing yards and $400,000 for 1,500 yards from scrimmage. Since Cook did not have 1,250 rushing yards the season prior (he had 1,173 in 2022) and he did not have 1,500 scrimmage yards (he had 1,468), both of these were considered NLTBE incentives and did not count against the Jets’ salary cap.
If an LTBE incentive is not earned, the NFL will credit the team toward the next season’s cap. If an NLTBE incentive is earned, the NFL will charge the team toward the next season’s cap. In the Jets’ case, Cook did not earn the incentive and it was NLTBE, so nothing changes for the Jets’ cap.
