PFR Glossary News & Rumors

Here at Pro Football Rumors, you’ll see a number of stories posted on players being cut, waived, or released by their NFL teams. While these terms are often used interchangeably, they’re not quite synonymous. A player who is “cut” has been removed from his team’s roster, but whether he is “waived” or “released” generally depends on his NFL experience.

Between the day after the Super Bowl and the following season’s trade deadline, players with less than four years of service time – or “accrued seasons” – have to pass through waivers after they’re cut by an NFL team. The other 31 clubs around the league have a day to place a waiver claim on that player, adding him to their roster and taking on his contract. That’s why we refer to these players as having been waived, rather than released.

If a player with more than four years of service time is cut between the Super Bowl and the trade deadline, he is not subjected to the waiver process, meaning he becomes a free agent immediately, able to sign with a new team right away if he so chooses.

This isn’t the case all year round, however. Once the trade deadline passes, any player who is cut by his team must pass through waivers, regardless of how many accrued seasons are on his résumé. So if a team cuts loose a 12-year veteran in Week 10 of the season, that player must pass through waivers unclaimed before he’d be free to sign with a team of his choice.

Here are a few more details on the waiver process:

• If two teams place a waiver claim on the same player, he is awarded to the team with the higher priority. Waiver priority is determined by the previous season’s standings — this year, for example, the Cardinals have first dibs, while the Super Bowl champion Patriots have 32nd priority.
• However, the waiver priority order will change starting in Week 4. At that point, waiver priority is determined by records of the current season.
• The window to claim a player closes at the end of the NFL’s business day, which is at 3:00pm central. So if a player is waived by one team on Monday, the other 31 clubs have until Tuesday afternoon to submit a claim. Players cut on Friday clear waivers (or are awarded to a new team) on the following Monday.
• Prior to the first cutdown date in training camp, injured players with fewer than four years of service time cannot be placed on injured reserve until they pass through waivers. Teams will cut this sort of player with a waived-injured designation, allowing other teams to place a claim if they so choose. If the player goes unclaimed, his team can place him on IR or agree to an injury settlement, then fully release him from the roster.

Note: This is a PFR Glossary entry, modified from a previous post by Luke Adams. Our glossary posts explain specific rules relating to free agency, trades, or other aspects of the NFL’s Collective Bargaining Agreement.

When an NFL team finds itself short on cap flexibility and in need of some space, one of the most effective short-term fixes is to restructure a player’s long-term contract. While cutting or trading players can often be solutions as well, a contract restructure allows the team to keep its roster intact while also providing immediate cap relief.

The base salaries of NFL contracts typically aren’t guaranteed, but players can receive guaranteed money in the form of signing bonuses. While those bonuses are considered to be up-front payments, for cap purposes they can be spread out over up to five years of the contract. For instance, if a player were to sign a four-year deal with a $12MM signing bonus, that figure would prorate equally over the four years of the contract, amounting to a $3MM cap hit per year. If a team were to release that player one season into the deal, the club could avoid paying most of the player’s annual base salaries, but would still be on the hook for the remaining bonus money, along with the cap total for that money.

As such, the most common form of contract restructuring involves converting a portion of a player’s base salary for a given year into a new signing bonus. That bonus can then be spread out over several years, moving it away from the current season.

This is exactly the sort of agreement the Vikings and linebacker Eric Kendricks reached this offseason. In 2018, the Vikings signed Kendricks to a five-year, $50MM deal. This year, the Vikes moved some of that cash around to give themselves breathing room under the cap. Minnesota converted $2.15MM of Kendricks’ $4.15MM salary for 2019 into a salary bonus, which created about $1.72MM in space.

Restructuring a contract by converting base salary to a signing bonus creates immediate relief, but also creates problems in future years. A year from now, the Ravens may have to make another move with Kendricks, which will likely mean restructuring his deal once again, to reduce a larger cap number for 2019.

There are ways a player can remain under contract with a team while also helping to create or maintain both short-term and long-term cap flexibility. A player agreeing to take a pay cut, for instance, could allow a team to reduce his current cap number without necessarily moving that money further down the line in the contract. However, that generally happens in situations in which the team’s leverage outweighs the player’s leverage.

In most cases then, a restructured contract that sees base salary converted into bonus money is the simplest short-term fix for a club. The bill will come due eventually, but restructuring a deal allows a team to put off a more significant decision for at least one more year.

Note: This is a PFR Glossary entry. Our glossary posts explain specific rules relating to free agency, trades, or other aspects of the NFL’s Collective Bargaining Agreement. Information from Joel Corry and Over the Cap was used in the creation of this post.

Tons of veteran players were cut before the start of the season, and while different clubs had different reasons for shuffling their rosters, the looming vested veteran guarantee may have played a part in many of those moves. Vested veterans – players with at least four years of NFL experience – had their 2018 base salary guaranteed for the year by being on an NFL team’s roster for the first game of the season.

That means that if a team decided after Week 1 to part ways with a veteran player with a 2018 base salary of $1MM, the team would still be on the hook for that full $1MM, which would count against the cap. A veteran who has received this form of termination pay in the past wouldn’t be eligible to receive it again, but otherwise the player can put in a claim for his full salary and receive it. Veterans not a Week 1 roster don’t benefit from that provision, however.

If a player is signed during the season, following a team’s first game, and is later released, he’s only entitled to 25% of his full-season salary. For instance, let’s say a team signed a player in Week 2 for a full-year salary of $1.02MM. First, that salary would be prorated for 16 weeks, meaning it’d be worth $960K. If a player is cut shortly after signing, he’d receive 25% of that amount, or $240K. If the player is released within four weeks of signing, he’d only count for $240K against his team’s cap, rather than the amount of his full salary.

Ultimately, the Labor Day weekend numbers crunch is about much more than talent-based decisions. Teams are mindful of expenses and potential dead money hits, particularly when they’re tight against the cap. The smaller vested veteran guarantees may seem like a drop in the bucket when compared to a $177.2MM cap, but every dollar counts for clubs with less than $2MM in breathing room such as the Vikings, Patriots, and Rams.

Already this season, we’ve seen several key players moved to teams’ injured reserve lists. 49ers quarterback Jimmy Garoppolo, Packers defensive tackle Muhammad Wilkerson, and Patriots running back Rex Burkhead are among the players who landed on the IR recently, opening up a spot on their clubs’ active rosters for their teams to replace them. 

The injured reserve designation is generally used for players who will be out for the season. That’s not the case for every player who lands on injured reserve though. Particularly during the preseason, we see players who weren’t part of their teams’ long-term plans hit the IR list, only to be cut several days later. Generally, these cases involve players who aren’t suffering from season-ending injuries, and receive injury settlements from their respective clubs in order to release those clubs from any liability.

For instance, let’s say a player is injured during the final week of the preseason with a high ankle sprain, and the player and team both agree that the injury will sideline him for three weeks. The club could place that player on injured reserve, then cut him with a two-week regular-season injury settlement (since the final preseason week is also taken into account). That would allow the player to receive 2/17ths of his season salary, and allow him to look for work with a new club when he gets healthy. If the club were to keep the player on injured reserve rather than removing him with a settlement, it would be required to cut him when he gets healthy.

Teams who release a player from IR with a settlement are eligible to re-sign that player later in the season, if they so choose. But they must wait three weeks, on top of the time of the initial settlement. In that previous example then, a club would have to wait until after Week 8 to re-sign the player with the high ankle sprain.

Players who remain on their clubs’ injured reserve lists all season continue to receive their full salary, which also counts against their teams’ salary caps. The 49ers, for example, have tons of traditional dead money on the books thanks to the contracts of NaVorro Bowman, Vance McDonald, and Jonathan Cooper. But, they’re also effectively carrying dead money for Garoppolo, who carries a $37MM cap number in the first year of his lucrative extension.

In some instances, players agree to “split contracts” when they sign with a club, which means that the player will receive a smaller salary if he lands on injured reserve. Split contracts, which are worth less than the active roster minimum salaries, are fairly rare, and are primarily signed by undrafted rookies or veterans with injury histories.

One additional quirk related to the injured reserve list is the option each team has to bring two players back from the IR list. The rule has changed quite a bit over the last few years. Previously, the rule stipulated that a team had to designate one specific player for return later on in the season. The IR-DTR spot was later nixed to allow teams to bring one player back from IR without any previous designation, but starting in 2017, teams were permitted to return two players from IR. The only hitch is that a player must be on IR for a minimum of six weeks before practicing and can return to game action after a total of eight weeks.

Note: This is a PFR Glossary entry, modified from an earlier post by PFR editor emeritus Luke Adams. Our glossary posts explain specific rules relating to free agency, trades, or other aspects of the NFL’s Collective Bargaining Agreement. Photo courtesy of USA Today Sports Images.