Lamar Jackson and the Baltimore Ravens couldn’t agree on a contract extension and Jackson is about to enter the final year of his agreement after the Ravens labeled him a franchise player. This franchise tag includes the Ravens’ right to match any other team’s offer for Jackson or receive two first-round picks if the Ravens decline and the offering team signs the player. With hundreds of millions of dollars at stake, Jackson has chosen to represent himself in the negotiations.
There have been a number of quarterback deals of late that have garnered a lot of public attention, including Deshaun Watson’s $245 million 5-year warrantee deal. Prior to last season, Kyler Murray was able to sign a five-year, $230 million contract with a $160 million guarantee. Josh Allen was given a $258 million contract with a $150 million guarantee, and Russell Wilson’s 5-year, $245 million contract included a $165 million guarantee.
Regarding guaranteed contracts, I’ve already written that the NFL is the only major sports league that doesn’t require guaranteed contracts, and players only receive their benefits in full after 4 years. This is no coincidence as NFL careers average less than 4 years and NFL quarterback careers only 3 years. This is a dangerous sport where a career-ending injury can happen at any time.
When I began my career representing NFL players, my first client was NFL Hall of Famer Ronnie Lott. At the time, the only part of the contract that was ever guaranteed was the signing bonus, not annual salaries. I contend that this conversation should be contentious since all NFL contracts should be fully guaranteed. Over time, certain portions of star players’ annual salaries have been guaranteed, but until recently things moved at a snail’s pace and Watson was the first to receive a fully guaranteed massive contract.
It’s important to put guaranteed contracts in perspective. They simply give team owners less flexibility to fire underperforming or injured players and take them off the books so they can hire other players below the salary cap. Teams would continue to receive aggregate revenue sharing provided by the CBA, which accounts for 53% of NFL revenue. Players would continue to receive the remaining 47% of revenue in the form of salaries. But teams don’t want to continue the books and pay underperforming players and give up flexibility on rosters and salary caps.
For the quarterbacks, however, the situation gets more complicated. It’s pretty clear that quarterback is the most important position in building a successful franchise, and when a star quarterback comes along, the natural reaction is to keep that player happy. This is how the fight for long-term guaranteed contracts arises. Quarterback guarantees have marched up from $165 million last summer to match DeShaun Watson’s $245 million fully guaranteed agreement, the first of its kind. Many owners viewed the Watson agreement as a huge mistake and insist that this error is not repeated. On the other hand, athletes and agents use this as a precedent that all contracts should be fully guaranteed, just like other major sports.
In the case of Lamar Jackson, representing himself in this complicated hornet’s nest is a particular challenge. Some athletes have been told they no longer need an agent because the collective bargaining agreement contains so many bargaining parameters, including minimum salaries, franchise labels and a salary cap. Jackson appears to have been convinced, or simply convinced himself, that he didn’t need anyone to represent him and appears to have relied on the informal advice of the NFL Player’s Association (NFLPA).
I shudder to think of Jackson portraying himself without first class professional advice and representation to guide the process from start to finish. Getting advice from the sidelines just isn’t enough to get the best result. Players are simply untrained in the tedious process of negotiating, assessing market conditions, understanding the intricacies of collective agreements, assessing risk, communicating effectively and making strategic and informed business decisions.
If you watch Jackson being interviewed, you will see this in full. Professional athletes are very emotional and those emotions are triggered when they aren’t getting what they think they rightly deserve and once that happens it becomes difficult to mend the gap. It goes beyond money and is related to feeling valued and respected by your team and often difficult to mend the relationship. A big part of a broker’s job is bringing home the client’s value proposition throughout the negotiation process and, while the two sides are apart, communicating the team’s position in the most diplomatic manner, leaving the door open for further discussion. Finally, the agent must make a judgment about what the best achievable outcome is, and then make a recommendation to the customer on whether or not to accept it. I would always present the final offer and then logically present a risk/reward analysis. When an athlete like Jackson represents himself and is told “no,” it can lead to an irrational reaction, a breakdown in communication, and a decision based only on emotion and not logic.
Additionally, there is a feeling among owners that guaranteed contracts shouldn’t escalate any further, even though the Deshaun Watson deal sets a new standard for top quarterbacks. It has been reported that no team will make him an offer and he has received advice from the NFLPA that he should wait for a fully guaranteed contract. He needs an agent who knows every owner and GM working from now through the start of next season to give them a true picture of their market value ie what a buyer/team is willing to pay for their services. If neither team makes an offer, Jackson faces a decision on whether to accept less than $250 million in guaranteed money.
On top of that, does the risk of him getting injured this year further complicate the Jackson scenario? Remember that Jackson is a running quarterback and this increases the risk of injury. He has been in the NFL for 3 years and has suffered various injuries. The level of such future risk can be weighed up through analyses. Rest assured that the team takes this into account to determine how much of their approval to guarantee.
The Ravens seem to think the range is between $160 million and $180 million. Should Jackson roll the dice and gamble for $32.4 million at age 26 with the possibility of risking nearly $150 million in guaranteed money if he’s seriously injured? It’s unlikely he could get injury insurance for that much. If there really aren’t any other offers for him, I’m not sure what to do. All I know is that if an “agent” advised him to take less than a $250 million guaranteed deal, that would probably be the last client he ever had, especially if Jackson was playing next year and one had breakout season and was bitter about it he was underpaid.
All of this player-rolling drama could be avoided if the NFL simply guaranteed all contracts, and perhaps limited the length of such contracts, like the other major sports leagues do. This would simplify the negotiation process and allow for a more emotionally intelligent relationship and culture between NFL owners and their players.