Thursday, 9 July 2009

Bad decisions and salaries

The guys who work in the NFL have a pretty unique salary payment structure and position.

In the Premiership the players have contracts which range anywhere from 1 year to a decade, and the wage values you hear about in the papers are the actual amounts they will earn on a weekly basis for the whole of their contracts. They aren't game cheques (amounts per week of the season) they are actual payments.

The same is basically the same in the rugby, except that rugby clubs are operating under a salary cap and recognise that the value of the player contract as an asset is a lot more fungible. This means that even established international players can be playing under one or two year deals. The old amateur ethos of the game means that the players are still at a point where (for the most part) they're glad to be being paid to go to the club, and not having to work the jobs they would otherwise be filling (this excludes the guys like Jamie Roberts, who's studying to be a doctor, and the guys who use rugby to pay for being an eternal student).

In the NFL annual salaries are paid on a weekly basis for the period of the season, with bonus cheques paid in the post season at a much lower rate. The good part of the salary of an NFL star is the up front cash lumps, which are pro rated for salary cap purposes, but are a real pain (one assumes) to manage cash wise. The players who hit it big get a massive influx of cash, and given the 8 years average career of the NFL player, need to invest wisely.

This story from the National Football Post, which I've seen mooched about for the last couple of days, is a case study in what not to do. Of course, the MLB has the same problem (see Moneyball for Billie Beane's sad story).

I'll probably witter on about salary cap stuff later - Profootballtalk is a pretty good place to start with any contract details.

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