May
08

Drafting The Right NFL Contract: The Role Of A Sports Agent

The following is a guest contribution from Joanna Hensley, a teaching graduate assistant in the Tarleton State University Kinesiology Program. She is currently a contributing author for TSU’s Kinesiology and Sport Review. She will graduate in August with a master’s of education and pursue a law degree with plans for a career in football administration.

It is no secret that the multi-billion-dollar industry known as the National Football League (NFL) is profitable. Brunkhorst and Fenn (2010) simplified the generation of profits made by NFL teams as most significantly influenced by the gate receipts from games, broadcasts deals, and merchandise sales across the League. With game attendance acting as a prominent determinant in a team’s lucrativeness, much attention is poured into player salaries in an effort to put fans in the seats. Beyond operating costs, player expenses make up a hefty portion of expenditures endured by a professional football team.

With profit maximization at the forefront for each NFL organization, selective investment in up-and-coming players in the annual draft and the addition of free agents are crucial steps for the potential of spectator turn-out, jersey sales, and the variety of residuals associated with a profitable team. Months before draft selections are made the process is approached from a very different angle, that of the newly-declared professional athlete. The intricate process of contract negotiation begins with the initial step of a collegiate athlete declaring his intention to enter the NFL draft. From this point, the athlete and his newly-chosen agent enter into a whirlwind process meant ultimately to prepare him to become a professional, increase his draft stock, and ideally place him in the sights of a team looking to improve its profitability with his acquirement.

Steps to insure that agents are knowledgeable about the process have been heightened by the NFL Players Association’s requirement that potential agents pass a certification exam, which is offered yearly. Prerequisites include a bachelor’s degree as well as a master’s degree or an accredited law degree. The 60-question exam runs three hours, and content spans the Collective Bargaining Agreement, salary caps, player benefits, and steroid and substance policies in addition to any new, relevant League contract specifics (Agent Regulations, 2014).

Selection of an agent by an athlete—and, inversely an athlete by an agent—can be either instrumental or detrimental. Additionally, the role of the agent has evolved dramatically since the dawn of the NFL. Katrina Barrett (2010) describes the evolution of the agent’s role saying, “Although media relations are not always the responsibility of agents under contract, they are becoming a more integral part of the athletes’ careers and thus becoming more customary within the contract” (p. 7).

Research by Conlin, Orsini, and Tang (2013) revealed sports agent experience may not directly affect where these athletes’ compensations fall along the NFL’s “slotting process” alignment. According to the “slotting” concept, a player’s contract will be relatively smaller than the athlete drafted ahead of him and comparatively larger than the hopeful drafted immediately after him. However, the same research indicated that more experienced agents tend to navigate the negotiation process with valuable familiarity pertaining to allowances and exchanges that are common when finalizing contract terms.

The steps taken from the end of the athlete’s last collegiate season when he makes himself eligible for the NFL to the phone call on Draft Day in May can prove to be crucial for setting the tone of his career as well as establishing his financial future. As Conlin (1999) explained, “There is substantial information on players available for the NFL draft, which influence when and if a player is selected” (p. 291). Add to this the ever-accessible world of social media, the newest communication component that agents may influence, following these potential pros  until the attention focused on them is constant and meticulous.

As explained by Conlin, et al. (2013), once drafted a player is contacted by a representative of the drafting team in order to begin the process of contract negotiation (p. 277).Conlin, et al. suggested that players (and their agents) are wise to finalize contract negotiations efficiently because contracts are not guaranteed. This is where an experienced sports agent helps to navigate the dynamic atmosphere of rookie contract negotiation.

“The most important legal relationship for both an athlete and an agent is the player-agent relationship,” according to Barnett (2010, p. 2). And the relationship is homeostatic in nature. Just a critical as it is for the new professional athlete to hold trust in his agent, an equally important trust is needed from the perspective of the professional agent. Barnett put the balance of the relationship into perspective, asking how easy hinging the success of one’s career on the activities and decision-making of a professional athlete might be.

All the trust, negotiation expertise, and social monitoring reaches fruition in the finalization of the athlete’s contract. Doing so in a timely manner can prove to be crucial in the player’s assimilation into his new organization.

“Consider a player who signs a contract after the start of training camp,” wrote Conlin in his 1999 research exploring factors of separation across NFL contract negotiations. “Late to report to training camp, this player misses the opportunity to learn the team’s offensive or defensive system and fails to achieve proper conditioning, decreasing his probability of making the team” (Conlin, p. 289-290).

The steps taken publicly, physically, legally, and financially are crucial at this point in the athlete’s young professional career. Additionally, he relies on the knowledge of his designated agent to help him take the proper steps and avoid potential miscues. The role of the agent has grown from one of contract negotiations and dollars and cents to encompass a number of aspects in the path of a man new to the NFL.

An athlete placing his trust with the right NFLPA-certified agent enters the contract process, team activities, game field, and—let’s face it—the bank sooner.

Agent regulations. (n.d.). Retrieved from https://www.nflplayers.com/About-us/Rules–Regulations/Agent-Regulations.

Barnett, B. (2010). Sports agents and professional athletes: The legal relationships surrounding professional sports. Chicago-Kent College of Law, Retrieved from http://www.kentlaw.edu/perritt/courses/seminar/barnett Sports Agents and Professional Athletes by Katrina – Final Draft.pdf

Brunkhorst, J. P., & Fenn, A. J. (2010). Profit maximization in the national football league. Economics Letters, 26(1), 45-58. Retrieved from http://cluteonline.com/journals/index.php/JABR/article/viewArticle/276

Conlin, M. (1999). Empirical test of a separating equilibrium in national football league contract negotiations. RAND Journal of Economics, 30(2), 289-304. Retrieved from http://www.jstor.org/stable/2556081

Conlin, M., Orsini, J., & Tang, M. (2013). The effect of an agent’s expertise on national football league contract structure. Economics Letters, 121(2), 275-281. Retrieved from http://www.sciencedirect.com/science/article/pii/S0165176513003790