In March, the National Football League Player’s Association (NFLPA) decided against decreasing the maximum amount (3 percent) an NFL agent can charge his or her clients on performance contracts. However, the NFLPA announced Monday they are dropping the standard fee from 3 percent to a default fee of 1.5 percent.
The agent fee has been a hot topic since Russell Okung announced he would be negotiating his own contract with the Denver Broncos. Since the contract was met with much dismay from many people around the league, player representatives were confident the 3 percent agent fee would not be going anywhere anytime soon.
With the new rule, the maximum amount an agent can charge is still 3 percent of the contract, but the new default fee of 1.5 percent will force most agents to try and negotiate with their clients about a set agent fee.
NFLPA President Eric Winston told Sports Business Journal, “The ‘new’ form will change in this way: It will have some wording that will say that, unless agreed upon, the default language will be 1.5 percent. So basically the agent and player will both have to sign off on any fee change from the 1.5 percent. The new form will still have the boxes the old form had. The new form will just make it specific to each SRA [Standard Representation Agreement] that the fee has to be agreed upon.”
The ‘old’ SRA forms had boxes for 1 percent, 1.5 percent, 2 percent, 2.5 percent, 3 percent, and “other.” Multiple unnamed agents weighed in on the new contract rule.
One agent said, “As long as we don’t have to lower the fees, what you put on the SRA . . . . I don’t have a lot of anxiety over that. If that is the compromise for them not to lower the fees, then, I’m happy about it.”
However, a less-excited agent said, “If that becomes the standard, what agent in his right mind would choose football to represent, instead of baseball, which has totally guaranteed contracts where you can charge 5 percent, or basketball, with guaranteed contracts where you could charge 4 percent?”
As the NFLPA continues to make changes with agent fees, we may see more people leaving the already-saturated business, with less people trying to enter.