A franchise tag in football is one year contract a team can impose on a player in order to stop them from becoming an unrestricted free agent.
Each NFL team only has one franchise tag and one transition tag per year. The purpose of a franchise tag is to allow teams to keep “franchise players” who are instrumental to their football team.
Players themselves dislike franchise tags as it stops them from negotiating a longer-term and potentially higher-paying contract in free agency.
How Do They Work?
A franchise tag works as a one year contract that the player must sign if they want to play football in the coming season. Additionally, the player and team are not able to negotiate the pay for this one year contract.
The player’s salary is determined by taking the top five salaries/cap hits of players at that position or 120% of the player’s salary the previous season.
Whichever of these two options is higher will be the player’s salary for the year he is franchised tagged.
The player must choose to sign his franchise tag and play out the season as usual otherwise they will be forced to sit out for the year.
There are several different types of tags that affect a players salary, ability to negotiate with other teams, and compensation if the player leaves.
The Three Ways To Tag A Player
Non Exclusive Rights Franchise Tag
The non-exclusive franchise tag is the most commonly used way to tag players in the NFL.
When a player receives a non-exclusive franchise tag he will be paid based on the top five salaries of players in his position over the last five years. Or 120 per cent of his previous salary whichever of the two are higher.
Additionally, when a player is given a non-exclusive franchise tag he is able to negotiate with other teams. If another team offers this player a contract his current team will have an opportunity to match that contract.
If they decide not to match the contract the player’s original team will receive two first-round picks as compensation for the player leaving.
Since two first-round picks are quite valuable teams will rarely sign a player that has been franchised tagged by another team.
Exclusive Rights Franchise Tag
An exclusive rights franchise tag is similar to the non-exclusive tag but there are a few key differences.
First off the salary of a player on an exclusive rights franchise tag is based on the top five paid players at the position in the last year. This is likely going to result in a higher salary than the non-exclusive franchise tag.
Additionally, players on an exclusive rights franchise tag are not able to negotiate with other teams.
The increased salary of players on this tag means it is not used as frequently. In most cases, an exclusive rights tag is used on players that teams would trade two first rounds picks for.
This way teams will pay more in salary in order to ensure their player is not poached by another team. The majority of the time this tag is used it is done on the quarterback position.
The transition tag is the final way in which a team can tag one of their players. This type of tag results in the player getting the average salary of the top ten players at his position.
Transitionally tagged players are able to negotiate with other teams. The original team has the right to match any contract offered to this player.
Though if they do not match the offer the original team does not gain anything in compensation.
How Many Times Can A Player Be Tagged?
Though it happens very rarely a player can be franchised tagged up to three times. This means hypothetically a team could force one of their star players to play on a one year contract three years in a row.
The reason that this is so rare is because of the massive costs teams must incur to keep a player for the third year.
When a team decides to tag a player a second time they will have to pay 120 percent of his first franchise tag salary.
When a team franchise tags a player for a third year they must pay out the player the highest of the following three options.
The average salary of the top five quarterbacks.
120 percent of average salary for the top five players at their position.
144 percent of his prior years salary.
Whichever of these three options is the highest will be the salary of the player who has been franchised tagged for the third year in a row.
This results in the player being very highly paid for a single year contract which usually makes this an option to avoid for general managers.
Can A Player Refuse A Franchise Tag
Technically speaking each player that is given the franchise tag has an option to refuse it though that means they would have to miss the football season.
Additionally, if a player fails to sign his franchise tag he will not be paid for the season. The player may also be subject to fines for not showing up to training camp, games, and workouts.
If a player is franchised tagged their best option is to attempt to sign a contract extension before the July 15th deadline. Otherwise, the player will have to accept the franchise tag or attempt to holdout for the season.