Restricted free agent
Encyclopedia
A restricted free agent is a professional athlete who plays in the KHL, NFL, NHL, or NBA. Such players have special restrictions on the terms under which they can retain or change employment status with their athletic club teams.
, a restricted free agent (RFA) is one with three accrued seasons of service, who has received a "qualifying" offer (a salary level predetermined by the Collective Bargaining Agreement between the league and its players) from his current club. He can negotiate with any club through a certain date. If the restricted free agent accepts an offer sheet from a new club, his old club has "right of first refusal," a seven-day period in which it may match the offer and retain him, or choose not to match the offer, in which case it may receive one or more draft picks for the upcoming draft from the player's new club. If an offer sheet is not executed, the player's rights revert to his old club the day after negotiations must end.
Each player that signs a tender receives the one-year salary that corresponds to the tender level. Teams which choose not to match an offer on a player with a low tender receive a draft pick corresponding to the round in which the player was originally drafted (except that the highest pick that can be surrendered for such a tender is a second-round pick). For example, a player who was originally drafted in the sixth round of the NFL Draft
would force the team signing him to give his former team a sixth-round pick in the upcoming draft as compensation for his service. No compensation is required for an undrafted player on the lowest tender amount, so teams with valued undrafted RFAs are taking a notable risk by offering such tenders.
Players who earned less than $660,000 in the previous season must be offered 110 percent of last season's salary. Players making up to $1 million must be offered 105 percent. Players making over $1 million must be offered 100 percent.
For example:
At any point during the negotiation process, if the player has been in the NHL for longer than 4 years (less if the player signed his first contract after the age of 20), either the player or his current team may file for Salary Arbitration as a means of settling a contract dispute. At this point the player may no longer sign an Offer Sheet. The deadline to file for Salary Abitration is July 5th with cases being heard between late July and early August.
A team can take a player to arbitration once in his career. Players may request salary arbitration as often as they please.
Restricted free agency exists only on a limited basis. It is allowed following the fourth year of rookie "scale" contracts for first round draft
picks. It is also allowed for all veteran free agents who have been in the league three or fewer seasons. However, a first round draft pick becomes an unrestricted free agent following his second or third season if his team does not exercise its option to extend the player's rookie scale contract for the next season. All other free agency is limited to unrestricted free agency.
The amount of the qualifying offers are, for players on rookie "scale" contracts, based on the player's draft position. For all other players, it is the greater of the following:
The qualifying offer must be for one season. A player can elect to accept his qualifying offer (the qualifying offer must be accepted by March 1) and play the following season under its terms. This is sometimes done in order to become an unrestricted free agent the following summer.
If the deadline passes and the qualifying offer is neither withdrawn nor accepted, then the player continues to be a restricted free agent. The team and player are also still free to negotiate a new contract after the qualifying offer ends - the deadline only affects the player's ability to accept the qualifying offer.
players under 28 years of age as of July 1 of a given calendar year whose contracts are expired are considered restricted free agents. Just like the NHL and the NBA, the original team of a player who signed an offer sheet tendered by another team has seven days to match the offer sheet. However, unlike its North American counterpart, teams that decide not to match offer sheets collect transfer fees instead.
NFL
In the National Football LeagueNational Football League
The National Football League is the highest level of professional American football in the United States, and is considered the top professional American football league in the world. It was formed by eleven teams in 1920 as the American Professional Football Association, with the league changing...
, a restricted free agent (RFA) is one with three accrued seasons of service, who has received a "qualifying" offer (a salary level predetermined by the Collective Bargaining Agreement between the league and its players) from his current club. He can negotiate with any club through a certain date. If the restricted free agent accepts an offer sheet from a new club, his old club has "right of first refusal," a seven-day period in which it may match the offer and retain him, or choose not to match the offer, in which case it may receive one or more draft picks for the upcoming draft from the player's new club. If an offer sheet is not executed, the player's rights revert to his old club the day after negotiations must end.
Tender amounts
In 2007, a second-round tender offer was added. The four tender amounts for 2008 are as follows:| Tender amount | Compensation required |
|---|---|
| $2.562 million | First- and third-round |
| $2.017 million | First-round |
| $1.417 million | Second-round |
| $927,000 | Determined by RFA's original draft status (see below) |
Each player that signs a tender receives the one-year salary that corresponds to the tender level. Teams which choose not to match an offer on a player with a low tender receive a draft pick corresponding to the round in which the player was originally drafted (except that the highest pick that can be surrendered for such a tender is a second-round pick). For example, a player who was originally drafted in the sixth round of the NFL Draft
NFL Draft
The National Football League Draft is an annual event in which the National Football League teams select eligible college football players and it is their most common source of player recruitment. The basic design of the draft is each team is given a position in the drafting order in reverse order...
would force the team signing him to give his former team a sixth-round pick in the upcoming draft as compensation for his service. No compensation is required for an undrafted player on the lowest tender amount, so teams with valued undrafted RFAs are taking a notable risk by offering such tenders.
Examples of possible outcomes
In addition to the following outcomes, if a player does not receive an offer sheet from his original team, he becomes an unrestricted free agent. If a player signs the offer sheet from his original team, he remains with that team.- Team declining to match offer sheet. Carolina PanthersCarolina PanthersThe Carolina Panthers are a professional American football team based in Charlotte, North Carolina. They are currently members of the South Division of the National Football Conference in the National Football League . The Panthers, along with the Jacksonville Jaguars, joined the NFL as expansion...
cornerbackCornerbackA cornerback is a member of the defensive backfield or secondary in American and Canadian football. Cornerbacks cover receivers, to defend against pass offenses and make tackles. Other members of the defensive backfield include the safeties and occasionally linebackers. The cornerback position...
Ricky Manning, Jr.Ricky Manning, Jr.Richard "Ricky" Manning, Jr. is an American football cornerback for the Florida Tuskers of the United Football League. He was drafted by the Carolina Panthers in the third round of the 2003 NFL Draft. He played college football at UCLA.Manning has also been a member of the Chicago Bears, St...
was a restricted free agent in the 2006 offseason. Based on the tender placed on Manning by the Panthers, the team would receive a third-round pick in the NFL DraftNFL DraftThe National Football League Draft is an annual event in which the National Football League teams select eligible college football players and it is their most common source of player recruitment. The basic design of the draft is each team is given a position in the drafting order in reverse order...
if Manning signed with another team. On April 21, the Chicago BearsChicago BearsThe Chicago Bears are a professional American football team based in Chicago, Illinois. They are members of the North Division of the National Football Conference in the National Football League...
signed Manning to an offer sheet - a five-year contract worth up to $23 million. Although the Panthers had a full week to decide if they wanted to match the offer sheet, they announced on April 24 that they would not match. At this time, Manning became a member of the Bears and the Panthers received a third-round draft choice in the 2006 draft2006 NFL DraftThe 2006 National Football League Draft, the 71st in league history, took place in New York City at Radio City Music Hall on April 29 and April 30, 2006. For the 27th consecutive year, the draft was telecast on ESPN and ESPN2, with additional coverage offered by ESPNU and, for the first time, by...
from Chicago.
- Team matching offer sheet. Arizona CardinalsArizona CardinalsThe Arizona Cardinals are a professional American football team based in Glendale, Arizona, a suburb of Phoenix. They are currently members of the Western Division of the National Football Conference in the National Football League...
offensive guard Reggie WellsReggie WellsReginald Arness "Reggie" Wells is an American football guard for the Carolina Panthers of the National Football League. He was drafted by the Arizona Cardinals in the sixth round of the 2003 NFL Draft...
was a restricted free agent in the 2006 offseason. On March 17, the Buffalo BillsBuffalo BillsThe Buffalo Bills are a professional football team based in Buffalo, New York. They are currently members of the East Division of the American Football Conference in the National Football League...
signed him to an offer sheet - a five-year deal worth approximately $18 million. Four days later on March 21, the Cardinals matched the Bills' offer sheet for Wells, and he reverted to the Cardinals.
- Team consummating a trade. The Miami DolphinsMiami DolphinsThe Miami Dolphins are a Professional football team based in the Miami metropolitan area in Florida. The team is part of the Eastern Division of the American Football Conference in the National Football League...
offered wide receiverWide receiverA wide receiver is an offensive position in American and Canadian football, and is the key player in most of the passing plays. Only players in the backfield or the ends on the line are eligible to catch a forward pass. The two players who begin play at the ends of the offensive line are eligible...
Wes WelkerWes Welker-San Diego Chargers :Welker, who was not drafted during the 2004 NFL Draft, signed as an undrafted free agent with the San Diego Chargers. Welker made the Chargers out of training camp, but was released after the first game of the season.-2004 season:...
a second-round tender in 2007. Although it was widely rumored that the New England PatriotsNew England PatriotsThe New England Patriots, commonly called the "Pats", are a professional football team based in the Greater Boston area, playing their home games in the town of Foxborough, Massachusetts at Gillette Stadium. The team is part of the East Division of the American Football Conference in the National...
would offer Welker a seven-year, $35 million deal, the Patriots ultimately traded their second- and seventh-round draft picks to the Dolphins for Welker, signing Welker to a five-year, $18 million contract.
NHL
A player who is no longer considered to be entry-level, but does not qualify as an unrestricted free agent, becomes a restricted free agent when their contract expires. A player may only declare themselves to be an unrestricted free agent if they are over the age of 27 or have played in the league for a minimum of 7 years.Qualifying offers
The current team must extend a "qualifying offer" to a restricted free agent to retain negotiating rights to that player.Players who earned less than $660,000 in the previous season must be offered 110 percent of last season's salary. Players making up to $1 million must be offered 105 percent. Players making over $1 million must be offered 100 percent.
- If the qualifying offer is not made, the player becomes an unrestricted free agent.
- If the player rejects a qualifying offer, he remains a restricted free agent.
- If the player does not sign before December 1st, he is ineligible to play in the NHL for the remainder of the season.
Possible outcomes
If a player accepts a qualifying offer he remains with his current team for a one- or two-year term. The length of the contract is determined by the player. At the end of this contract the player becomes an Unrestricted Free Agent. While the player is in negotiation with his current team, other teams are allowed to extend Offer Sheets to him. Should the player sign a proposed Offer Sheet, his current team is notified as such, can no longer negotiate a new contract or trade the rights to negotiate and is left with 2 options, Accept or Decline. The current team has 7 days to make its decision.- Accept The player remains with his current team on a contract identical to that of the Offer Sheet. The team is not allowed to trade the player for one year.
- Decline The player becomes a member of the team with whom he signed the Offer Sheet under all the terms of said Offer Sheet. His now former team claims draft picks from the player’s new team as compensation. Compensatory draft picks are determined by the player’s new salary on a sliding scale.
For example:
- In 2008 a team signing a restricted free agent to a salary averaging $2,615,625 to $3,923,437 per season will lose a first-round draft pick and a third-round draft pick to the player’s former team.
- Signing a restricted free agent to a contract worth over $6,539,062 per year costs a team four first-round draft picks.
At any point during the negotiation process, if the player has been in the NHL for longer than 4 years (less if the player signed his first contract after the age of 20), either the player or his current team may file for Salary Arbitration as a means of settling a contract dispute. At this point the player may no longer sign an Offer Sheet. The deadline to file for Salary Abitration is July 5th with cases being heard between late July and early August.
- Salary Arbitration. Both the player and his current team submit their expectations for the player's salary for the coming year. The team cannot request a reduction in salary of greater than 15%. The arbitrator hears the case from both player and team and renders a verdict. The verdict sets the salary the team is required to pay the player. After the arbitrator's verdict is rendered, the team must make a decision within 48 hours of the verdict being rendered. If the team accepts, the player is signed to a new contract at the salary set in the verdict. Should the team decline, the player then becomes an unrestricted free agent.
A team can take a player to arbitration once in his career. Players may request salary arbitration as often as they please.
NBA
Restricted free agency gives the player's original team the right to keep the player by matching an offer sheet the player signs with another team. This is called the "right of first refusal."Restricted free agency exists only on a limited basis. It is allowed following the fourth year of rookie "scale" contracts for first round draft
NBA Draft
The NBA Draft is an annual event in which the thirty teams from the National Basketball Association can draft players who are eligible and wish to join the league. These players are usually amateur U.S. college basketball players, but international players are also eligible to be drafted...
picks. It is also allowed for all veteran free agents who have been in the league three or fewer seasons. However, a first round draft pick becomes an unrestricted free agent following his second or third season if his team does not exercise its option to extend the player's rookie scale contract for the next season. All other free agency is limited to unrestricted free agency.
Qualifying offers
In order to make their free agent a restricted free agent, a team must submit a qualifying offer to the player by June 30. This prevents the team from not offering a contract and waiting to swoop in when the player tries to sign elsewhere. The qualifying offer ensures that the team does not gain the right of first refusal without also offering a contract themselves. Accepting a qualifying offer makes the player play for one season with the team that made the qualifying offer, in which case the player becomes a free agent again at the end of that season.The amount of the qualifying offers are, for players on rookie "scale" contracts, based on the player's draft position. For all other players, it is the greater of the following:
- 125% of the player's previous salary
- The player's minimum salary plus $175,000
The qualifying offer must be for one season. A player can elect to accept his qualifying offer (the qualifying offer must be accepted by March 1) and play the following season under its terms. This is sometimes done in order to become an unrestricted free agent the following summer.
If the deadline passes and the qualifying offer is neither withdrawn nor accepted, then the player continues to be a restricted free agent. The team and player are also still free to negotiate a new contract after the qualifying offer ends - the deadline only affects the player's ability to accept the qualifying offer.
Maximum qualifying offer
If the player is coming off the fourth year of his rookie scale contract, then in addition to a qualifying offer, his team can also submit a maximum qualifying offer. A maximum qualifying offer is for six seasons at the maximum salary with 10.5% annual raises. It can contain no options, ETOs or bonuses of any kind, and must be fully guaranteed. When a team submits a maximum qualifying offer (in essence "stepping up" with a maximum contract offer before the player even hits the market), it places a more stringent requirement on other teams' offer sheets (see below).Offer sheets
When another team wants to sign a restricted free agent, it signs the player to an offer sheet, the principal terms of which the original team is given seven days to match. The offer sheet must be for at least two seasons (not including option years). If the player's prior team also submitted a maximum qualifying offer, then the offer sheet must be for at least three seasons (not including option years). If the player's original team exercises its right of first refusal by matching the principal terms of the offer sheet, the player is then under contract to his original team. If the player's original team does not exercise its right of first refusal within seven days, the offer sheet becomes an official contract with the new team.KHL
Kontinental Hockey LeagueKontinental Hockey League
The Kontinental Hockey League is an international professional ice hockey league in Eurasia founded in 2008. As of 2009, it is ranked as the strongest hockey league in Europe....
players under 28 years of age as of July 1 of a given calendar year whose contracts are expired are considered restricted free agents. Just like the NHL and the NBA, the original team of a player who signed an offer sheet tendered by another team has seven days to match the offer sheet. However, unlike its North American counterpart, teams that decide not to match offer sheets collect transfer fees instead.