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Mr. Laz
02-13-2007, 10:41 AM
FRANCHISE TAG VERSUS TRANSITION TAG

As the free agency period approaches, a question from a reader has prompted us to conclude that it would be a good idea to post periodically items regarding some of the key concepts of free agency.

Today's lesson: the difference between the franchise tag and the transition tag.

Both designations are available to teams as a means for limiting the movement of players who otherwise would be unrestricted free agents. (A player becomes an unrestricted free agent if he has four or more years of accrued service, and if his contract has expired.)

The franchise tag gives the team the right to match any offers made to the player and, more importantly, two first-round draft picks as compensation if the team opts not to match. The transition tag gives the team only a right to match any offers, and no compensation.

To use the franchise tag, a team must extend a one-year offer equivalent to the average wages of the five highest-paid players in the league at the same position. Alternatively, the franchise player must receive an offer equivalent to 120 percent of his wages in the prior season, if that number is greater than the average wages of the five highest-paid players in the league at the same position.

For the transition tag, the tender offer is based on the average of the ten highest-paid players in the league at the same position or 120 percent of the player's wages in the prior season, whichever is greater.

Events of the past year have made the transition tag obsolete, as a practical matter. First, the rule previously was that the transition tender did not become fully guaranteed if it were accepted by the player. In contrast, the franchise tender converted to a guaranteed one-year salary as soon as the player signed it.

Now, both tenders are guaranteed fully once the player puts his John Henry Johnson on the dotted line.

Second, and more importantly, the poison-pill device used by the Vikings on the Seahawks (and then the Seahawks on the Vikings) provides an easy way to craft an offer sheet that can't be matched. For example, if the Bears were to put the transition tag on linebacker Lance Briggs, a team like the Vikings could put together a blockbuster deal with a provision that the entire package becomes fully and completely guaranteed if in any year that Briggs is not the highest-paid linebacker on the team (he most certainly would be No. 2 behind Brian Urlacher in Chicago) and/or if Briggs plays at least five games in any season in the State of Illinois.

With no right to compensation, then, it makes no sense to use the transition tag. At all.

One last point on the poison pill. The NFL and the union tried to hammer out a deal that would have gotten rid of the form-over-substance tactic, but an impasse was reached as to what the players would get in return. So if teams in a position to use the poison pill fail to do so, count on the union to make a swift claim of collusion.

Make no mistake about it: the league hates the poison pill. But it's now fair game when it comes to free agency, and since it promotes player movement the union loves it.

And this means that it would be a shock for anyone to use the transition tag, unless and until the poison pill is wiped off of the books.

Cave Johnson
02-13-2007, 12:00 PM
See John Tait.