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NFL History: The Road to Free Agency
April 17, 2008
With the free agency period winding down as the draft approaches, teams have pretty much settled on which free agents will join their team for the next season.
We have become accustomed to the yearly meat-market that is NFL free agency. Did you ever wonder how we got to today’s version of free agency?
The road to free agency has mostly gone through the court system.
Originally, the NFL used the “reserve” system that was created in Major League Baseball. Under this system, once a player’s contract expired, he could renegotiate with the team that owned his contract. If the player did not work out a new deal but wanted to play, his team could renew his old contract with up to a 10% pay cut. Otherwise, the player was put on the “reserve list”, and no other teams were allowed to negotiate with him. The only way a player could move to another team was to retire, or hope his team sold or traded his contract.
In 1947, the league adopted the “1-year option” rule. This rule limited the team’s ability to automatically renew a player’s contract to just one year. Many owners used the reserve clause to indefinitely renew players’ contracts, and the 1-year option stopped that practice.
It took 16 years before R.C. Owens became the first player to change teams. He signed with the Baltimore Colts after playing out his option year with the 49ers. This move prompted the owners to create the “Rozelle Rule” in 1963.
Under the “Rozelle Rule”, whenever a team lost a free agent, the team signing that free agent had to compensate his former team. If the teams did not agree to terms, Commissioner Rozelle had the final authority to decide what the compensation would be.
Most teams found that it was better not to sign free agents under the Rozelle Rule. From 1963-1974, only 34 players signed with new teams. An example of Rozelle’s idea of compensation was when he required the Saints to give up two first round draft picks to the 49ers for signing wide receiver Dave Parks, who had caught only 26 passes during his last season in San Francisco.
In 1976, the player’s union won a court decision that found the Rozelle Rule to be an unfair restraint of trade.
After the ’76 court decision, the Collective Bargaining Agreement still forced teams to compensate the team losing a free agent, but the authority was taken away from Rozelle and written into the agreement.
In 1987, unhappy with the system negotiated into the CBA, the players went on strike. The owners effectively ended the strike by using replacement players to continue playing the season.
In 1989, the players’ union sued the league again. In this decision, the court ruled that because the players had a union to negotiate, they were not allowed to sue the league for anti-trust violations.
With fear of another lawsuit, the league adopted the “Plan B” system. Under Plan B, teams were allowed to protect 37 players on their roster, and the remaining players became unrestricted free agents.
The players voted to decertify their union in 1989, allowing individual players to sue the league. Freeman McNeil, a running back from the New York Jets, was the lead plaintiff in a suit in which a federal jury in Minnesota ruled that Plan B was illegal.
After the McNeil case, a flood of lawsuits hit the league, so the owners decided to bargain with the players again. In 1993, the owners granted the players free agency in exchange for a salary cap.
That is how we arrived to the system in place today. The players will continue to fight for their freedom, while the owners will keep working to maintain the competitive balance in the league. The owners have until November to exercise an option to end the current CBA in 2010. If that happens, the 2010 season will be without a salary cap. The decision will be interesting, because the owners are unhappy with how high the salary cap has gotten this season.
The battle will continue.