The cap impact of keeping the COVID Amendment for the Seahawks in 2021

The Seattle Seahawks have started the on field portion of their offseason program, with several veteran players arriving for OTAs as summer starts to get into full swing. With that being the case, it’s time to absorb and enjoy as much offseason news as possible, because with the start of the true dead season for the NFL news cycle just around the corner, football fans will not have a lot to read about regularly until training camp starts.

As always, the spring was filled with activity, from free agency to the draft, and just a week ago reports emerged that the NFL is likely to keep the COVID Amendment to the CBA in place for the 2021 season. There are, of course, a huge number of changes that were put in place as a result of the COVID Amendment, however, the relevance to today’s discussion can be distilled down to a handful of items which carry an actual impact on the salary cap of teams. Those specific points are:

• Practice squads expanded from 16 spots to 12 spots,
• Up to six players with any level of experience for members of the practice squad,
• Short-term injured reserve of 3 weeks,
• Unlimited number of players allowed to return from injured reserve during the season.

The first point is pretty simple to understand. During the 2021 season practice squad players will be paid one of two salaries depending on how many accrued seasons they have. Players with zero, one or two accrued seasons will earn $9,200 per week, while those on the squad with three or more accrued seasons will earn $14,000 per week. Combining those salaries together with the new 17-game, 18-week season, and practice squads will count somewhere between $2,649,600 and $3,168,000 depending on the experience of the players on the squad.

Those numbers represent a slight increase over the $1,987,200 to $2,160,000 range of practice squad salary expense that would have been in place had the size remained at 12 players with a maximum of two members with three or more accrued seasons. The difference is not huge if a team keeps mostly younger, inexperienced players on the practice squad, however, if teams once again load up their practice squads with experienced players like Alex Collins, Mychal Kendricks, Damon Harrison and other, they will need a slightly largely cap allocation to cover those salaries.

In addition, another important cost for which teams may need to keep a little extra cap space in reserve is to allow for the gameday practice squad elevations. These elevations are now written in to the CBA and are not a part of the COVID Amendment, but they could impact the amount of cap space teams need as a result of the lifting of the restrictions on the composition of practice squads in terms of player experience.

Specifically, the 2020 CBA allows teams to carry only two players on the practice squad with 3 or more accrued seasons, though the COVID Amendment allows for each team to have up to six players with three or more accrued seasons on practice squads. So, if the Seahawks have a practice squad that is heavy on experienced veterans, such as they did in 2020, when those players are elevated to the gameday roster, they earn significantly more than their practice squad salary for the week.

For example, say the Seahawks sign Bruce Irvin to their practice squad as he works his way back from the knee injury that ended his 2020 season. Irvin, as a player with three or more accrued seasons would typically earn $14,000 per week as a member of the practice squad. However, when a team takes advantage of the automatic elevation feature in the CBA, that elevated player earns league minimum for their experience level for that week. In Irvin’s case, the minimum salary in 2021 for a player with nine accrued seasons is $1,075,000, meaning that if elevated from the practice squad Irvin would earn $59,722 for that week. That is, of course, about $45,000 more than the standard practice squad salary, meaning all teams across the league will need too keep a little extra cap space compared to 2019 and prior in order to cover these costs.

Next, the ability to return an unlimited number of players from injured reserve also creates the need to retain additional cap space. The reason for this is that players on injured reserve continue to be paid, while at the same time the player who replaces them on the active roster also needs to be paid.

What this means is that even if a team places a player on injured reserve for the minimum of three weeks and then fills the open roster spot with a rookie earning minimum salary, the teams likely needs a little over $100,000 in cap space to cover the cost of the replacement player. This number comes from the fact that a rookie on a minimum salary contract will earn $660,000 in 2021, or $36,667 per game. With that additional player on the roster for a minimum of three weeks, it’s right at about $110,000 in cap space that must be used.

There are exceptions or situations where the amount of cap space may be slightly different. If the player placed on injured reserve is a veteran who has per game active roster bonuses in their contract, that could represent a cap savings for the team, however, that’s a whole different discussion that varies based on the classification of those bonuses in terms of likely to be earned or not likely to be earned and is a different can of worms for a different day. In addition, some younger players have split contracts which reduce their salary if they are moved to injured reserve, and that would offset some of the $110,000 in cap space needed. Again, however, that’s an entirely different lengthy discussion that basically boils down to the team still needing some, but not necessarily quite as much, cap space to cover injured reserve as a result of the 2020 COVID Amendment.

That is all, of course, assuming that the 2020 COVID Amendment is retained for the 2021 season. Reports currently have that as the expected outcome, but it is not necessarily written in stone just yet.

So, putting it all together, in the past teams typically needed somewhere in the neighborhood of $5M in cap space to cover injury replacements and the practice squad, while for 2021 those costs will be slightly higher. Ballpark estimates probably put the number somewhere in the $6M to $6.5M range. That gives the Seahawks a little bit of wiggle room based on the current NFLPA public salary cap report that puts the Hawks at $7,962,458 in 2021 cap space after accounting for Michael Dickson’s recent contract extension. Though it is important to keep in mind that that $7,962,458 only takes into account the top 51 salaries on the roster, while once the regular season arrives the team will need to expand that number to 53, as well as the players on the practice squad, injured reserve and the physically unable to perform list..