Payton's contract situation raises questions

Sunday’s startling news that Sean Payton’s contract with the New Orleans Saints has been voided raises more questions than it answers.

A purported extension between the coach and team, negotiated in September 2011, was nullified by the NFL, reportedly due to an impermissible escape clause allowing Payton to become a free agent in the event general manager Mickey Loomis were to exit, whether voluntarily or involuntarily (through suspension or firing).

No revision?

Like player contracts, coaching contracts require final approval by the commissioner’s office. I negotiated dozens of coach contracts, and although I never had one disapproved, there were times I was required to change or revise language in a player contract prior to approval. That call from the league would lead to further negotiation with the player and agent to resolve the matter to the league’s satisfaction.

This raises the question as to why the Saints and Payton did not, and apparently still have not, quickly and quietly resolved the matter to allow for contract approval.

With the disapproval having taken place more than a year ago, my sense is that either the relationship between Payton and the team may not be as close as it was or the presence of the now-suspended Loomis was so important to Payton that he would not agree to revise the clause. Or there is the possibility Payton would prefer free agency to remaining with the Saints.

Tying to Loomis

Why would Payton have a clause tying his continued allegiance to the team to Loomis? Certainly the two are close, but this type of language is uncommon. With the bounty inquiries going on over a three-year period, one wonders what Payton or his agent knew about potential issues concerning Loomis’ continued presence with the team.

I learned firsthand that the NFL would not approve a player contract tied to another player. When negotiating Aaron Rodgers’ rookie contract in Green Bay, we tried to project incentives and escalators in the future dependent on Brett Favre still playing for the Packers. I inquired about linking Rodgers’ escalator thresholds to whether Favre had retired. I was emphatically told that I could not.

It is not known the reason the Loomis clause was disapproved, but it may revolve around the same theory of tying one employee’s rights to another’s.

Toll the bell?

There is also the question of whether the contract “tolls” for this season, meaning that although Payton is suspended, the contract is suspended as well, leaving a year left on the original deal. Any player suspended in the final year of his contract does not become a free agent after suspension; he would still have a year left. It is unclear why Payton’s contract would not be similarly treated.

These are just a few questions raised by the Payton news. It is even more curious that we are discussing this in November 2012, when the NFL rejected the extension in September 2011.

Clearly, there is more to the story, which will play out when Payton comes off suspension after the Super Bowl. Stay tuned.