Palmer is scheduled to make $13 million in base salary this season. If he won't make the deal more salary-cap friendly, the team will be forced to decide whether it wants to keep the 33-year-old Palmer at his current salary or release him.
He passed for 4,018 yards with 22 touchdowns and 14 interceptions last season for the Raiders, who acquired the quarterback from the Cincinnati Bengals during the 2011 season for a 2012 first-round draft pick and a second-round selection in the 2013 draft.
Raiders general manager Reggie McKenzie has said that backup quarterback Terrelle Pryor will get a chance to compete for the starting position. Pryor earlier this month told the NBC Sports Network that he will be "more than ready" to vie for the job.