James Harrison Contract: Pay Cut Versus Restructure

I was asked via email what a restructure would look like for Pittsburgh Steelers linebacker James Harrison if another year was added onto his contract this week.

Harrison\’s agent, Bill Parise, said initially that his client wasn\’t open to taking a pay cut, but that they were open to doing a restructure. The two sides were reportedly talking again on Tuesday, but word has yet to surface as to which way the talks are heading as far as a possible pay cut or restructure goes.

Harrison is set to earn a base salary in 2013 of $6.57 million. His cap number, mind you, is scheduled to be $10.035 million. Should the Steelers turn all but $1 million of his 2013 base salary into a signing bonus, and add another year onto his contract, that would lower his cap hit in 2013 down to $6,321,666.67, which would create a cap savings of $3,713,333.33.

The downside of doing a restructure like that would be that it would add another $3,713,333.33 in potential dead money to 2014. When added to the other $1,465,000 million in bonus proration that already exist in 2014, Harrison could potentially cost the Steelers $5,178,333.33 in dead money against the cap in 2014.

So what if the Steelers were to make Harrison a post June 1st cap hit next offseason using the scenario above? Assuming his 2014 base salary of $7.575 million remained the same in the restructure, the Steelers would have to carry his full new cap hit of $10,896,666.67 cap hit until June 2nd next offseason before being able to recognize the extra little cap savings of a post June 1st cut.

So what if the Steelers didn\’t add on another year in a restructure this offseason? Turning that same $5.57 million used in the first example into a signing bonus, without an extra year added, saves the Steelers $2.785 million in cap space in 2013, but the potential dead money charge in 2014 would be $4.25 million.

Unless I am missing an alternative here, neither of the two plans laid out above are acceptable as far as 2014 goes, especially being that in 2014 the salary cap is expected to remain somewhat flat.

The Steelers chose not to restructure Harrison last year. It\’s hard to imagine that they would want to do so this year as well. The only solution here, in my opinion, is for Harrison to take a straight salary cut in 2013 of $3 million or more, as I have already talked about several times before. If he doesn\’t, he would have his contract terminated, which would clear $5,105,000 in cap space in 2013 even with the $4.93 million dead money charge.

The two sides are talking right now and obviously that means that Harrison has to have his 2013 cap number lowered. We now have less than a week to go before we will know the outcome.

I am, I'm me. 40 something, retired and a life long Steelers fan.
  • walter mason

    Thanks for explaining Dave. I agree restructuring/extension is not an option.

  • steeltown

    Man.. thats kind of confusing, but what I take from this is the same as its been… Paycut or Termination

  • Guest

    … and Omar Khan and K.Colbert are probably taking copious notes on this; may be even print screen and hit print… :] :0

  • Mikey Hoje

    … and Omar Khan and K.Colbert are probably taking copious notes on this; may be even print screen and hit print… :] :)

  • http://pulse.yahoo.com/_ESU2VFZHEUTQEPJ7AWSN7ODBPQ Emac2

    Can they add a year and cut the base but add incentives so that he basically gets paid for the games he plays over the next 2 years but doesn’t get paid anything for games he fails to make 2 tackles. (or something like that)

    1 mil signing bonus and 1 mil per game for the next 2 years?

    How many games is likely to be earned with a player like Harrison anyway?

  • Shannon Stephenson

    Harrison is still playing at a high level. He is our best player on the team creating pressure. Does he have 2 years? Not sure but what do we know? Worlids has yet to show he can play on that side….Carter hasn’t shown us the ability to get pressure…Robinson still is growing and the draft will most likely not produce a starter this year. This is the toughest position this year IMO and i do not think it is a termination or pay cut necessarily. The Steelers have a better feel for this than us but I can say this…If we had an answer at that position we probably wouldn’t be in talks with his agent!

  • HarryBackside

    Harrison has played well, but he’s been declining since 2010. When the end comes, it’s going to come quick.

  • Shannon Stephenson

    I felt he was playing well in 2011 till the eye injury and he wasn’t the same in 2012 till he was able to get a few games under his belt after his injury. At the end of this year he began playing well in the last few games. Its a sticky situation.

  • mokhkw

    & The Steelers hold the upper hand here because Harrison knows that if he gets cut he’s unlikely to get more than a 2 year deal worth $2.5mil a year from any other teams. Taking a paycut to stay (lets say $3mil like suggested) still leaves him above that. Aside from age & injury concerns, he’s also been suspended once, which means he’s likely to get 2-4 games if he gets suspended again.

    I like the way he finished last season after he got healthy & think he can still play at a high level for 2 more years but the risk has to be in line with his salary – which is simply too high atm.

  • walter mason

    Harrisons agent has agreed only to restructuring and I dont think you can cut base pay to add incentives to an existing contract during simple restructuring but Im just guessing.

    Paycut or Termination. Maybe theoretically he could be re-signed to a completely new contract after termination but again Im just guessing.

  • Pete

    I agree. There really is nobody on the roster to replace him yet and they know he’s still capable of playing at a high level. If a restructure doesn’t reduce the cap hit enough then they must be talking about how much a cut he’ll take, Bettis and Hampton took deep cuts but Bettis had already been eclipsed by Parker and Hampton is near the end of the road. Not so with Harrison. Woe unto us if they can’t work something out and the Steelers decide to go with Worilds and Carter. I can already hear the wailing and the gnashing of teeth in Steelers Nation.

  • HarryBackside

    You asked earlier if he has two years. He might, but it’s just as likely that he doesn’t. The fact that people are having this discussion is why it would be a bad idea to guarantee his 2013 salary to push his cap hit out to future years. I want to see him play this year, but not enough to risk the possibility of taking a big dead money hit in 2014 if Harrison is released after the 2013 season.

  • HarryBackside

    No one thought that the Steelers had a player to replace Joey Porter when he was cut, but we all know how that worked out. I’m not saying that Worilds is James Harrison, but he’s been more productive over the last three years than Harrison was during the three years prior to replacing Porter.

  • HarryBackside

    Only agree to a restructuring… for now. I doubt Harrison wants to retire, or play for another team. If the Steelers can get him to agree to a $2M pay cut, Harrison will still earn $4.5M in salary this year. Will that be good enough? Who knows.

  • SteelSpine

    - Maybe Ike can influence getting a Harrison contract done:) Interesting interview at PG which William Gay said the minute Gay was cut, Ike called Gay to push Gay to return to Steelers then Ike quickly called Colbert & said Colbert you need to get Gay back. As to whether Ike could help Harrison I’m kidding, but its interesting that Ike gets involved.

    – I don’t care which other team Harrison goes to other than I hope it’s not to a team in our division. That’s because I foresee Harrison schooling Adams or getting right around whichever other of our options plays our left tackle Starks etc.

    – Latest mock Walter Football has Jarvis Jones going to Steelers, I read it PG & couldn’t believe it so I looked it up & yes, has Steelers 1st 4 rounds being: Jarvis Jones, Deandrae Hopkins, Monte ball, & TJ McDonald.

  • Nolrog

    Sometimes it’s just time to move on, even if the guy may have another year left in the tank. They should cut Harrison and use that money to resign Lewis.

  • Clint Martin

    But if he has 10 tackles he makes more?! mill a year is a slap in the face bro
    Another team would pay him he still is a game changer. How bout if refs would actually call holding every time he got held?

  • Shannon Stephenson

    My thoughts on that was if we had a guy waiting we wouldnt be negotiating…the Steelers knew Harrison was good enough and ready so we let J-Peezy go. I do not think the Steelers feel a Harrison is in the wings or they would just let him go.

  • steeltown

    Exactly… $5.2MIL in dead money if restructured and ultimately released after 2013… no thank you

  • urstudent

    Problem here is also the LB situation. Jason Worilds hasn’t had a full chance yet, though he’s played well in the few games he’s started. Keeping Harrison for another year would probably mean Worilds finishes his rookie contract and walks at the end of the season; which could backfire should he become a good LB for another team.

    Then when you consider how well Harrison played at the end of the season, it’s hard to justify cutting him just to test out a draft pick from a few years back. But because of the cap situation, it may be Omar Kahn and Kevin Colbert’s only option.

  • steeltown

    Exactly… 8-8 is 8-8… and cap problems are exactly that, problems

    We could start Worilds for cheap this year and we would not only see exactly how good he is.. and Im pretty sure Worilds production as a starter could atleast mirror that of Harrison or Woodley of late (2012), if not surpass it

    8-8 is unacceptable

    Didnt want to cut Farrior or Porter or Ward either, but….

  • soldierbood24

    If woodly would come around the steelers would not be in this deal. We signed him to a long deal to be our number one pass rusher and he is always lazy and hurt needs to turn it around. Cant get by anyone lucky sacks he gets needs to be the real player he was again.

  • Pete

    My sentiments exactly. The Steelers knew what they had in Harrison and could afford to let Porter walk. Harrison graded out as the NFL’s 10th best OLB in 2012 despite missing 3 games and playing less than 100% while recovering from knee surgery most of the season. Healthy he’s top 5. Harrison has only started for 7 seasons. He definitely has more juice in the tank.

  • Jollyrob68

    I like James but he needs to help out the team and take a paycut. If not then attempt to trade him for a late pick or cut him.