On its face, Jim Irsay’s decision not to seek repayment of $24.8 million from Andrew Luck appears to be a kind and generous gesture by a team owner toward a player who has given body and soul to the franchise.
I agree with that sentiment, but I also think it was a savvy business decision by Irsay, one that can pay both short- and long-term dividends.
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I believe Irsay wants Luck to go into retirement with good feelings for the Colts owner and for the franchise as a whole. Irsay is genuinely appreciative of how Luck immediately bridged the gap from Peyton Manning and lifted Indianapolis to the playoffs in his first three seasons.
But Irsay has been around the game for 40-plus years. He has seen it all.
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In not seeking repayment from Luck, in the short term, Irsay gains the belief of his current players and potential free agents that he is a team owner who cares about his players.
Irsay could have played hard ball and demanded repayment of Luck’s signing and roster bonuses that are tied to playing. He is well aware the Lions went after star receiver Calvin Johnson for the comparatively minuscule sum of $1 million of his prorated signing bonus when he retired, and Johnson developed bad feelings about the team thereafter.
This is $24.8 million we’re talking about, and on top of that, Luck's retirement will cost the Colts $18.4 million in dead money this year and $6.4 million next year.
Irsay surely has some bitterness about Luck surprisingly bailing two weeks before a tough regular-season opener in Los Angeles against the Chargers, even if the QB likely would have spent a good chunk of the season rehabbing while taking up a spot on the active roster or on injured reserve. But Irsay is smart not to let it show. So are general manager Chris Ballard and coach Frank Reich, who have said all the right things about a tough situation.
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The long-term investment for Irsay with this move is that Luck can feel grateful for the support. His calf and ankle will heal, and he might find himself missing the game and the rush of a playoff victory. Or the chase for a Super Bowl title and a spot in Canton might bring him back. Perhaps he will want his kids to someday see their dad play a sport in which he has been a top-five talent and four-time Pro Bowler at the most important position.
Yes, Luck would miss out on the hundreds of millions more he would have earned had he played the final two years of his contract and then signed an extension around $40 million per year. He could’ve battled through the rehab, helped backup Jacoby Brissett drive the train and returned in the second half of the season to lead another playoff run.
But Luck obviously was in need of a break from the game that has taken a physical and mental toll on him. As he said, the past four years of ”this cycle of injury, pain, rehab; injury, pain, rehab” has worn him down to the point that he felt “the only way out is to no longer play football.”
Time can be a healer. No one — even Luck himself — knows how his story will play out. The 29-year-old could truly be done with the game he loves, and he is already set financially after earning $103 million in his seven NFL seasons.
But the Stanford grad is not your typical quarterback, and he doesn’t appear to be consumed by the need to maximize his potential earnings.
I was Vikings GM when we drafted Robert Smith, and I knew the running back well. I saw him fight through two ACL tears to emerge as a Pro Bowl running back, and I signed him to a contract that made him the league’s highest-paid back in 1998 only to see him retire at 28 with two years left on his deal after leading the NFC in rushing. By then I had moved on to the Titans, but the Vikings wisely did not seek repayment of the $2 million in remaining prorated signing bonus.
I wasn’t surprised by Smith’s decision to call it quits, and I did not expect him to come back, because I believed him when he said he wanted to be healthy for the long haul. Sure enough, Smith stayed retired.
I don’t know Luck like I knew Smith, so I can’t predict if he’ll have a change of heart, and it wouldn’t surprise me either way. If he does return, though, it will be partially because Irsay made a wise decision in his financial treatment of Luck.
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Irsay planted a seed that could grow into a desire by his franchise QB to return when completely healthy and repay his owner’s generosity with a championship run. Or Luck might retreat to the solitude of his love of books, or to a broadcast booth, never to be seen again as the star QB with the blue horseshoe on his helmet.
Either way, Irsay has won the admiration of one of his franchise’s greatest players ever — and of Luck’s teammates — with his expensive-but-savvy move.
Jeff Diamond is a former president of the Titans and former vice president/general manager of the Vikings. He was selected NFL Executive of the Year in 1998. Diamond is currently a business and sports consultant who also does broadcast and online media work. He makes speaking appearances to corporate/civic groups and college classes on negotiation and sports business/sports management. He is the former chairman and CEO of The Ingram Group. Follow Jeff on Twitter: @jeffdiamondNFL.
