Collective Bargaining Agreement

NBA Owners Unanimously Approve New CBA

December 21st, 2016 at 3:38pm CST by Luke Adams

The NBA’s new Collective Bargaining Agreement has taken one step closer to becoming official, according to Jon Krawczynski and Tim Reynolds of The Associated Press, who report that NBA team owners have voted to approve the tentative agreement. Per the AP duo, the vote among owners was unanimous.

With the owners officially on board, the players will need to cast their ballots before the deal can formally be ratified. Two people with knowledge of the situation tell Krawczynski and Reynolds that the players are expected to finish voting in the coming days, with one source suggesting it could happen by Friday.

The votes from the NBA and the NBPA are viewed as a formality, since both sides are in agreement on the term sheet that was put together earlier this month. Once the two sides officially vote to approve the deal, that term sheet will provide the framework for the official Collective Bargaining Agreement, which will still need to be written up. The deal is expected to be formally completed before the January 13 deadline, and will go into effect for the 2017/18 league year.

For details on the league’s new Collective Bargaining Agreement, including changes to rules surrounding trades, contract extensions, free agency, and more, be sure to check out our CBA news archive, where we’ve been rounding up new updates as they’re reported.

New CBA Grandfathers Harden, Westbrook For New Extensions

December 20th, 2016 at 9:29pm CST by ChrisCrouse

The new CBA will not allow for players to sign contract extensions in back-to-back offseasons, but the agreement will include a provision that will allow James Harden and Russell Westbrook to do exactly that, Adrian Wojnarowski of the Vertical reports. The new labor agreement will grandfather Harden and Westbrook into the pool of players eligible to be designated for the super-max contracts by their respective teams.

Both players signed contract extensions this past offseason, but the league and the union agreed that neither player – nor the Rockets or Thunder – should be penalized for operating within the current framework, as the teams and players were not aware that the new CBA would offer such a benefit for waiting just one more season.

Westbrook could sign a five-year, $219MM extension with the Thunder that would begin in the 2018/19 season, according to Wojnarowski. Harden could sign with the Rockets for an additional four years and $171MM on top of the $58.7MM he is set to receive over the next two seasons.

Wojnarowski hears that out of the two players, Westbrook is more likely to sign another extension this summer. Harden may prefer to wait until closer to the end of his current deal to gauge whether or not Houston is able to truly become a title contender.

Harden’s current deal includes a player option for the 2019/20, meaning he could become an unrestricted free agent during the 2019 offseason. At that time, Harden will be entering his 10th year in the league, which is another reason he needed to be grandfathered as an eligible player. The new Designated Player Veteran Exception rule covers players entering their eighth or ninth years of service, per Wojnarowski.

CBA Notes: Warriors, Trades, Designated Players

December 20th, 2016 at 2:28pm CST by Luke Adams

In many ways, the NBA’s new Collective Bargaining Agreement will help out the Warriors, most notably giving the team the opportunity to offer Stephen Curry way more money than any other team in 2017 free agency, due to the new designated player exception. However, a super-max salary for Curry, along with increased cap holds for free agents, will make it tricky for Golden State to keep its roster together beyond its Big Four after this season.

As Bobby Marks of The Vertical outlines, the Warriors will have the flexibility to keep Klay Thompson and Draymond Green while giving Curry and Kevin Durant super-max contracts, but it could very well cost the team complementary players like Shaun Livingston and Andre Iguodala. Marks observes that Golden State will need to place a “heavy emphasis” on player development if the team wants to keep its core four together, since players like Damian Jones, Patrick McCaw, Kevon Looney, and future draftees will be relied on for larger roles if the club can’t afford its other veterans.

We’ve got a few more CBA notes and updates to pass along, so let’s dive in…

Updating an item that he reported earlier this week, Eric Pincus of Basketball Insiders clarifies that for a player who signs a partially guaranteed contract under the new CBA, his outgoing salary will only count for the guaranteed amount in a trade, while the incoming salary will count for the full amount. If there’s a major discrepancy between the two amounts (ie. $1.5MM guaranteed on a $12.5MM salary), it will make it very tricky for a player to be included in a deal.
Because the designated player exception can only be used on a player who remains with the team that drafted him, or the team that acquired him in a trade during his rookie contract, one unintended consequence could be that star players on their rookie deals push for trades, writes Kevin Pelton of ESPN.com (Insider link). As Pelton admits, such a move would require plenty of foresight, since a player would have to request a trade by his fourth season with an eye toward year eight or nine of his career, but it’s a possibility.
With an assist from cap expert Larry Coon, Brian Windhorst tackles some of the most frequently asked questions about the new CBA in an informative piece for ESPN.com.
Coon also joined Pincus on the Basketball Insiders podcast to discuss their expectations for the new CBA.
Veteran union representatives like LeBron James and Chris Paul are among the biggest winners in the new CBA, due to the reworked “over-38” rule, Windhorst writes in a separate ESPN.com piece.

Latest On How New CBA Will Affect Trades, Extensions

December 19th, 2016 at 9:47am CST by Luke Adams

Details on the league’s new Collective Bargaining Agreement continue to trickle out, and Eric Pincus of Basketball Insiders passes along a particularly interesting nugget this morning. According to Pincus, the term sheet for the new CBA suggests that a player who signs a deal under the new agreement will only have the guaranteed portion of his contract used for salary-matching purposes in a trade.

As an example, Pincus points to Arron Afflalo, whose $12.5MM salary in 2017/18 is only guaranteed for $1.5MM. Afflalo won’t be directly affected by this change, since his contract was signed under the previous CBA, but going forward, it will impact players who sign similar deals. Based on the new CBA rules, that salary would count for just $1.5MM in a trade, rather than $12.5MM. The change should help deter teams from acquiring players on non-guaranteed salaries and then immediately waiving them to cut costs.

Pincus also shares several more details on the new CBA, so we’ve rounded up some of the highlights below. As usual, these details are part of the tentative agreement, but that agreement has yet to be formally ratified, so it’s subject to change. Be sure to check out Pincus’ full article for more info.

Contract extensions:

Under the previous CBA, a veteran became extension-eligible if at least three years had passed since he signed a contract of four years or more. The new CBA will allow players to sign veteran extensions two years after they signed their previous deal, and three-year contracts will be eligible to be extended.
Designated player extensions can only be signed during the offseason, beginning on July 1, similar to rookie scale extensions. The salary in the first year of a designated player extension will be between 30-35% of the cap, and there will be language in the deal to potentially grandfather in players who signed extensions this past offseason, such as Giannis Antetokounmpo.
The criteria for the designated player extension for players coming off rookie contracts will be the same as for the veteran designated player extension. Those criteria relate to All-NBA, MVP, or Defensive Player of the Year awards, with All-Star starts no longer included.
The deadline for rookie scale extensions will be moved up to one day before the regular season begins. Previously, the deadline was October 31.

Suspensions:

A player who is suspended without pay will now be docked 1/145th of his salary per day, rather than 1/110th. However, suspensions of 20+ games will still result in a player losing 1/110th of his salary per day.
A player who tests positive for a steroid or performance-enhancing drug will be suspended 25 games if he’s a first-time offender, and 55 games if he’s a second-time offender.

Salary cap:

The NBA will determine the salary cap for a given league year before the July moratorium gets underway, rather than calculating it during the moratorium.

Heat Notes: CBA Changes, James Johnson, Winslow

December 17th, 2016 at 8:40pm CST by Arthur Hill

Some new provisions in the CBA could work against the Heat in free agency next year, writes Barry Jackson of The Miami Herald. Because maximum salaries are increasing, it will be more difficult for a team to add more than one max player each year. Miami could have about $40MM available in cap space next summer if Dion Waiters and Willie Reed both opt out and Chris Bosh is cleared from the cap, which could have been enough for two max deals in prior years. Also, mid-level exceptions are increasing, which will help teams without cap space get better players, and minimum salaries are increasing 45%, which will increase cap holds for empty roster spots from about $1MM to $2MM each. The NBA mandates that teams fill 12 roster spots with players or cap holds.

There’s more tonight out of Miami:

Another important change is that teams can now give their own free agents six-year contracts instead of five, notes Ira Winderman of The Sun Sentinel. The difference between staying with a team for six years or going somewhere else for four could be $90MM to $100MM over the life of a contract, which reduces the advantages the Heat have enjoyed from their South Beach location and recent playoff success.
Miami’s James Johnson is among the players who might benefit from the increased mid-level exception, Winderman writes in a separate piece. The new MLE is expected to be in the $8MM range, which is about twice what Johnson makes right now. Because Johnson signed a one-year contract over the summer, Miami won’t have his Bird Rights, which means his entire salary will have to come from cap space. Johnson has become a valuable reserve for the Heat, averaging career highs of 10.3 points and 4.7 rebounds per game.
Finally back from a troublesome wrist injury, Justise Winslow is making an immediate impact, Winderman states in another story. Winslow’s sore left wrist forced him to miss 16 games and raised the concern of offseason surgery. “He’s doing plays that you cannot see in stats, and that’s huge for the team,” said teammate Goran Dragic. “He can defend multiple positions. He can organize us. And he can find people. So that’s a unique talent.”

CBA Details: Extensions, Rookie Salaries, Cap Holds

December 16th, 2016 at 4:03pm CST by Luke Adams

Although the NBA and the players’ union has reached an agreement on a new Collective Bargaining Agreement, that deal has yet to be ratified, so we don’t yet know all the official details. Nonetheless, Tim Bontemps of The Washington Post has several more updates on what we can expect from that new CBA when it formally goes into effect. Here’s the latest:

Designated Player Exception:

The new designated player exception, which allows certain players to sign for 35% of the salary cap even though they don’t have 10+ years of NBA experience, can be used on a player who reach free agency in addition to a player who is in the final year of his contract. For instance, next July, someone like DeMarcus Cousins – who would have one more year left on his deal – would be eligible for a designated player extension, and so would Stephen Curry, whose contract will expire in July.
To be eligible for the DPE, a player must have made an All-NBA team or have been named the MVP or Defensive Player of the Year in the previous season, or in two of the three prior seasons. He also has to be on the team that drafted him — or have been traded on his rookie contract to another team. So Curry, Cousins, Russell Westbrook, and some other players would be eligible for this extension, but Kevin Durant wouldn’t be.

Veteran Contract Extensions:

Regular veteran contract extensions not tied to the designated player exception will also be affected by the new CBA. Under the current deal, veteran extensions can be for up to three new years and can start with a 7.5% salary bump, assuming the team doesn’t have cap room. Under the new CBA, the limit on new years for an extension will increase to four, and the starting salary can increase by up to 20% on the player’s previous salary.

Free Agency:

Exceptions like the minimum salary, mid-level, and rookie scale will be increasing by 45% next year and will be tied to the salary cap after that. Additionally, players will be able to get slightly larger raises on free agent contracts. Instead of 7.5% annual raises for a Bird Rights player, and 4.5% for other players, it will be 8% and 5%, respectively.
In free agency, teams will still only have to account for 12 roster spots, even though the minimum roster size is increasing to 14 players. For instance, if a team goes into free agency with five players under contract, it will have to account for minimum-salary cap holds for seven empty spots. The rule should help teams looking to maximize their cap room in free agency.
The cap holds for restricted free agents were previously 200% or 250%, depending on whether or not their previous salary was above the league’s average salary. Under the new CBA, those figures will increase to 250% and 300%. The goal is to try to discourage teams from doing what the Wizards and Pistons did with Bradley Beal and Andre Drummond this past summer — those teams knew they’d be signing their own players to max deals, but waited until well until free agency to get those contracts done, in order to keep their modest cap holds on the books and use their cap room on other players.

Rookie Salaries:

With rookie scale contracts set to rise by 45% for new NBA players next year, there will also be some adjustments made to current rookie deals, so recent draftees don’t miss out on those increases due to unlucky timing. In 2017/18, a first-rounder from 2014, 2015, or 2016 who remains on his rookie contract will have his salary increased by 15%. In 2018/19, first-rounders from 2015 and 2016 will have their salaries increased by 30%. In 2019/20, the salaries for 2016 first-rounders still on rookie contracts will increase by 45%. These salary bumps won’t be reflected in salary cap figures.

Luxury Tax Apron:

The luxury tax apron, which is the space between the luxury tax line and the hard tax line that certain teams aren’t allowed to surpass, is at $4MM under the current CBA. In the new CBA, that figure will increase to $6MM for next season, and will continue to rise based on inflation after that.

Latest Collective Bargaining Agreement Details, Reactions

December 15th, 2016 at 4:00pm CST by Luke Adams

The NBA’s new Collective Bargaining Agreement will allow teams to use the new designated veteran exception on two players, rather than just one, meaning teams would have the option to extend two star players to long-term max contracts before they reach free agency, says Howard Beck of Bleacher Report (via Twitter).

ESPN’s Brian Windhorst discusses the topic as well, suggesting that the new second designation will be known as the “Kevin Love Rule,” since the Timberwolves previously were unable to offer Love a five-year max because they had also made Ricky Rubio their designated player. This time around, the Wolves will be able to designate both Karl-Anthony Towns and Andrew Wiggins, if they so choose.

We’ll need to wait for the CBA to be formally ratified to know for sure whether different rules for this designation will be in place for guys like Towns and Wiggins, who are coming off rookie deals, as opposed to veteran players who are on their second or third contracts. While we wait for the full details, we have a few more tidbits related to the new CBA to pass along…

Details:

According to TNT’s David Aldridge (via NBA.com), the NBPA pushed for a “zero and two” rule for prospects. Such a rule would have allowed players to enter the NBA draft out of high school, but if they chose to attend college, they would have had to play at least two NCAA seasons before declaring for the draft. Ultimately though, the current “one and done” rule will remain unchanged in the new agreement.
NBPA president Chris Paul, who was thrilled to reach an agreement, said he’s most excited about what the new deal will do for the health care and health insurance of former NBA players, per Rowan Kavner of Clippers.com. The health care packages for retired players will be co-funded by the NBA and the players’ union, per Aldridge.
There will be no major changes made to the international buyout rules in the new CBA, sources tell Jonathan Givony of DraftExpress.com (Twitter link). The current maximum that NBA teams can pay ($650K) is expected to rise by $25K annually.

Reactions:

Tom Ziller of SBNation.com has multiple pieces breaking down the new CBA, pointing to the modification of the over-36 rule as one way the new agreement helps Paul, and examining the winners and losers of the deal.
Like Paul, many players around the NBA greeted the news of a new CBA with excitement and positivity. Baxter Holmes of ESPN.com has the quotes and the details.
One player who didn’t share that excitement was Draymond Green, who originally made some cryptic comments on Twitter expressing his disappointment (link via Alysha Tsuji of USA Today). Green expanded on his position today, explaining that he would have liked the deal to provide more money and support for younger players and minimum-salary players, to balance things out (Twitter links).
The new CBA looks like it will put more pressure on teams to make the right decisions in the draft, says Sean Deveney of The Sporting News.

Details On New Collective Bargaining Agreement

December 14th, 2016 at 9:42pm CST by ChrisCrouse

The NBA and the NBPA have agreed in principle to a new seven-year Collective Bargaining Agreement, according to a league press release. The league also announced that both parties have agreed to extend the mutual deadline to opt out of the current CBA from December 15, 2016 to January 13, 2017 in order to give both sides enough time to review the terms of the agreement and vote on them. Details of the agreement are trickling out. Here’s the latest:

9:42pm:

Luxury tax penalties will be “softened” for some teams and trade rules will be “liberalized,” according to Sports Illustrated. Free agency terms will become more favorable for players in general with fewer restrictions on first-round picks and a shorter moratorium.
A “comprehensive” program to deal with domestic violence, sexual assault and child abuse will be established. The program will offer resources for players and their families. It will also contain a defined process for investigations.

9:10pm:

In regards to the designated player rule for veteran extensions, only players who meet certain performance criteria, such as All-NBA team appearances, will be eligible for an extension, Zach Lowe of ESPN.com reports (Twitter links). Lowe adds that the first year of a players extension can be worth up to 35% of the salary cap regardless of whether the team has the cap room or not.
Teams will not be able to give a six-year extension to a player it just traded for, Tim Bontemps of The Washington Post relays (Twitter link).
The window for teams to match offers during restricted free agency will be reduced from three days to two days, Stein tweets.

8:00pm:

The 36-and-over rule, which removes the incentive for teams to sign players to long-term deals if their 36th birthday falls during the life of the deal, has been altered to a 38-and-under rule, sources tell Wojnarowski.

7:33pm:

The deal is for seven years, but contains an opt-out after the sixth season, David Aldridge of NBA.com tweets.
Minimum salaries will rise by about 45% beginning in the 2017/18 season, Scott Soshnick Of Bloomberg reports. The average player salary will also grow to $8.5MM, which is up from $5MM, and retired players are expected to get better benefits than in previous deals.
The split in BRI is expected to be roughly the same as it was in the previous CBA with the players receiving 51%, Soshnick adds.
Teams will be allowed to expand rosters by at least one and at most two players if additional players are sent to the D-League, Soshnick reports. These additional roster spots would be for the highly anticipated two-way contracts between the NBA and the D-League.
The players union will take control of group marketing rights, Soshnick adds.
The players union and the league will form a committee to decide how the NBA will use wearable technology and the data it produces, Soshnick relays.
Teams will now be able to choose a designated veteran for a lengthy new contract, similar to how teams can use the designation player rookie extensions, Marc Stein of ESPN.com tweets. Extensions could include up to six seasons once the player is entering the final year of his current deal.
The league will shorten the preseason to a maximum of six games and start the regular season a week sooner in an effort to spread out games, Adrian Wojnarowski of The Vertical reports (Twitter link).
The league will keep the one-and-done draft rule for now, but the players union and the league will continue to research the issue and possibly change the rule during the life of the new CBA, Wojnarowski adds (Twitter link). Neither side is committed to keeping the rule, but the parties decided to table the issue for now.

NBA, Players Union Reach Agreement On New CBA

December 14th, 2016 at 6:37pm CST by ChrisCrouse

6:37pm: The NBA and the NBPA have reached a tentative deal on a new CBA, pending ratification by players and team owners, the league announces via press release. Both parties have agreed to extend the mutual deadline to opt out of the current CBA from December 15, 2016 to January 13, 2017 in order to give both sides enough time to review the terms of the agreement and vote on them.

6:30pm: The two sides have reached an agreement in principle on a new seven-year CBA, Adrian Wojnarowski of The Vertical confirms (Twitter links). The two sides will jointly make an official announcement tonight.

6:20pm: The deal is complete and is pending ratification, Marc J. Spears of The Undefeated reports (ESPN Now links). The players are expected to vote on the deal next week.

6:04pm: An agreement in principle between the NBA and the NBA Players Association on a new labor deal could be reached as early as tonight, Marc Stein and Ian Begley of ESPN.com report. Stein adds (via Twitter) that both sides essentially view the deal as “done.”

The deadline for both sides to opt out of the current labor deal is Thursday at 11:59 p.m. ET and the negotiations conducted between the two sides this week have put them on course to reach an agreement before the deadline. One source told the ESPN scribes that the deal is expected “very soon,” which would squash any possibility of a lockout in the 2017 season.

It was previously reported that group licensing remained a barrier to a deal, but Stein and Begley hear that those issues have been resolved.

Both sides are expected to jointly announce a deal once it is finalized. A deal won’t become official until both league owners and active players vote to ratify it, but those votes are merely a formality.

Progress, Optimism Surround CBA Negotiations

December 13th, 2016 at 10:38pm CST by Arthur Hill

10:38pm: The NBA and the NBPA are meeting tonight at the league’s office and David Aldridge of NBA.com (Twitter link) reports that the group licencing issue will not hinder their ability to consummate a deal.

10:21am: With the deadline approaching, only one issue stands in the way of a new collective bargaining agreement, tweets Bloomberg’s Scott Soshnick. As talks wrapped up Monday night, a source told Soshnick that the owners and players were “98% there.”

The unresolved issue involves group licensing, according to Adrian Wojnarowski of The Vertical (Twitter link). “Still working at it, still close,” a source tells Wojnarowski (Twitter link). Both sides agree on the major points of the issue but are just “hashing out the language,” tweets Jon Krawczynski of The Associated Press.

Other major issues, such as retaining the current split of basketball-related income, have already been settled.

It’s the latest positive sign that a new CBA will be reached before 11:59 pm Thursday, which is the last moment that either side can opt out of the current deal. If someone does opt out, negotiators would have until June 30th to reach a new agreement before risking a lockout. The two sides also have the option of extending the deadline if a deal cannot be finalized in time.

TNT analyst David Aldridge also reported optimism Monday, hearing that more progress had been made (Twitter link). It’s a change in direction from Saturday, when Carmelo Anthony, a players association vice president, said he was skeptical that an agreement could be reached before the deadline.

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