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NBA Bargaining and Negotiations
- 1. NBA Bargaining & Negotiations CHARLES BAILEY
- 2. Collective Bargaining in the NBA Dictates the rules of player contracts Trades Revenue Distribution The NBA Draft Salary Cap of Players Roster Size of team players
- 3. What is the N.B.A The NBA stands for the National Basketball Association The Association was started in June 6, 1946 in New York City Headquarters are located in New York City, NY The current Commissioner is Adam Silver
- 4. NBA Commissioner Adam is the 5th Commissioner appointed by the NBA Board of Governors in 2015
- 5. Who are the official N.B.A teams? The National Basketball Association which bargains with 30 team owners which include: Boston Celtics Brooklyn Nets Atlanta Hawks Charlotte Hornets Miami Heat Orlando Magic Washington Wizards New York Knicks Philadelphia 76ers Toronto Raptors Chicago Bulls Cleveland Cavaliers Detroit Pistons Indiana Pacers Milwaukee Bucks Dallas Mavericks Houston Rockets Memphis Grizzlies New Orleans Pelicans San Antonio Spurs Denver Nuggets Minnesota Timberwolves Oklahoma City Thunder Portland Trail Blazers Utah Jazz Golden State Warriors Los Angeles Clippers Los Angeles Lakers Phoenix Suns Sacramento Kings
- 6. NBA BREAKDOWN by Conference Eastern Conference Western Conference Atlantic Central Southeast Southwest Northwest Pacific
- 7. Trouble in the NBA Many NBA teams are consistently loosing money due to: Expenses exceed revenue generated Exorbitant salaries of players Fans aren’t buying tickets Bad economy
- 8. Top paid N.B.A. players in the league 1 Kobe Bryant, SF Los Angeles Lakers $25,000,000 2 Joe Johnson, SF Brooklyn Nets $24,894,863 3 LeBron James, SF Cleveland Cavaliers $22,970,500 4 Carmelo Anthony, SF New York Knicks $22,875,000 5 Dwight Howard, C Houston Rockets $22,359,364 6 Chris Bosh, PF Miami Heat $22,192,730 7 Chris Paul, PG Los Angeles Clippers $21,468,695 8 Kevin Durant, SF Oklahoma City Thunder $20,158,622 9 Derrick Rose, PG Chicago Bulls $20,093,064 10 Dwayne Wade, SG Miami Heat $20,000,000
- 10. Show me the money Not only do these guys collect big checks but they also bring in millions in food, entertainment, and clothing endorsements This directly impacts owners who do not share in those huge profits but pay big salaries to keep their star players who may lead their teams to the coveted N.B.A. Championship victory
- 11. What is a Concession According to the dictionary there are two variances of concessions One being an authorization and the other being a compromise
- 12. Concessions made in the N.B.A. Players moved from a 57-43 revenue split to about 50-50. The length of max contracts shrunk Increase in ticket prices and concession item, such as food and souvenirs
- 13. Collective Bargaining Agreement of the N.B.A. Consist of : I. SALARY CAP AND RELATED RULES II. Escrow and Tax Arrangement III. Free Agency IV. Anti Drug Agreement V. NBA DEVELOPMENT LEAGUE VI. Miscellaneous EXHIBIT A (Rookie Salary Scales) EXHIBIT B (Minimum Annual Salary Scale)
- 14. Impasse in Contract Negotiations A bargaining impasse occurs when the two sides negotiating an agreement are unable to reach an agreement and become hopelessly deadlocked. Typically an impasse is almost invariably mutually harmful to both sides either as a result of direct action which may be taken such as a strike or in the NBA would result in a lockout, as seen in 2011. Negative recourse/action in occurs resulting in delay in the negotiating of a mutually beneficial agreement
- 15. 2011 Lockout in the N.B.A. Method to split revenue: Owners are demanding the institution of a first-ever hard salary cap, set at $62 million, to roll back salaries by around 33%, or $800 million annually. Players want to continue the soft-cap system that lets teams exceed the cap when they re-sign their own players, but have offered to take $100 million in annual cuts. The cap now is $58 million. - Dividing the loot: Owners want at least a 50-50 split of revenue, although players contend that the owners’ proposal calls for them to get a 61-39 advantage at the end of a 10-year deal. Players get a 57-43 split now and want it to continue in a five-year deal. - What the players get: Owners say their proposal would give players the same $2 billion they make now in salaries and benefits. Owners contend players’ last proposal would give them in excess of $3 billion, while players dispute that but refuse to divulge their demands. - Guaranteed contracts: Owners have come off their demand to eliminate guaranteed deals entirely. They’re looking to reduce the 6- and 5-year deals to 5- and 3-year deals. Players want to continue getting 6-year deals for re-signing with their own teams and 5-year deals for joining a new team. - Guaranteed annual raises: Players presently get 10.5% if they re-sign with their own teams or 8% if they go to new teams. Although they haven’t announced their demands, owners want to slash those to 5% and 3%.
- 16. What is Contract Ratification In contract law, the need for ratification can arise in two ways: Where the agent attempts to bind the principal despite lacking the authority to do so Where the principal authorizes the agent to make an agreement, but reserves the right to approve it.
- 17. Contract Ratification process 1. IDENTIFYING & UNDERSTAND RESPONSIBILITIES OF PARTIES INVOLVED IN RATIFICATION PROCESS 2. Determine if ratification process is required 3. Begin drafting and finalizing supporting Contracting Officer information for the “Ratification Package” 4. Staff the package 5. Provide Written Notice of Ratifying Official’s Decision 6. Finalize any issuance of corrective contracting action 7. Distribution to all parties
- 18. NBA’s contract is ratified for 10 years to include The agreement includes a 50-50 split of basketball-related income, a higher luxury tax with progressive tax rates and the retention of a soft salary cap system. The maximum length of player contracts will be five years (previously six) and maximum annual increases in salaries will be 7.5% for teams re- signing their own players and 4.5% for teams signing other teams' free agents. On non-economic issues, the league has bolstered its drug program to include offseason testing, increased penalties for violations involving performance- enhancing drugs, and blood testing for human growth hormone (HGH) once the test is validated by a neutral panel of scientific experts.
- 19. AGREEMENT MADE
- 20. QUESTIONS WHEN BARGAINING NEGOTIATIONS, WHY DO FREE AGENTS COUNT AGAINST SALARY? IN BARGAINING NEGOTIONS, ARE INJURED PLAYERS APPLY TO A TEAM SALARY? IS THERE A MINIUM AMOUNT EACH TEAM MUST PLAY ITS PLAYERS IN BARGAING NEGOTIATIONS? HOW DOES PLAYERS AVOID BEING HELD HOSTAGE BY CRISIS NEGOTIATION?