NBA: Agent Revolt and Threat of Decertification

(By Robert Bradley, The Association for Professional Basketball Research) During the 1997-98 season the NBA owners voted to re-open the collective bargaining agreement, claiming losses by 13 teams. The union, now led by its new Patrick Ewing of New York and Executive Director William Hunter, is expected to meet owner demands (including greater authority for the Commissioner in disciplining the players, an inclusion of marijuana in the league’s drug testing and a hard salary cap), with resistance, citing the league’s new four-year $2.4 billion television deal with NBC and Turner Sports as a counter to the plea of poverty and looking to restore the league’s middle class and curb control of the Commissioner ability to impose punishment over players. Provisions in the television contracts guarantying the owners money even in the event of a work stoppage, and the failure of the rookie salary cap to curtail big contacts to young players may bring about a lockout during the summer and lead to the loss of games for the first time in the league’s history.

The owners best chance for control of the situation would bring a work stopage for the first time in the NBA as on July 1, 1998 the owners locked out the players. With the Larry Bird Exception softening the salary cap the league fought for a luxury tax and player salary limits to ensure more rigid cost control. After the loss of half of the season the players relented on maximum player salaries based on seasons played, and longer rookie contracts (now three years guaranteed with an optional fifth season). The owners also received a concession when the players agreed to an escrow tax in 2001-02 if salary expenditures exceed 55% of basketball related income. In exchange the players received increases in the minimum salary for veterans based on service, additional exceptions to the cap, and the continuation of the Larry Bird Exception. Commissioner Stern had met the objective given to him – further controls on costs in a clear victory over the union.

For more information on the current collective bargaining agreement visit Larry Coon’s Salary Cap FAQ Site at http://www.members.home.net/lmcoon/salarycap.htm.

 

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