NBA salary policy
Labor and capital terms:
In the NBA, no matter whether a player trades, a team signs a free agent, or the league bans a player, there is a clause to be followed, that is, the labor and capital terms.
As we all know, the NBA actually belongs to the owners of various teams, and the players are expensive wage earners, so the players and the league (representatives of NBA owners' interests) have formed a relationship between labor and management. In the period when the NBA was just established, the interests of players were not fully protected as they are today. When the players realized that their own interests could not be guaranteed, they spontaneously organized a players' union, and the first president of the players' union was the Celtic famous Bob Cousy. After the presidents of Cousy, Tom Heinsohn and other trade unions, the NBA recognized the legitimacy of the players' union and signed labor terms with it. It was the efforts of the players' union that enabled today's players to get benefits such as retirement fund, daily allowance for players, health fund, basic salary guarantee and so on. It can be said that the predecessors planted trees and the descendants enjoyed the cool.
Only by understanding the players' union can we have a preliminary concept of the labor-capital clause: it is a contract negotiated between the players' union and the league. In this contract, all NBA players are employees, while the NBA (that is, the team owners, after all, the NBA belongs to them) is employers. The labor and capital clauses stipulate the salary cap, as well as the setting procedure of the salary cap, the basic salary and maximum salary of players, trading rules, draft procedures and hundreds of other functional clauses. The English name of labor terms is Collective Bargaining Agreement, so it is also called CBA for short.
The current labor terms and conditions were signed in June 25, which is a continuation of the labor terms and conditions from 1999 to 25. The current labor terms and conditions will be terminated after the end of the 21-211 season. The NBA has the right to extend it into the 211-12 season, but the league must decide whether to extend it for one year before December 5, 21. The current labor terms and conditions can also be terminated due to some unexpected factors, such as:
1. Some collusion (players' union can be terminated)
2. The income of NBA TV broadcasting has dropped significantly (NBA can be terminated)
3. The league cannot fulfill the terms and conditions due to some force majeure, and the NBA can be terminated (such as war or terrorism)
4. Federal legal arbitration (either party can terminate)
All along, players' unions and leagues have kept the habit of signing once every 6-7 years. Due to the conflict of interests between employers and employees, every time the validity period of labor and capital clauses approaches the end, both inside and outside the league often fall into a strange atmosphere. Once they fail to reach an agreement, it will probably lead to the sudden death of the NBA. The most famous event is the "museum closure" in the 1998-99 season.
As early as 1995, the labor and capital clause stipulated that when the total income of NBA players exceeded 51.8% of the league's total income, the NBA had the right to unilaterally terminate the agreement. However, in the 1997-98 season, the player's income accounted for 58% of the league's total income, which was much higher than the original figure, so the NBA naturally quit. Therefore, the NBA hoped to restrict the player's salary more, but the players' union refused, so there was a "closure". In fact, in the summer of 1996, the NBA produced three contracts worth 1 million yuan for the first time (Zhu Wan Howard, shaquille O 'Neill and alonzo Mourning), and with Garnett's amazing 127 million fat contract in the 1997-98 season, the players' salaries naturally turned red.
salary cap:
salary cap, which is a word familiar to fans, is also a magic spell on the heads of general managers of various teams. How did it come into being? Why do you need a salary cap? How is the salary cap set? These seemingly simple questions are actually answered after a long struggle between the NBA and the players' union.
why is there a salary cap? This question is easy to answer. The salary cap is to limit the total salary of players and ensure the dynamic balance of team competition. In other words, if there is no salary cap, the team's record will be largely determined by money. The basic purpose of salary cap is that a team can't exceed the salary cap when signing players. However, the NBA uses a soft salary cap, and teams can use other special cases to sign players when they exceed the salary cap, which will be answered in detail in the future.
since the 1946-47 season when the NBA was founded, the NBA has had a salary cap. At that time, the total salary cap of the team was only $55,, so the players' income was quite low. Most players earn only $4,-5, a year, while scoring champion Joe Folques earns only $8, a year. Tom King was a working emperor at that time, with an annual salary of $16,5, but he was a player, a public relations director and a business manager.
The modern salary cap originated from the 1984-85 season, when it was $3.6 million. In the future, the salary cap basically maintained the growth rate of $ 1-2 million per season. In the mid-199s, the salary cap experienced a rapid growth, because at that time, the NBA won a huge broadcast contract from NBC TV, which made the salary cap reach $23 million in the 1995-96 season. In short, the salary cap contract is based on a certain percentage of NBA-related income. The more money the NBA makes, the higher the salary cap, and the more money the players earn.
here you can introduce the concept of NBA related income, which is called Basketball Related Incom in English, or BRI for short. It includes regular season ticket income, playoff ticket income, broadcasting signing right income, exhibition game income (all-star game), franchise merchandise sales income of the team, parking fee, team sponsorship income, product promotion income of the team, arena income, summer training camp income, basketball match income of non-NBA organizations, mascot and cheerleading performance income, beverage sales right income, 4% arena signing income and 4% luxury box income. 45%-5% of the stadium naming rights income, other extra insurance income, and NBA ownership income including international TV broadcast, sponsorship fee, NBAE, all-star, McDonald's championship and NBA special events.
BRI is the basis for calculating salary cap. The NBA estimates the BRI of the new season in July every year, and then adjusts whether the BRI of last season is lower than the budgeted value, and then divides it by the number of league teams to get the salary cap. Here is a concrete example: For example, starting from July 1st, 28, the NBA began to budget the BRI for the 28-9 season, and then we will see whether the actual BRI for the 27-8 season is in line with the budgeted BRI (the budgeted BRI for the 27-8 season was calculated in the summer of 27, so it may be deviated from the actual BRI) and make adjustments. The budget period in July every summer is also called the freeze period. During this period, teams are not allowed to sign players.
Generally speaking, the salary cap is equal to 51% of BRI divided by the number of league teams (except for new teams, such as Bobcats, whose salary cap in the first two seasons was only $37.13 million, much lower than that of other teams' $49.5 million).
In addition, in order to prevent the team from tightening money and causing bad influence, the NBA also stipulates that if the total salary of the team is less than 75% of the salary cap, then the team will be punished by the league. However, the total salary of 8% NBA teams exceeds the salary cap, and most players sign contracts by citing special cases. Even for many teams, avoiding luxury tax is the most difficult thing.
Luxury tax:
Luxury tax, a word that scares NBA bosses, is deeply understood by Knicks boss Dolan. Simply put, luxury tax means that every time a team's salary exceeds the luxury tax line, it must pay another dollar to the league. Therefore, a team with a total salary above the luxury tax line needs to pay double the price for each player who signs up. In the summer of 28, the Warriors offered Turiaf of the Lakers a four-year, 17-million-dollar quotation contract. It was because of the Lakers' reluctance to pay double the price that they fell into trouble.
As mentioned above, the labor-capital clause is a peace agreement between the players' union and the boss. The salary cap is set to limit the team's operation "crossing the line", but the NBA implements a soft salary cap, which allows special cases to be cited above the salary cap, so it will inevitably bring about the "excessive" effect. How to control the team whose salary is above the salary cap? Luxury tax is one way, and before luxury tax, there is a third-party trusteeship.
according to the regulations of NBA, the total salary of players can't exceed 57% of BRI (basketball-related income mentioned in the last issue). In order to control the total salary of players, NBA introduced a third-party trust to deposit 1% (usually 8-1%) of players' salary into a third-party account. At the end of the season, the league will check whether the player's salary exceeds 57% of the BRI. If it does not exceed, the money deposited in the third-party account will be fully refunded to the player. If it exceeds 57% of the BRI, the excess will be paid to the boss by a third-party account (1% of the player's salary) and the rest will be returned to the player. When the total salary of players exceeds 57% of BRI so much that the salary of the third-party account is not enough to compensate the boss, it will be deducted next season. In the past seasons of 25-6, 6-7 and 7-8, the salaries deposited in third-party accounts were basically distributed to bosses and players.
In the past, the luxury tax appeared as an incidental product entrusted by a third party, that is, when the salary in the third party account is enough to pay the 57% excess of BRI, no matter how much a single team exceeds the luxury tax, it is not necessary to pay tax, and only when the third party account cannot pay the excess of players' salary will the luxury tax be triggered. However, in the current labor terms, luxury tax and third-party trusteeship are independent. The current labor terms stipulate that luxury tax must be paid as long as the team's total salary exceeds the luxury tax line, regardless of whether the third-party account is enough to compensate the player's salary. Bibi said that in the 27-8 season, Knicks, Mavericks, Cavaliers and Nuggets paid $19.7 million, $19.6 million, $14 million and $13.6 million respectively, but under the old labor terms, they didn't have to pay at all.
The luxury tax is similar to the salary cap. The budget is set before the new season (the old labor clause is after the season), but the proportion is slightly higher, which is 61% of BRI divided by the number of teams (the salary cap is 51%). For example, the luxury tax line in 28-9 season is 71.15 million US dollars, while the salary cap is 58.68 million US dollars. When calculating the luxury tax of the team, in addition to the salary part of the Amnesty clause, the player's salary, bonus and transfer transaction money will be included. In addition, the luxury tax ends on the last day of the regular season. For example, if Iverson is traded to the Pistons during the season, his salary will be erased from the Nuggets account when calculating the luxury tax, and all of it will be transferred to the Pistons (of course, Iverson's salary is paid by two teams. If the Pistons don't exceed the luxury tax line at the end of the season, then the Pistons naturally don't have to pay any taxes, which will not affect them).
who will get the luxury tax? First of all, the luxury tax will be divided into 3 equal parts, which will be basically distributed according to the following three principles: First, the team whose salary is below the luxury tax line will get a full tax, while the team above the luxury tax will not. Second, the remaining part or all can be reserved for alliance purposes; Third, the rest will be distributed to 3 teams on average, and teams above luxury tax will also have one. For example, in the 27-8 season, * * * received $92.45 million in luxury tax, and each team that did not exceed the luxury tax line received $3.8 million, leaving $24.65 million for league purposes.
player salary limit:
The salary cap is to limit the salary operation of the team, which indirectly limits the player's salary. So what are the restrictions on the player's salary in the NBA? Here will be divided into three types of contracts: 1-day short-term contract, basic salary guarantee, and maximum salary limit (the annual salary of the first round of rookie contracts is formulated in strict accordance with the order, which will be discussed separately). The current labor terms and conditions also stipulate that the longest term of a player's contract is six years (previously seven years), but it is limited to the Byrd clause (which will be explained in detail in the future), and the longest term of other contracts is five years.
1-day short-term contract: it means that the contract between the player and the team can only last for 1 days (or three games, whichever is longer). In a single season, the team can sign two 1-day short-term contracts for a player continuously or discontinuously. But if you want to sign a third contract, you must leave the team until the end of the season, that is, you can only sign two 1-day short-term contracts at most. The short-term contract will take effect after January 5 of each season.
basic salary: the basic salary is a regulation to protect marginal players. The size of the basic salary contract increases with the age of the ball. The basic salary of each ball age group has been indicated in the labor terms and conditions. For example, in the 28-9 season, the basic salary of a player with a ball age of was $442,114, the basic salary of a player with a ball age of one year was $711,517, and the basic salary of a player with a ball age of two years was $797,581. Therefore, even if the Lakers signed a contract with a basic salary of two years in Sun Yue, we know that Sun Yue's contract was $1,153,631 for two years. The basic salary of players with 1 years of age or above is $1,262,275. For example, the Nuggets signed veteran Anthony Carter with a basic salary in the summer of 28, and his contract is $1.26 million a year.
for veterans who have fought in the league for many years, the NBA is also full of human feelings. For example, for fear that the team is unwilling to sign a veteran with a basic salary (because the basic salary contract of the veteran is relatively large), the NBA stipulates that if a veteran with three or more years of experience signs a one-year basic salary or a 1-day short-term contract with the team, then the NBA will only count the contract as a two-year basic salary contract and include it in the salary cap. Still taking Anthony Carter as an example, Carter's annual salary of 1.26 million is actually only $798, (a two-year basic salary contract) included in the team salary of the Nuggets. We often see that the basic salary contract signed by veterans is only one year, because the team wants to save a sum in calculating the team's salary, so as to have more salary space to operate.
Maximum salary limit: The NBA also has a limit on the fixed salary of players, and the maximum salary contract also increases according to the growth of the age of the ball. We often see that the contracts of some veterans in the NBA who have become benches for ten thousand years due to physical decline are surprisingly large, approaching the level of 2 million, which is the reason. The general maximum salary is set as follows: the maximum salary of players with -6 years of age is 9 million and the "salary cap" of 25% (this "salary cap" is slightly smaller than the team's salary cap) is larger; The maximum salary contract for 7-9 years old players is 11 million and 3% of the "salary cap", and for more than 1 years, it is 14 million and 35% of the "salary cap". In the 28-9 season, the top salary contracts of NBA players in these three age groups are as follows: 1