NBA Labour talks witness some progress; next meeting due to Friday – Basketball Update
The much hyped Tuesday’s meeting between the league officials, owners of NBA teams and the National Basketball Players Association produced some movement on certain key issues. The meeting had been described as a critical one by
the NBA Commissioner David Stern beforehand.
However, a key sticking point was also revealed in the form of the argument over the proposed hard salary cap. The owners are insistent that they have offered a “flex” cap, a little upgrade from the soft cap that applies in the
current CBA or Collective Bargaining Agreement.
The players have rejected the idea of a flex cap, saying it is still a hard cap. The current cap allows a team to pay a certain amount to its players; however that amount is then bracketed. What that means is the teams have a minimum
threshold and a maximum threshold for variance in the targeted salary. Once over the maximum, teams have to pay a luxury tax.
The flex cap proposed by the owners is similar but differs in the fact that once the maximum threshold is reached, the teams will be restricted in signing players, i.e. they cannot exceed the maximum threshold in any circumstances.
This has irked the players who have termed it a hard cap. The league and the players need to agree on a new CBA before the old one expires on June 30, but they would be lucky to find a solution by then.
Still there was some progress made in other areas. The owners took back their original proposal to roll back player salaries by $750 million over the next four years. This means the players will still get $2.1 billion, or more,
as they did this year in salaries.
The league though has announced that 22 of its 30 teams suffered losses this past season and they are looking at ways to recover. The owners seem to be targeting BRI or Basketball Related Income. BRI is currently split 57-43 between
the players and the owners. The owners want more share but the players are not willing to give them that.
The league has thus come up with proposals to redefine what actually constitutes the BRI. There is still a long way to go but NBA Commissioner David Stern said that he was happy with the meeting and that the owners made a very
good offer to the players,
"We made what we think is a very significant offer to the players to avoid a work stoppage," Stern said after Tuesday's session. "This is virtually the best shot we think we have to both demonstrate to the players our good faith
[and] our desire to go as far as we can to avoid a lockout."
The ball is now in the player’s court and it is to be seen how they will respond to the owner’s proposals.
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