• Hunter Parsons

The $30 Million Problem in the NBA’s Collective Bargaining Agreement


With the 75th NBA regular season officially complete, it is once again time to argue over who should be named the league’s best players. To fans, it’s a fun way to debate with friends and show off what they heard on their favorite NBA podcasts. However, for players, the announcement of All-NBA, Defensive Player of the Year (DPOY), and Most Valuable Player (MVP) award winners can make life-changing increases to their earning potential.[1] Unfortunately, it is those outside of the game who are given the power to make those life-altering decisions. And now, it’s time for the league to address this issue.[2]


Under the NBA’s current Collective Bargaining Agreement (CBA), players who are finishing their rookie contracts are typically allowed to earn a maximum salary of 25% of the salary cap in the first year of their next deal followed by annual raises.[3] However, certain players may earn up to 30% if they can meet at least one of the “Max Criteria” provided in the CBA.[4] Additionally, players finishing their rookie extensions are able to move up to 35% of the salary cap if they meet the Max Criteria during that extension.[5] The Max Criteria are as follows:[6]

  • The player was named to the All-NBA First, Second, or Third team in the most recent season, or both of the two seasons preceding the most recent season.

  • The player was named the DPOY in the most recent season, or both of the two seasons preceding the most recent season.

  • The player was named the NBA MVP in any of the three most recent seasons.

While 5% may not initially seem like much of a jump, for the league’s top young players, that difference can amount an additional $30 million or more earned over 4-5 years.[7] As most drafted players entering the league are limited to lower, entry level salaries of only a few million dollars, a major payday like this can set their families for life.[8] Below are max contracts at each percentage threshold if signed this offseason with 8% raises, showing the difference each new level can make:[9]



With each new threshold increasing the contract’s total value by $35,380,000, it’s easy to see the impact that one deal can have on a player’s life. Obviously, for a lot of players, more opportunities to receive major contracts will come in the future. However, like any sport, staying injury-free or even relevant in a constantly changing game makes the future uncertain for everybody. One famous example of this lesson is the unfortunate story of DeMarcus Cousins. Halfway through the 2017-18 NBA season, Cousins was averaging 25 points and a career-high 13 rebounds per game, landing him his fourth All-Star selection.[10] The 2x All-NBA center was set to become an Unrestricted Free Agent that coming summer with a $200 million max contract most likely waiting for him.[11]

However, in the last week of January 2018, Cousins suffered a torn left Achilles, ending his season and hopes for a max contract.[12] In the four years following his injury, Cousins played for six different NBA teams, averaging a mere 10 points and 6 rebounds per game.[13] Instead of $200 million guaranteed, Cousins earned just over $13 million total in that span, showing the significance of players inking the bigger contracts as fast as possible.[14][15]


As only one player is designated the DPOY and MVP, respectively, each season, All-NBA selection is the most common route for any player to move into the next level of earning potential.[16] Each of the three All-NBA teams is comprised of two guards, two forwards, and one center, essentially representing the top 15 players in the league that season, voted on by 100 basketball writers from around the world.[17] While the league selects the voting writers equally across all NBA and international markets (thus in theory giving no player a home team bias) it is impossible to ignore the remaining human partiality.[18]


Boston Celtics forward Jayson Tatum expressed his displeasure with the system following his All-NBA rejection last season: “[T]here’s no criteria set for the media, for the voters on who they should vote for. It’s all opinion-based . . . [T]here’s just a little too much on the line for that.”[19] After making his first All-NBA team in 2020, Tatum signed a max rookie contract extension with the Celtics containing a built-in provision raising his salary from 25% to 30% of the cap should he meet the Max Criteria.[20] After failing to make an All-NBA team in 2021, the then 22-year-old recalled one of the voting writers citing his distaste of Tatum’s shot selection, a very subjective subject, as his reason for leaving him off his All-NBA ballot.[21] NBA agent Mark Bartelstein commented on the topic, saying that “[y]ou’d be naïve to think politics doesn’t play into a lot of these decisions.”[22]


However, even the NBA media itself has expressed their distaste for the process. Sports Illustrated senior writer Howard Beck stated, “It’s not appropriate. It’s not wise. And it certainly puts [the media] in an awkward position that we frankly never were consulted about before we were put in this position.”[23] Beck’s thoughts have been echoed across multiple other major NBA media sites including The Oklahoman and The Athletic.[24] While there are certainly many NBA writers with years of valid experience to apply to the voting process, the fact remains that players’ career earnings rest on the opinions of people who look on from the outside, rather than on the teams and coaches who work with players every day.


So, if both sides don’t like the current system, what’s the remedy? Tatum advocated for the use of statistical thresholds, giving more players the ability to reach the next level on their own terms.[25] However, opponents pointed out the concern of players intentionally “stat padding” to reach the benchmarks, rather than focusing on winning.[26] Others have discussed moving the voting power to team executives and coaches, a group the league has already embraced for All-Star Reserve voting.[27] Nevertheless, this still maintains an opinion-based system, bound to upset the next Jayson Tatum in years to come.[28]


Therefore, the best route for the league is to eliminate the Max Criteria designation entirely. At the end of the day, the decision to actually give max contracts to players lies with the teams.[29] Who is to tell them how to spend their money? The current CBA is set to expire following the 2023-24 season, giving the league and players’ union two years to prepare for the system’s possible re-negotiation.[30] Hopefully, come the 2024-25 season, young players are rewarded salaries that reflect the thoughts of those within the league, rather than the opinions of journalists whose jobs are to ask questions, not make decisions.


References

[1] Berry Tramel, Media shouldn’t be voting on NBA awards that determine super-max eligibility, The Oklahoman (May 24, 2019), https://www.oklahoman.com/story/sports/columns/berry-tramel/2019/05/24/media-shouldnt-be-voting-on-nba-awards-that-determine-super-max-eligibility/60454203007/ [2] Id. [3] Larry Coon, Larry Coon’s NBA Salary Cap FAQ, cbafaq.com (n.d.), http://www.cbafaq.com/salarycap.htm#Q24 [4] Id. [5] Id. [6] Id. [7] Mike Vorkunov, All-NBA teams are a great honor. They also present issues for players – and writers: Basketball Business Digest, The Athletic (March 30, 2022), https://theathletic.com/3214430/2022/03/30/all-nba-teams-are-a-great-honor-they-also-present-issues-for-players-and-writers-basketball-business-digest/ [8] Spotrac, NBA 2021-2022 Rookie Scale, spotrac.com (n.d.), https://www.spotrac.com/nba/cba/rookie-scale/ [9] Coon, supra. [10] Basketball Reference, DeMarcus Cousins, basketball-reference.com (n.d.), https://www.basketball-reference.com/players/c/couside01.html [11] Scott Davis, We’re learning more about the stunning DeMarcus Cousins trade, and it sounds like it came down to a $209 million decision, Business Insider (February 21, 2017), https://www.businessinsider.com/kings-demarcus-cousins-trade-209-million-decision-2017-2 [12] NBA.com Staff, New Orleans Pelicans center DeMarcus Cousins (Achilles) out for season, NBA (January 26, 2018), https://www.nba.com/news/new-orleans-pelicans-demarcus-cousins-helped-court-after-leg-injury [13] Basketball Reference, supra. [14] Id. [15] Oleh Kosel, Elton Brand confession about personal Achilles injury looms ominously over DeMarcus Cousins remaining career, SBNation (January 29, 2018), https://www.thebirdwrites.com/2018/1/29/16711114/demarcus-cousins-elton-brand-achilles-injury-looms-ominously-kobe-bryant-rudy-gay-wesley-matthews [16] Danny Funt, Journalists’ $80 million vote, The Week (May 25, 2021), https://theweek.com/articles/982664/journalists-80-million-vote [17] Vorkunov, supra. [18] Id. [19] Dan Feldman, Jayson Tatum: Too much money on the line for media voting to determine super-max eligibility, NBC Sports (February 24, 2022), https://nba.nbcsports.com/2022/02/24/jayson-tatum-too-much-money-on-the-line-for-media-voting-to-determine-super-max-eligibility/ [20] Luke Adams, Jayson Tatum Questions Super-Max Qualification Process, Hoops Rumors (February 18, 2022), https://www.hoopsrumors.com/2022/02/jayson-tatum-questions-super-max-qualification-process.html [21] Feldman, supra. [22] Funt, supra. [23] Feldman, supra. [24] Vorkunov, supra.; Tramel, supra. [25] Feldman, supra. [26] Id. [27] Yash Matange, NBA All-Star Game: Who votes for the reserves?, The Sporting News (February 2, 2022), https://www.sportingnews.com/us/nba/news/nba-all-star-game-who-votes-for-reserves/qpxkr1j6q1ar1kbeknmkzwq96 [28] Tramel, supra. [29] Id. [30] Sam Quinn, NBA unlikely to follow MLB’s lead with a lockout when current CBA expires after 2023-24 season, per report, CBS Sports (March 3, 2022), https://www.cbssports.com/nba/news/nba-unlikely-to-follow-mlbs-lead-with-a-lockout-when-current-cba-expires-after-2023-24-season-per-report/