Featured Blog Post

Tuesday, June 21, 2011

Legal issues behind the NBA lockout

The current CBA (Collective Bargaining Agreement) between the owners and the players
of the NBA is set to expire on June 30, 2011. Just like football, if a resolution is not reached during this off season the next season will be at risk of being shortened or canceled. We have all seen how the NFL lockout has played out when the negotiations broke down and the litigation begun. It has been a very messy situation and the parties involved with the NBA will avoid following in those footsteps if they know what’s good for them.

There are several issues that have led to the current dispute between the NBA players and the owners. The most significant issue has been that many NBA owners claim they are in the red and that the league as a whole is losing money. Owners want to increase their portion of basketball related income. The players currently get 57% and the owners get 43%. The implementation of a hard salary cap as opposed to the current soft salary cap is also a big issue. The owners are also looking to cut player salaries by about one third and shorten the length of contracts while eliminating exceptions like signing bonuses or deferred compensation. NBA Commissioner, David Stern, has recently proposed a “flex cap” which would allow richer teams to exceed the target of $62 million per team but this proposal has been opposed by the players and legal analysts have been skeptical that anything other that a hard salary cap would be effective.

Hopefully the two sides can agree soon because 2 major professional sports lockouts in one year could have a devastating impact on an already struggling economy.

Image Sources: