NBA lockout: Why was the pay deal refused and what next?
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With the NBA players’ decision to reject the league’s latest offer, the multi-billion dollar game of chicken has officially ended in a crash. The players have disclaimed their union — effectively ending its right to negotiate on their behalf — and basketball’s labor conflict will move from hotel rooms to courtrooms, putting the 2011-12 season in serious jeopardy. So how did we get here, and is there hope that anyone can untie the Gordian Knot in these high-tops?
THE ISSUESWhether it’s about crossing guards or point guards, labor disputes always come down to money — the NBA lockout just involves a lot more.
The current work stoppage — the fourth in league history — began on July 1, 2011, when the previous collective bargaining agreement (CBA) ended after six years. The CBA is the labor blueprint (setting salaries, rules for trades, etc) between the players and the owners.
Without a collective bargaining agreement with the players, the NBA would be subject to America’s antitrust laws, which protect against monopolies.
In the months leading up to the expiration of the CBA, the owners and the players’ union attempted to negotiate a new deal in order to avoid a strike. When the two sides failed to reach an agreement by June 30, the owners declared a lockout and the brinksmanship began. Here’s what’s at stake:
Revenue sharing
In simple terms, the owners claim that they are losing money. Not all of them, but most. When the labor negotiations began, NBA commissioner David Stern said that 22 of the league’s 30 teams expected to lose a combined $340m this season. Though Stern did not say which franchises would lose money, it is presumed that the small-market teams — such as the Indiana Pacers or Denver Nuggets — suffer more because, unlike the NFL, the NBA does not have revenue sharing.
Salary cap
To create greater parity in the league due to the revenue-sharing imbalance, the owners want to impose a so-called “hard salary cap,” which fixes the total amount each team can spend. (You can’t afford to keep Kobe Bryant next year? Sorry, Lakers, you may have to unload Lamar Odom to make room in the budget.) Naturally, the players are vehemently opposed to a hard cap. Then again, so were the NHL’s players. That league’s owners fought for a hard cap for years and didn’t get one until a lockout in 2004-5 caused the cancellation of the entire season. Sound familiar?
The players, in return, want to keep the current system in place — the so-called “soft cap” — which imposes a “luxury tax” on a team if its total salary exceeds a certain amount. (And there are always ways around that amount.) The luxury tax is then shared with the other teams that didn’t overspend.
Similarly, the owners also want to impose a limit on the size and length of NBA contracts so that teams are not burdened by expensive stars who flame out.
Basketball-related income This is seemingly the heart of the NBA lockout. Under the collective bargaining agreement that expired in June, the players received 57% of basketball-related income (BRI) — ticket sales, TV contracts, concessions, etc — while the owners received 43%. When the negotiating began, the players agreed to split BRI 53-47. They later dropped that figure to 52.5%, but the owners have been adamant in achieving a 50-50 split. The players have been united in rejecting such a proposal.
THE PLAYERS
Founded by Bob Cousy of the Boston Celtics, the National Basketball Players Association (NBPA) has been the players’ union in the NBA since 1954. Its current president, Los Angeles Lakers point guard Derek Fisher, and executive director, Billy Hunter, have been leading the negotiations for the players.
But on Monday, when the players rejected the owners’ most recent offer, the NBPA announced its intention to disband the union and sue the league for anti-trust violations. While such a move theoretically ends any hope of an NBA season – because it moves from negotiation to litigation – it is by no means irreversible. Disclaiming the union also doesn’t prevent individual players from negotiating with individual teams, though this scenario is unlikely.
Instead, the players will now have their outside attorneys, Jeffery Kessler and David Boies, put a full-court legal press on the owners by filing an anti-trust claim.
THE OWNERS
David Stern joined the NBA in 1978 as its general counsel, and has been its powerful league commissioner since 1984. While he has been instrumental in transforming the NBA brand over the past three decades, many now blame him for mishandling the negotiations with the players’ union. In October, Bryant Gumbel, host of HBO’s Real Sports, injected a racial element into the lockout debate.
“The NBA’s infamously egocentric commissioner seems more hell-bent lately on demeaning the players than solving his game’s labor impasse,” Gumbel said in an on-air editorial. “Stern’s version of what has been going on behind closed doors has of course been disputed, but his efforts were typical of a commissioner who has always seemed eager to be viewed as some kind of modern plantation overseer, treating NBA men as if they were his boys.”
WHAT HAPPENS NEXT?
When the players’ association voted to dissolve the union on Monday, David Stern issued a dire forecast: “We’re about to go into the nuclear winter of the NBA and it’s very sad,” the commissioner said.
Stern’s apocalyptic language confirms the owners’ worst fears — in disclaiming the union, the players have shifted the dispute from a labor conflict to an anti-trust issue. In the next few days, David Boies and Jeffrey Kessler will file an anti-trust suit against the league (most likely in New York, though not necessarily) and then it moves to the legal arena. While such a case could be heard as early as January or February, there is no guarantee that a lawsuit will move swiftly through the system, particularly if the two sides battle over a venue.
Similarly, the players are taking a risk by dissolving their union because the tactic will effectively end the 2011-12 season, and the league has threatened that such a move would void all current contracts, making every player a free agent. (Though that latter scenario doesn’t seem to have a lot of legal basis.)
In the end, the nuclear option — the threat of lengthy lawsuits and massive damages for antitrust violations — could force the NBA back to the negotiating table to work on a new collective bargaining agreement, but this would require the players to re-form their union.
Until then, basketball fans are left feeling like Charlton Heston at the end of Planet of the Apes: “You maniacs! You blew it up!”
Culled from Guardian
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NBA lockout: Why was the pay deal refused and what next?
Category: Sports Written by - Hits: 416
THE BIG PICTUREWith the NBA players’ decision to reject the league’s latest offer, the multi-billion dollar game of chicken has officially ended in a crash. The players have disclaimed their union — effectively ending its right to negotiate on their behalf — and basketball’s labor conflict will move from hotel rooms to courtrooms, putting the 2011-12 season in serious jeopardy. So how did we get here, and is there hope that anyone can untie the Gordian Knot in these high-tops?
THE ISSUESWhether it’s about crossing guards or point guards, labor disputes always come down to money — the NBA lockout just involves a lot more.
The current work stoppage — the fourth in league history — began on July 1, 2011, when the previous collective bargaining agreement (CBA) ended after six years. The CBA is the labor blueprint (setting salaries, rules for trades, etc) between the players and the owners.
Without a collective bargaining agreement with the players, the NBA would be subject to America’s antitrust laws, which protect against monopolies.
In the months leading up to the expiration of the CBA, the owners and the players’ union attempted to negotiate a new deal in order to avoid a strike. When the two sides failed to reach an agreement by June 30, the owners declared a lockout and the brinksmanship began. Here’s what’s at stake:
Revenue sharing
In simple terms, the owners claim that they are losing money. Not all of them, but most. When the labor negotiations began, NBA commissioner David Stern said that 22 of the league’s 30 teams expected to lose a combined $340m this season. Though Stern did not say which franchises would lose money, it is presumed that the small-market teams — such as the Indiana Pacers or Denver Nuggets — suffer more because, unlike the NFL, the NBA does not have revenue sharing.
Salary cap
To create greater parity in the league due to the revenue-sharing imbalance, the owners want to impose a so-called “hard salary cap,” which fixes the total amount each team can spend. (You can’t afford to keep Kobe Bryant next year? Sorry, Lakers, you may have to unload Lamar Odom to make room in the budget.) Naturally, the players are vehemently opposed to a hard cap. Then again, so were the NHL’s players. That league’s owners fought for a hard cap for years and didn’t get one until a lockout in 2004-5 caused the cancellation of the entire season. Sound familiar?
The players, in return, want to keep the current system in place — the so-called “soft cap” — which imposes a “luxury tax” on a team if its total salary exceeds a certain amount. (And there are always ways around that amount.) The luxury tax is then shared with the other teams that didn’t overspend.
Similarly, the owners also want to impose a limit on the size and length of NBA contracts so that teams are not burdened by expensive stars who flame out.
Basketball-related income This is seemingly the heart of the NBA lockout. Under the collective bargaining agreement that expired in June, the players received 57% of basketball-related income (BRI) — ticket sales, TV contracts, concessions, etc — while the owners received 43%. When the negotiating began, the players agreed to split BRI 53-47. They later dropped that figure to 52.5%, but the owners have been adamant in achieving a 50-50 split. The players have been united in rejecting such a proposal.
THE PLAYERS
Founded by Bob Cousy of the Boston Celtics, the National Basketball Players Association (NBPA) has been the players’ union in the NBA since 1954. Its current president, Los Angeles Lakers point guard Derek Fisher, and executive director, Billy Hunter, have been leading the negotiations for the players.
But on Monday, when the players rejected the owners’ most recent offer, the NBPA announced its intention to disband the union and sue the league for anti-trust violations. While such a move theoretically ends any hope of an NBA season – because it moves from negotiation to litigation – it is by no means irreversible. Disclaiming the union also doesn’t prevent individual players from negotiating with individual teams, though this scenario is unlikely.
Instead, the players will now have their outside attorneys, Jeffery Kessler and David Boies, put a full-court legal press on the owners by filing an anti-trust claim.
THE OWNERS
David Stern joined the NBA in 1978 as its general counsel, and has been its powerful league commissioner since 1984. While he has been instrumental in transforming the NBA brand over the past three decades, many now blame him for mishandling the negotiations with the players’ union. In October, Bryant Gumbel, host of HBO’s Real Sports, injected a racial element into the lockout debate.
“The NBA’s infamously egocentric commissioner seems more hell-bent lately on demeaning the players than solving his game’s labor impasse,” Gumbel said in an on-air editorial. “Stern’s version of what has been going on behind closed doors has of course been disputed, but his efforts were typical of a commissioner who has always seemed eager to be viewed as some kind of modern plantation overseer, treating NBA men as if they were his boys.”
WHAT HAPPENS NEXT?
When the players’ association voted to dissolve the union on Monday, David Stern issued a dire forecast: “We’re about to go into the nuclear winter of the NBA and it’s very sad,” the commissioner said.
Stern’s apocalyptic language confirms the owners’ worst fears — in disclaiming the union, the players have shifted the dispute from a labor conflict to an anti-trust issue. In the next few days, David Boies and Jeffrey Kessler will file an anti-trust suit against the league (most likely in New York, though not necessarily) and then it moves to the legal arena. While such a case could be heard as early as January or February, there is no guarantee that a lawsuit will move swiftly through the system, particularly if the two sides battle over a venue.
Similarly, the players are taking a risk by dissolving their union because the tactic will effectively end the 2011-12 season, and the league has threatened that such a move would void all current contracts, making every player a free agent. (Though that latter scenario doesn’t seem to have a lot of legal basis.)
In the end, the nuclear option — the threat of lengthy lawsuits and massive damages for antitrust violations — could force the NBA back to the negotiating table to work on a new collective bargaining agreement, but this would require the players to re-form their union.
Until then, basketball fans are left feeling like Charlton Heston at the end of Planet of the Apes: “You maniacs! You blew it up!”
Culled from Guardian