NBA Lockout Update: 5PM Deadline Looms Large

With each passing day, the fears grow – will the NBA lockout ever end? Later today, we will have some more clarity.

At 5 p.m. another deadline will come upon the lockout. The players have rejected the latest offer from the owners, but there will be one more bargaining session today before the lockout drags out further. This deadline looms large, as David Stern has held that the amount the owners are willing to share will drop up to four percent if a deal cannot be reached.

The players are adamant they will not be strong-armed by the owners. The split under the previous CBA was 57-43 in favor of the players; the split currently on the table is a sliding scale between 49 and 51 for each side, depending on the profits. Forecasters for the players say that the maximum they could expect under the new proposal is 50.2% of the profits, an incredibly significant drop from last year.

The union was actually given permission to go as low as 50% this past week, a large concession on the part of the players. So, done deal, right? Unfortunately, no. There are multiple other points the players will not concede, as they already believe they are giving up too much.

The other issues mainly revolve around the salary cap. The owners want to increase the luxury tax significantly and have penalties for repeat violators of the luxury tax. The owners believe this would increase parity in the league and lower the competitive advantages of being able to create super teams in bigger markets. What should they do Lebron? Should they admit that they’ve made mistakes? Should they admit that they’ve been there before? What should they do? (And, end Lebron rant).

The players, however, want to have the choice of where they go and create super teams if that’s what they want. They do not believe it is fair to have a harder salary cap that restricts where they can move during free agency and what players can be brought in to join their teams.

Similarly, the owners want to help the disparity between the haves and the have-nots shrink even further by making more barriers to acquiring a player by use of the mid-level exception (MLE) by teams already violating the luxury tax. The MLE allows teams to add a player at one time during the year for a specific mandated salary number without the player’s salary counting against your salary cap. The owners want this number to be smaller and for a shorter term of years for teams above the luxury tax than for those not in violation, thus making teams over the tax less attractive than non-violators to potential MLE candidates.

With this in mind, the players are warming up to the idea of a near 50/50 split if they get their demanded concessions in some of these other areas discussed.

Now, where are we currently? The league owners proposed the 50/50 split with the owners demanding the other disparity lessening measures. The players formally rejected that offer yesterday. David Stern has threatened to lower the 50/50 offer to 53/47 in favor of the owners with a hard salary cap (think NFL) if no deal is reached by 5 p.m. today. There will be a mediation between both sides all day today.

Here is where we are headed.

There are factions forming on both sides. Some owners do not want to go to the near 50/50 split and want the owners to hold strong at a 53/47 split in favor of the owners. It sounds as though the very slight majority is ok with the 50/50 split proposal, hence the offer being on the table. Michael Jordan is one of the vocal leaders of the 53/47 movement.

On the players’ side, there are two factions as well. Some are willing to concede pretty heavily to get a season, hence the players having approval for a 50/50 split if they receive other concessions. Others want the players to hold out for more and are willing to do anything, including decertification, to meet their demands.

The players who want the 50/50 split seem to just want the deal done and to start playing. Those players considering decertification are prepared to lose the season if it means a better deal will come of it. Decertification is a process where the union disbands, thus allowing antitrust lawsuits against the league. 30% of the players must sign a petition for decertification and then there is a 45-day waiting period during which negotiations could still take place.

There is a huge risk/reward balance that must be done before decertification. If the players move for it, the owners may budge on their firm views for fear of lawsuits. However, the players will put the season in serious jeopardy by moving for this process. Many players are prepared for that, but I would imagine a substantial amount of players do not want to miss an entire year of paychecks. This could cause a major rift among the players and put the owners in position to exploit potential infighting.

With all of this information, will the lockout come to an end anytime soon? Ask me again at 5 p.m., but I still may have no clue. All I know is we could all use a little Sixers basketball right now with our city hurting a bit. They were a lot of fun to watch overachieve under Doug Collins last year and it would be great to see what the new owners roll out this year.