As discussions on a new labor agreement continue, the NBA and National Basketball Players Association are expected to extend an early opt-out deadline of Wednesday, allowing the league and union to continue negotiations on a new long-term collective bargaining deal, sources told ESPN on Monday.
As the sides pursue an early labor deal, a significant part of what has allowed discussions to progress has been the NBA's willingness to soften from its original push for an upper spending limit on team payrolls -- a de facto hard cap, sources said.
The NBA's seven-year CBA expires after the 2023-24 season, but Wednesday's deadline -- already extended from Dec. 15 -- pushes back both sides' ability to opt out of the current deal on June 30 and risk the possibility of a lockout.
The NBA's board of governors voted Friday to give the league's labor relations committee the approval to give notice of a June 30 opt-out on a labor deal or extend that opt-out again, sources told ESPN. The league and union's expected decision to extend that date for a second time is rooted in the belief that there's enough common ground in discussions to keep pursuing an early labor deal -- without inviting the uncertainty that would come out of declaring an opt-out.
If the league or union opts out of the current deal effective at the start of free agency on that date, the league's business would shut down. Trades and free agent acquisitions would cease without a new labor agreement. The risk of losing regular-season games would begin in October.
The introduction of the upper spending limit into talks had been rooted in the desire of smaller-market teams to rein in the spending of franchises such as the Golden State Warriors, LA Clippers and Brooklyn Nets, sources said. In the wake of those large-market contenders accumulating outsize payrolls and luxury tax penalties, the NBA had proposed a system that would replace the luxury tax with a hard limit that teams could not exceed to pay salaries, sources said.