After a nine-hour meeting with the help of a federal mediator, the National Basketball Association has offered its players a new labor proposal. The NBA has already lost $200 million this year by canceling the preseason, with the regular season now at serious risk.
The proposal includes an opportunity for the players to earn between 49 percent and 51 percent of basketball-related income, depending upon league growth, explained NBA Commissioner David Stern at a press conference.
In addition, the NBA also put in five suggestions by the mediator regarding the league’s system. If they are not accepted, the league could go back to offering its players a “flex cap”, which would limit the highs and lows of the salary cap.
The proposal has a November 9 deadline for acceptance. Should the proposal be declined, it will be canceled and replaced with a less desirable offer. This will include a drop to 47 percent for basketball-related income.
According to a union attorney, the proposal was deemed unacceptable by the National Basketball Players Association and considered by the players as an attempt to “strong-arm” them.
During their most recent discussions, the two sides were 2.5 percentage points apart. The league offered a 50/50 division of basketball-related income while the players sought 52.5 percent.
In the previous labor deal, the players made 57 percent. Last season, the league’s owners lost $300 million while the NBA saw $4.3 billion in revenue during this same time.
Stern said of the new proposal,
“We want to allow enough time for the union to consider our most recent proposal and we are hopeful that they accept it,” Stern said. “But it doesn’t aid the negotiation process to just leave it hanging out there, so we’ve indicated where we’ll be going if we can’t make a deal.”
Some companies tied to the NBA include Madison Square Garden Inc. (NASDAQ:MSG), Anheuser-Busch Inc.(NYSE:BUD), and Nike Inc. (NYSE:NKE), as well as News Corp.(NASDAQ:NWSA), Comcast (NASDAQ:CMCSA), CBS Corp.(NYSE:CBS), The Walt Disney Company (NYSE:DIS), and DirecTV (NASDAQ:DTV) all of which broadcast NBA games on their networks, which include Fox, NBC, CBS, ABC, and ESPN.