NBA AM: Owners, Players Turn To Mediation
The NBA and players union have failed to come to terms in solidifying a new collective bargaining agreement over the past two years leading to the league imposed lockout July 1, the postponement of training camps and now the cancellation of the first two weeks of the 2012 season.
The ongoing labor dispute is forecasted to become even more contentious and ugly battle before experiencing a turn for the better.
The owners are projected to lose close $90 million in ticket revenues alone for cancelling the first 100 games of the season while the players stand to lose nearly $400 million for every month there’s no NBA action.
With talks at an impasse both sides have agreed to bring in an independent third party into the discussions to help them get over the proverbial hump..
The NBA and players will utilize the exact same federal mediator who was involved in trying to resolve the National Football League’s (NFL) labor dispute earlier this year.
Starting next Tuesday George Cohen, who serves as the director of the Federal Mediation and Conciliation Service, will oversee the negotiations between the players association and the NBA.
“I have participated in separate, informal, off-the-record discussions with the principals representing the NBA and the NBPA concerning the status of their collective bargaining negotiations,” Cohen said in a statement issued by the Washington-based FMCS.
Back in February and March of this year Cohen participated in labor talks between the NFL owners and its players over a two-week time period but wasn’t able to close the gap in their respective dispute.
Cohen clearly understands what at stake.
In a time when most focus only on the long term impacts to owners, players and to a lesser extent fans, the experienced mediator knows the labor dispute extends much deeper into the country’s economic realm.
“It is evident that the ongoing dispute will result in a serious impact, not only upon the parties directly involved, but also, of major concern, on interstate commerce — i.e., the employers and working men and women who provide services related to the basketball games, and, more generally, on the economy of every city in which those games are scheduled to be played,” Cohen said.
The NBA is indeed big business to local businesses.
According to a recent Wall Street Journal report, the Dallas Mavericks generated close to a $15 million economic benefit to the city of Dallas from hosting three NBA Finals games in June.
Another example, the Memphis Grizzlies attract over 40,000 visitors into the Memphis’ downtown for every home game which fuels businesses like bars, restaurants, parking garages and independent security contractors to name a few.
While the split of basketball related income has received the majority of the press, the true issue which could be stalling the talks is the players’ insistence on leaving the salary cap structure unchanged.
According to players union attorney Jeffrey Kessler the gap in revenue is close enough to overcome, but disagreements on how to handle the salary cap is holding up action from returning to the hardwood.
“The numbers are close enough that that wasn’t going to doom the season. The hard salary cap is what’s going to doom the season right now,” Kessler said earlier this week. “That’s the sticking point, because the numbers are close enough that if there was a fair system, the parties would find a way to get there.”
In essence the players have agreed to concede valuable percentage points in BRI in a new CBA and this means the transfer of $1 billion dollars back to owners over the next six years, but the league’s focus has shifted to ensuring a more competitive balance on the court – which means changes to the current salary cap system.
The owners first proposed a hard cap system which would remove popular exceptions which allow teams to spend over the cap. The players have voiced their displeasure with such a system all throughout the lockout.
Sources close to the situation say the league has since focused on strengthening the luxury tax penalty. Currently a franchise must pay a dollar for dollar penalty for every dollar spent above the threshold.
Sources say in order to create parity and reign in some of the big spenders in larger markets a penalty of $6 or higher for every dollar spent over the luxury tax threshold is needed.
100 Percent Healthy, Says Jonas Jerebko: Detroit Pistons power forward Jonas Jerebko missed all of last season due to a partially ruptured Achilles tendon suffered in the team’s first exhibition game.
Jerebko, the No. 39 overall pick in the 2009 draft, was coming off of a promising rookie campaign where he averaged 9.3 points and 6 rebounds per night and was figured to earn a heavy workload in Detroit’s thin frontcourt until the injury bug struck. He now insists he’s 100 percent recovered.
“I’m fine, I’m 100 percent healthy,” Jerebko told Vincent Goodwill of the Detroit Free Press. “Everywhere I go, that’s what people ask me. But I’m fine. I’m just ready for the season to start.”
The twenty four year old forward is anxious to get back to action; NBA action that is.
“My place is here in the States,” Jerebko said.
Jerebko played in Sweden and Italy professional leagues before being drafted into the NBA
“I’ve been through that phase of my life,” Jerebko responded when asked about playing overseas ball. “If other guys want to do that, that’s cool. I miss playing, I miss being out there with the guys. “I came into last year ready to make a jump, ready to be a leader.”Hopefully the lockout gets settled in the next month or so, but if not, maybe I’ll entertain playing elsewhere.