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Why Is NBA Labor Deal Closer? Players Get Last Check On Monday

Thursday, 27 Oct 2011 | 12:32 PM ET
NBA Lockout
NBA Lockout

After a marathon bargaining session yesterdaythat ended in the wee morning hours, NBA commissioner David Stern and union president Derek Fisher emerged with a cautiously optimistic outlook.

One of the reasons why is because the players get their last check on Monday and, suffice it to say, there's quite a few that need those checks to arrive in the near future.

Let's give a little lesson in how NBA paychecks work.

For the purpose of this example, let's take the average NBA player who makes $5.7 million. There are 24 paychecks spread out throughout the course of the year. That means a player would get $237,500 per paycheck. But that's not how it works. The league takes eight percent of the total value the player's salary and holds it in escrow, in case the owners wind up paying more than the last agreed deal of 57 percent of Basketball Related Income. If that happens, the 8 percent is kept, if it doesn't, some or the entire money comes back to the players in a lump sum check.

The entire escrow is only taken out of the checks earned during the season. So eight percent of $5.7 million is $456,000. That $456,000 comes out of the 12 paychecks the player will receive during the regular season. That means a player actually gets paid more during the offseason than during the season. So the average NBA player (making $5.7 million) got paid $2,394,000 during this past season and $2,850,000 in the offseason, the last of his $237,500 check coming on Monday. Now, because the owners failed to reach the 57 percent of Basketball Related Income this year, the players got a lump sum return of their eight percent escrow taken out of their bi-weekly salaries. So the average player received that $456,000 escrow payment taken out of his first 12 paychecks within the last two months.

Adding that all together, the average player, who made $5.7 million made nearly $1 million more in the offseason than he did during the regular season. During the regular season, he got paid $2,394,000. During the offseason? $3,306,000

The hurt hasn't come yet. But the players know it's coming soon if a deal isn't done.

Questions? Comments? SportsBiz@cnbc.com

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