The 2011 NBA lockout was the fourth and most recent lockout in the history of the National Basketball Association (NBA). Team owners began the work stoppage upon expiration of the 2005 collective bargaining agreement (CBA). The 161-day lockout began on July 1, 2011, and ended on December 8, 2011. It delayed the start of the 2011–12 regular season from November to December, and it reduced the regular season from 82 to 66 games. The previous lockout in 1998–99 had shortened the season to 50 games. During the lockout, teams could not trade, sign, or contact players. Players additionally did not have access to NBA team facilities, trainers, or staff.
Negotiations between the owners, led by league commissioner David Stern, and the players, headed by director Billy Hunter and president Derek Fisher of the labor union National Basketball Players Association (NBPA), began in early 2011 and continued through November. The main issues dividing both sides were the division of revenue, the structure of the salary cap and luxury tax. Owners proposed to reduce the players' share of basketball related income (BRI) from 57% to 47%, but the players countered with 53% of BRI. Owners wanted to implement a hard salary cap and a harsher luxury tax, hoping to increase competition among teams, whereas players wanted to keep the current soft salary cap structure intact.
As both sides failed to reach an agreement, the NBA canceled the preseason and all games through December. On November 14, the players dissolved the union, allowing them to file antitrust lawsuits against the league. On November 26, both sides reached a tentative agreement to end the lockout. The new CBA calls for a revenue split of 49-to-51.2% and a flexible salary cap structure with harsher luxury tax. After the tentative deal was reached, owners allowed players to have voluntary workouts at team sites starting December 1. After the deal was ratified on December 8, training camps, trades, and free agency began the next day. During the lockout, some players signed contracts to play in other countries, mostly in Europe and Asia, with most of them having the option to return upon the lockout's conclusion. The lockout also affected the economy outside the league due largely to cities that had teams in the league losing revenue generated by games as well as television networks that broadcast the league losing ratings and advertisement revenue due to games not being played.
Chronology
- July 1, 2011: The lockout begins.
- September 23, 2011: The NBA canceled training camp, which was to begin October 3, and the first week of preseason games, which were to run October 9 through 15.
- October 4, 2011: The NBA canceled the remainder of the preseason.
- October 10, 2011: The first two weeks of the regular season canceled.
- October 18, 2011: All games through November 30 canceled.
- November 14, 2011: The NBPA dissolves labor union into a trade association.
- November 15, 2011: The NBA canceled all games through December 15. Players filed antitrust lawsuits against the NBA in Chicago and New Mexico federal courts.
- November 26, 2011: The NBA owners and players reached a tentative agreement to end the lockout.
- December 1, 2011: The NBPA re-formed as a union.
- December 8, 2011: The new CBA is ratified, officially ending the lockout.
- December 25, 2011: NBA season begins.
Background
After the previous lockout, which shortened the 1998–99 season from 82 to 50 games, a six-year deal between the owners, led by commissioner David Stern, and the players, led by director Billy Hunter and president Patrick Ewing of the labor union National Basketball Players Association (NBPA), was reached. As the CBA was set to expire on June 30, 2005, the two sides began to negotiate in early 2005. There were several issues obstructing the new agreement, which included adding an age limit for rookies, toughening the existing drug-testing program and limiting the length of long-term contracts. However, negotiations went smoothly and the two sides were able to reach a deal in June 2005, avoiding the lockout. That deal guaranteed players 57% of basketball-related income (BRI) and lasted for six years, until June 30, 2011. A year after signing the deal, eight owners signed a petition requesting Stern address the disparity between small-market and large-market teams. They wrote that "the hard truth is that our current economic system works only for larger-market teams and a few teams that have extraordinary success ...The rest of us are looking at significant and unacceptable annual financial losses."
Derek Fisher succeeded Ewing as NBPA president in 2006. In early 2011, negotiations on a new CBA began. The league claimed that it was losing $300 million a year (22 out of 30 teams were losing money last season) and proposed to reduce 40% of players' salary (about $800 million) and institute a hard salary cap (at $45 million per team) as opposed to a soft cap (at $58 million) currently in use. The union disputed those figures and steadfastly opposed those changes. Hunter said that he was advising players to prepare for a lockout. In May 2011, the NBPA filed a complaint with the National Labor Relations Board (NLRB), accusing the league of negotiating in bad faith by failing to provide critical financial data to the union and repeatedly threatening to lock out players. The NBA quickly rejected the complaint, saying that the league complies fully with federal labor laws. The union also considered the option of decertification, which allows players to file an antitrust lawsuit against the NBA.
With time winding down, negotiations continued in May and June. On the salary cap, the owners, in their newest proposal, call for a system called the "flex cap" that limits payroll at $62 million but penalizes teams if the teams payroll exceeds the league's average payroll of that season. The union argued that it is still a hard cap because the ceiling would kick in eventually. On salary reduction, players offered to cut $500 million over the next five years (their share of BRI would be reduced from 57 to 54.3 percent). The owners instead proposed to cut $2 billion over the next 10 years.
As a last-ditch effort to avert a lockout, owners and players met again on June 30, 2011, to negotiate, but both sides failed to reach a resolution on key issues like salary cap and BRI splits. Both Stern and Hunter said that the two sides remained far apart. The owners demanded a larger share, claiming that they were losing money. The players, on the other hand, were willing to make concessions, but they refused to completely cave in to owners' demands. Negotiations broke off, and the CBA expired at midnight.
Lockout
Initial months
The lockout was officially started by the owners on July 1, 2011, during which teams could not trade, sign, or contact players, and players could not access NBA team facilities, trainers, or staffs. Negotiations resumed at an August 1 bargaining session, but it fell apart after three hours. On August 2, 2011, the NBA filed two unfair labor practice claims against the NBPA, one at the NLRB and another at a federal district court in New York. The league accused the players of being uncooperative in negotiations by threatening to dissolve their union and file antitrust lawsuits. Hunter, in a statement released by the union, called the lawsuits "without merit" and that the union would seek to dismiss it in court. On August 4, Hunter said that he thought the entire 2011–12 season would likely be canceled.
The NBPA and the owners returned to negotiate again on August 31 with a sense of urgency. No specifics were disclosed although both sides hoped to meet again soon. "Everyone loses if we don't reach an agreement, that's something that I think has always been understood," said union president Derek Fisher. "I will say we are not apart in terms of an agreed urgency on getting a deal done," said NBA deputy commissioner Adam Silver.
The union and owners met again on September 13 but the negotiation soon collapsed. The salary cap structure remained the main source of disagreement. Owners wanted to create a hard cap for team payroll. The union wanted to keep the current structure intact, referring to it as a "blood issue". Players were willing to cut salary only if owners agree to compromise on the salary cap. But owners were unwilling to concede, saying that there must be a system in place that allows all teams to compete. Five of the sports agents—Arn Tellem, Bill Duffy, Mark Bartelstein, Jeff Schwartz, and Dan Fegan—who represent one-third of NBA players spoke with each other about decertifying the union. They believed owners have most of the leverage in negotiation and viewed decertification as a way for players to take control. Hunter said however that players had not considered decertification at this point.
On September 15, Fisher sent an email to 400-plus players asking for unity. In the email, he said that recent meetings were "effective". He suggested that the failure of having a deal was not due to disagreement between players and owners, but due to disagreement among owners. Fisher also used the opportunity to counter agents' suggestion of disbanding the union, saying that they were not making "a drastic move that leaves players without a union". According to sources, there was indeed disagreement among the owners. Some thought players' proposal of taking 52% of BRI was fair, and were willing to compromise on things like tying players' future earnings to NBA's future revenue growth and maintaining current salary level. Cavaliers' Dan Gilbert and Suns' Robert Sarver were among the hardliners who oppose the deal while Knicks' James Dolan and the Lakers' Jerry Buss were among the group in favor of it. Stern denied that there was a rift among owners the following day, saying, "I don't know what the basis of Derek's belief is."
Cancellations
On September 23, 2011, the NBA canceled training camp, which was to begin October 3, and the first week of preseason games, which were to run October 9 through 15. The incident marked only the second time in league history that games had been lost to a labor stoppage. Both the owners and the union had planned to meet on September 30 in New York and pledged to continue through the weekends if progress was being made. A source close to the situation leaked to ESPN that Stern planned to threaten the cancellation of the season if no deal was made, but the union saw this as a scare tactic and not a serious threat. Commentators speculated that Stern wanted to put pressure on the players and prevent negotiation from dragging through the fall. The meeting on September 30 was tense as Dwyane Wade reportedly yelled at Stern after he pointed his finger at Wade. The players nearly stormed out, but they remained in the meeting only after Hunter asked them to. Stern also backed down from his earlier threat that he would cancel the season if there was no deal.
On October 4, the NBA canceled the remainder of the preseason. Stern said the league would lose $200 million by canceling the preseason, and warned that the first two weeks of the season would be in jeopardy if no deal was reached by October 10. The players proposed that they receive 53% of BRI, while the owners countered with 47%. The two sides then discussed a 50–50 split of BRI, with the owners offering the players 49% of BRI with incentives that would raise the value to 51%. The players countered by asking for 51%, which would increase to 53 percent using those same incentives. It was rejected by the owners. Attempts for the sides to meet on October 7 failed. The union said the NBA demanded a 50–50 revenue split prior to the meeting, while the league refuted making any such demands. After talks on October 9 and 10, the two sides were unable to reach a deal and Stern subsequently canceled the first two weeks of regular-season games, which were originally scheduled to begin on November 1. BRI remained the main issue, but other differences included luxury tax, player contract length, and the mid-level exception. The owners proposed a $2 tax for every $1 that a team spent above the tax threshold for player salaries. The tax would rise to as high as $4 for every $1 above the limit for teams that were repeat offenders. The previous CBA in comparison called for a $1 tax for every $1 over the limit. The players refused to accept a hard salary cap, which they felt the more punitive luxury taxes would effectively create. Stern said the owners felt a harsher luxury tax would make the league more competitive. Wade countered that a small-market team like the San Antonio Spurs had won multiple championships. Andrew Zimbalist, an economist at Smith College, said that "the statistical correlation between payroll and win percentage is practically nonexistent" in the NBA. ESPN concluded that a team's draft efficiency accounted for 34% of its winning percentage in the past decade, while payroll showed only a 7% correlation. The New York Times noted that a fairer system was needed for the small-market teams, but the league's popularity historically relied on predictably successful teams with multiple superstars.
NBPA leaders met with around 30 players on October 14 and stressed unity. Washington Wizards player JaVale McGee left the meeting early and told reporters there were some players "saying that they're ready to fold", but the majority was united. McGee later denied mentioning that players were ready to fold, but his comment was recorded by reporters. Fisher said McGee had "no ability to make that statement" based on the limited time he spent at the meeting.