The NBA and the player’s union have agreed on a new collective bargaining agreement.
Free agency will now begin on November 20 and allowing teams to sign free agents starting on November 22.
Beyond agreeing to those proposed dates on Monday night, the NBA and National Basketball Players Association agreed that salary reductions would be spread across this upcoming season and potentially the following two years to account for the $1.5 billion the league lost in 2020 due to the coronavirus pandemic.
The maximum salary reduction in any season will be at 20%. The $1.5 billion reduction in revenue stems from losses in gate revenue ($800 million), sponsorships ($400 million), and the fallout with China after former Houston Rockets general manager Daryl Morey tweeted support for the Hong Kong protestors during the preseason ($200 million).
Because of the depleted revenue, the NBA finalized the 2020-21 season’s salary cap at $109.140 million and the luxury tax threshold at $132.627 million. The NBA added in a statement that both the salary cap and tax level would increase in subsequent seasons by at least 3% and at most 10% from the previous seasons. It added that teams’ tax payments would be reduced in proportion to any decrease in basketball-related income (BRI).