Minimum Team Salary Violation: What's the Penalty

[Curmudgeon]

So the new minimum team salary is 90% of the cap, which for next year is a shade over $52M. Suppose a team's payroll is below that, say $45M? What's the penalty? If the penalty equals the difference between the team's actual salary and the required minimum, when does the offending team have to pay? And who gets the money?

[answerthink]

If a team’s Team Salary (including amnesty payments and payments to long-term injured players whose salaries have been removed) as of the start of its last regular season game is less than the minimum team salary, the NBA will require the team to make payments equal to the amount of the shortfall to the players on the team – to be disbursed pro rata or in a method as determined by the Players Association. The Players Association must provide its proposed distribution to the NBA within 30 days after the completion of the audit report for the salary cap year. The team then needs to make payment within 10 business days after that.

[Curmudgeon]

What does pro rata mean in this context? If there are 12 players on the roster, does each get 1/12th? Or is it pro rata based on relative salaries, so that the more highly compensated players get a larger share of the distribution? What about players who were only with the team part of the year, players who were traded away, or those on 10-day contracts?

[answerthink]

Pro rata means in proportion to the salaries of players on the team. However, there is no standard distribution. Because of issues such as those that you are bringing up, any time a team has not met its minimum team salary requirement, the Players Association is required to provide a proposed distribution.

[DBoys]

What's the penalty?

Essentially there's not a penalty to motivate a team to pay more than the minimum if they don't want to. If you end up below it, your players get the difference, but you end up paying only the minimum and not a penny more.

[HartfordWhalers]

Pro rata means in proportion to the salaries of players on the team. However, there is no standard distribution. Because of issues such as those that you are bringing up, any time a team has not met its minimum team salary requirement, the Players Association is required to provide a proposed distribution.

Am I correct in remembering that Sac stayed above it, Davis counted for Cleveland post amnesty, and thus no team has ever officially been below it?

It looks like we definitely might have a team below it this year, so will be interesting to see what distribution is proposed/accepted.