NBA, NBPA Seeking To Adjust Extension Rules In New CBA Proposal

For years, NBA teams and players have had a shared problem. Extension rules on non-rookie deals were limited to 120% of the player’s earnings in the last year of his contract.

The issue has fostered trade considerations for numerous players, including Raptors forward OG Anunoby, since Toronto would be incapable of extending Anunoby under such limitations, and thus essentially be forced to let him test unrestricted free agency where he can leave outright. In that scenario, the Raptors would be left empty-handed.

According to Shams Charania from The Athletic, however, current CBA negotiations have had extension rules as one of their main topics, with the league and player’s union, NBPA, seemingly agreeing to up the allowed extension percentage from 120% to between 140-150%.

On the surface, that may not seem like a significant increase, and it’s fair to speculate whether a potential 150% increase is enough for players who sign below-market contracts, and who turn into clear-cut max players in the process.

So let’s see how it affects the future of Anunoby, who is projected somewhere higher than where his current compensation is, but below the max.

Anunoby will be earning $19,928,571 in the final year of his contract, a current extension number, based off the 120% rule, would start his new contract at $23,914,285.

As Anunoby is likely to receive a salary starting at $30 million or more on his next contract, there would be no reason for him to accept such terms.

Dialing that percentage up 150%, and a new extension would start him at $29,892,571.

That number is significantly higher than the currently allowed 120% raise, but could still fall short of what he would be offered in free agency. Especially considering that Anunoby would be a free agent in the summer of 2025, the year where the league’s salary cap is set to increase.

(While the NBA has yet to sign the TV deal that goes into effect that season, they’re expected to sign for up to $75 billion, and even with cap smoothing – to avoid a 2016 bump – the cap would still increase by a fair chunk.)

A 150% rule would fix many below-market contracts, but it won’t help those who have taken a significant leap in production after signing their initial rookie extension, such as Anunoby or Jaren Jackson Jr.

Jackson Jr even signed a deal that decreases over time, which is going to make it even more challenging for Memphis to retain his services.

The 6’11 big man will earn $23,413,395 in the 2025-2026 season, the final year of his contract. A 150% extension rule would allow Memphis to offer him a new deal starting at $35,120,093. That type of money would have been fine under the current salary cap, but in 2026 the cap has likely increased by over $30 million from where it is now, making Jackson Jr eligible for a much larger contract on the open market.

What’s curious about a 150% rule is how it doesn’t enhance the possibility of teams being able to retain their own elite players all that much, something the league has been vocal about for years.

Sure, a 150% rule does change the outlook on mid-tier contracts, and it allows players who haven’t broken out to get a more fair deal. It’s not a pointless percentage increase overall.

But for the likes of Jackson Jr and Anunoby, it doesn’t necessarily solve all that much. The Raptors would still find themselves in the exact same situation as before, knowing full-well that what they can offer Anunoby in extension talks fall short of the money available on the open market. As such, trade talks will have to be ongoing.

Of course, both Memphis and Toronto could still offer their players more money during actual free agency, but that defeats the purpose of extensions, and it would once again put those teams at a disadvantage if their players leave.

The idea of extensions is getting out ahead of the situation, and avoiding free agency altogether. But to do that, teams need to have the necessary ammunition to do so. The 120% rule is not that, and for the Raptors especially, neither is a 150% rule.

If the NBA and NBPA were to dial it up to 175%, then we’d look at a scenario wherein extensions became a much more potent tool. Technically, the wording would have to be something to the tune of “175% or the individual max-valued compensation” as the 175% rule would in some cases exceed the max contract allowance, which is disallowed.

Take Jackson Jr and Anunoby under a 175% rule. Their starting salaries on that type of extension would be $40,973,441 and $34,874,999, respectively. That’s suddenly much closer to what could be expected from offers on the open market.

And really, what’s the downside in making the allowed percentage even larger, or simply allowing – technically – outright maximum contract extensions regardless of the player’s compensation in the last year of his previous contract?

At the end of the day, extensions are about being able to retain players, something both the league and teams are interested in accomplishing as to create more sustainable products around the league.

So while a 150% rule is a good start, it seems the league still has some ways to go.

Unless noted otherwise, all stats via NBA.com, PBPStats, Cleaning the Glass or Basketball-Reference. All salary information via Spotrac. All odds courtesy of FanDuel Sportsbook.