The 2014 NBA Draft is almost a month away with the draft order set following Tuesday's draft lottery. The Cleveland Cavaliers were awarded the first overall pick for the third time in four years.
On June 26, 30 prospects will instantly become millionaires. However, there are limits to what star college and foreign players making the leap to the NBA can earn.
First-round draft picks are given salaries in accordance with the NBA rookie wage scale. These players have very little room to negotiate their deals. The first 30 players drafted are all guaranteed two-year guaranteed contracts. NBA teams can exercise a third-year and fourth-year option, if they decide not to guarantee the last two years.
The rookie scale for the 2014-2015 season has the No.1 overall pick making $4,592,200 in his first season, followed by $4,798,900 and $5,005,500 in the next two years. The salaries of each player steadily declines, as the draft moves along. The last six picks in the first round are all estimated to make less than $1 million in their first NBA season.
There is a lot of money to be made for a rookie that expects to go near the top of the draft. However, there isn’t as much of a difference, once the middle of the first round arrives. The scale has the No.2 pick making $4,108,800 in year No.1, compared to $3,012,500 for the fifth pick and $2,103,500 for the ninth selection. Picks 10-24 are all estimated to make more $1 million but less than $2 million in their first season.
There is some wiggle room for rookies to make more or less than what the scale dictates. A first-round pick can sign a contract that pays him up to 120 percent or as low as 80 percent of the scale. Last year’s top overall selection, Anthony Bennett, made 120 percent of the scale. If the Cavaliers take the same approach for a second straight year, their No.1 pick will make over $5.5 million as a rookie.
As the average NBA salary increases, so does the value of rookie contracts. In the 2005-2006 season, Andrew Bogut was drafted first overall by the Milwaukee Bucks. He made $3,617,100 in his first year, at a time when the minimum NBA salary was $398,762. Next season, no NBA player will make less than $507,336.
There’s a significant difference between being drafted 30th and 31st overall. While first-round picks get guaranteed contracts, teams are not obligated to give second-rounders a guaranteed deal.
The rookie scale wasn’t created until the 1995 NBA Draft, when the Golden State Warriors signed No.1 pick Joe Smith to a three-year contract worth $8.53 million. The previous year, the Milwaukee Bucks committed $68 million over 10 years to top selection Glenn Robinson.