The NBA has a lot of complicated rules and contracts in the NBA can be confusing when there are a lot of unknown terminologies.
How many Contracts can an NBA team have? An NBA team is permitted to have 17 players under contract during the season but can carry up to 20 players on their roster during the offseason.
During the NBA season, teams are allowed to have 17 players under contract. NBA rules state that teams are allowed to have 15 players under normal professional contracts. The NBA also allows teams to have two players on two-way contracts which allows them to play in the G League with the ability to also play in the NBA.
In the offseason, you can have a maximum of 20 players contracted to the team but of course, this needs to be cut down before the season starts. However, there are a few different types of players on rosters, with different contract situations all making up the roster size.
What types of NBA contracts make up a roster?
A two-way contract is one that allows players to split their time with the NBA team they signed to and the team’s G-league affiliate. This is usually one signed by players who would get very little playing time with their NBA team and so are shipped off to the G-league in order to get more playing time and develop.
Each team is allowed to offer two two-way contracts per season as long as the player has less than four years of experience in the NBA. The system is designed to benefit undrafted players who want to play in the NBA. Getting their foot in the door gives players better chances of earning a roster spot.
Often two-way contracts can lead to a full-time roster spot in the NBA. There have been a few successful players in the last few years to have originally joined the NBA on a two-way contract. These include guys like Duncan Robinson, Lu Dort and Alex Caruso. Most of the players impressed enough in the Summer League to earn a two-way contract.
Unsigned draft picks
A player will still count towards the roster size if they are an unsigned draft pick. When a team picks a player in the draft, they then need to agree on a contract with that player. This often takes a few months as the rookie contract scale is very beneficial to teams as players’ rookie contracts can be their lowest paying contracts.
During these negotiations, the player still counts towards the team’s roster size.
Restricted Free agents
It may seem strange that players who hit free agency can still count towards a team’s roster size. But this is the case if the player is a restricted free agent. This is because the original team still has the first right to sign the player.
Being a restricted free agent means you are free to talk to other teams to negotiate a new deal, like an unrestricted free agent. But being a restricted free agent means the team you were with the prior year have 48 hours to match any contract offer that you get from a new team.
If the original team decides to match a new offer, the player will return to the team they were with before free agency. So a restricted free agent is not really off the team until the team decides against matching an offer. As the team has first right to sign the player, they still count towards the roster size and the number of contracts a team can have.
The largest contributor to NBA rosters are official contracts and this type of contract is also known as a uniform player contract. These normal contracts make up the majority of roster spots and contribute heavily to how a team is formed.
What is the NBA over 38 rule?
The NBA over 38 rule means that a team that offers a four or five-year deal to a player over 35 years must pay the last year of the contract in the prior seasons so that the team cannot take advantage of a player retiring.
Essentially, the NBA used to have a problem where teams would offer an old player a multi-year contract even though they knew the player would likely retire in the next year or two. Teams did this so that they could stretch out a contract over more years and give the team more cap space.
The NBA wanted to cut down on teams using that loophole and so they introduced the Over 36 rule, which became the over 38 rule. It prevents teams from taking advantage of a loophole in the salary cap. It means teams have to pay the whole contract early, making stretching out a contract for an older player obsolete.
What is the biggest contract in NBA history?
In terms of the total value, Nikola Jokic signed the biggest contract in NBA history on July 1st 2022. It is a five-year contract that will keep Jokic with the Denver Nuggets until at least 2028 because the contract comes into effect in 2023. Across the course of the five-year deal, Jokic is earning an average of $53.998 million per year, which is not the highest average for an NBA contract.
While Jokic has the biggest NBA contract in terms of total value, there are two current NBA contracts that have a higher average earning per year for the players that signed them. Devin Booker and Karl-Anthony Towns both signed four-year extensions with the teams that drafted them.
Both of these contracts are four-year, $224.224 million deals which makes the average figure they are earning $56,056,000. These two are the only two players to earn more than Jokic per year.
The reason why these players can sign big contracts like this is that they stayed with the teams that drafted them. The NBA has incentivised staying with the team that drafted you by allowing that team to offer slightly more money than other teams. It is why the top five contracts in the NBA based on average earnings per year are between players and the team that drafted them.