The Process
Three pages in this Guide discuss a Player’s entry into the NBA:
- Eligibility – Discusses when/how a Player is eligible for the NBA, at which point he enters into the Draft Process in the year he is eligible.
- The Draft – Discusses what happens when a Player is drafted (or is undrafted), how his Draft Rights are attached, and how the Team retains his Draft Rights until he signs a Contract.
- Draft Pick Signings – This page discusses what types of Contracts a Draft Pick (or Undrafted Player) signs based on where they were drafted (or undrafted).
First Round Picks
Rookie Scale Contracts
If a Player is a First Round Pick, then the Player must sign a Rookie Scale Contract.
Term Length
Every Rookie Scale Contract is a 4-Year Contract with Years 1 and 2 guaranteed and two Team Options for Years 3 and 4 called Rookie Scale Team Options.
The Rookie Scale Team Option has to be exercised by October 31st the Season prior to the applicable Year.
If both Rookie Scale Team Options are exercised, the Player is an RFA entering the offseason of his 5th Season (unless he signs a Rookie Scale Extension prior to his 4th Regular Season).
If either Option is not exercised, he becomes a UFA. His Prior Team can still sign him over the Salary Cap. His starting Salary is limited to the Rookie Scale Team Option that was declined.
Salary
The “Rookie Scale Amount”
The Player’s Salary must be within a fixed range based upon where the Player was selected in the Draft (hence the term “Rookie Scale”). This is called the Player’s applicable Rookie Scale Amount.
You can find the Rookie Scale Salaries here.
Signing a Rookie Scale Contract is a Salary Cap Exception, allowing Teams to sign their First Round Picks over the Salary Cap.
The Player is to earn a minimum of 80% Base Compensation of the Rookie Scale Amount, and can negotiate Salary and Unlikely Bonuses up to 120%.
It is common practice for Teams to pay the Player the 120% unless there is a specific reason for doing otherwise.
In 2024, the Knicks signed Dadiet to his Rookie Scale Contract for only 80% Base Compensation in his first season. The reasoning came clear later that offseason when the Team traded for Karl Anthony-Towns and needed every dollar they could save to stay under the First Apron. Lessening Dadiet’s Salary saved the Knicks over $900,000.
The Rookie Scale
The Rookie Scale is a baseline amount set initially with the 2023-24 Season and increases in line with the Salary Cap each Season.
The Baseline Rookie Scale Amount is found in Exhibit B-1 of the CBA.
You can find the Rookie Scale Salaries here.
Events Changing Rookie Scale Amount
Forfeiture of Draft Picks
If a Team is required to forfeit its Draft Pick, then the Salary Scale is adjusted for the applicable Draft to remove the 15th pick’s Rookie Scale Amount. If multiple Draft Picks are forfeited, then the 16th pick is removed, followed by the 14th, continuing in that order.
Prorating Salary if Signed During Season
If a Player does not sign his Rookie Scale Contract until January 10th, his Salary will be prorated beginning January 10th, and will be reduced on a prorated daily amount (Rookie Scale Salary ÷ Regular Season Days = Daily Amount to Reduce).
Trade Bonus
Similar to Maximum Salary, if a Trade Bonus is triggered by a Rookie Scale Contract causing the Salary/Unlikely Bonuses to exceed 120%, then it’s reduced down to 120%.
Signing During Regular Season // Non-NBA Contract
If a Player has a Non-NBA Contract, he can sign his Rookie Scale Contract from February 1st through June 30th to be effective beginning the following Season.
The Player is to receive the Rookie Scale Amount for the Season when the Contract begins. The Contract will state the percentage of the Salary Cap the Draft Pick is to receive, rather than a fixed amount.
Note that a Player can sign his Rookie Scale Contract while still under a non-NBA Contract, provided it expires prior to the effective date of the Rookie Scale Contract.
Later-Signed First Round Picks
The applicable Rookie Scale Amount is the season in which the Rookie Scale Contract takes effect, and not the Season the Player is Drafted.
However, if a First Round Pick does not sign a Contract in the first three Seasons following his Draft, then the Team with Draft Rights can sign him to either of the following:
- Rookie Scale Contract for the Season signed ; or
- Base Compensation greater than 120% of the Rookie Scale Amount provided the Team has Room, and the Contract is for a minimum of 3 Seasons (excluding Options).
In 2014, the Suns drafted Bogdan Bogdanovic with the 27th pick. After acquiring his Draft Rights in 2016, the Kings signed Bogdanovic in 2017. The Rookie Salary Amount for the 27th pick in 2017 was $1,186,300. However, the Kings used Cap Space to sign Bogdanovic to a starting Base Salary of $9,412,280.
Loss of Draft Rights
If a Team loses the Draft Rights to the First Round Pick, then the Player will become a Rookie Free Agent free to sign with any Team.
However, the Team with Draft Rights is prohibited from signing the Player until after he signed a Player Contract with another Team.
Additional Terms
Payments Arrangements
The following rules apply regarding Payment Arrangements and Rookie Scale Contracts:
- Signing Bonus – Not permitted (other than EIPPA);
- Loan – Not permitted;
- Payment Schedule – Can agree to a more favorable Payment Schedule.
Compensation Protection
Must provide for Compensation Protection for lack of skill/injury/illness of 80% of the Rookie Scale Amount in Years 1 and 2.
The Team and Player can negotiate any other conditions and limitations on Compensation Protection so long as Years 1 and 2 are protected.
Changing Terms Year-to-Year
The terms and conditions shall be unchanged from Year 3 and Year 4 other than Payment Schedule, and Salary/Bonuses shall increase by the applicable percentage in the Rookie Salary Scale.
Second Round Picks
Teams that draft a Player in the Second Round have the option (not a requirement) to sign him over the Salary Cap using the Second Round Pick Exception.
However, the Team is not restrained to the Exception and its terms, and can sign a Second Round Pick using any method of signing a Player, similar to a UFA.
In practice, Second Round picks will typically be offered terms within the Second Round Pick Exception, the Minimum Exception, or a Two-Way Contract. Two-Way Contracts are more common the later into the Second Round a Player is drafted
Undrafted Rookie
If a Player was eligibile for the Draft and went undrafted, he becomes a Rookie Free Agent.
A Rookie Free Agent can sign with any Team immediately upon the conclusion of the Draft. Oftentimes, Players will ask not to be drafted toward the end of the Second Round so they become Rookie Free Agents and can freely sign with their desired Team.
There is no separate Exception to sign a Rookie Free Agent. The Team must use Cap Space or another available Exception to sign the Player, unless signing him to a Two-Way Contract.
In 2025, Caleb Love went undrafted in the Draft. At the start of the Salary Cap Year, as a Rookie Free Agent, he signed a Two-Way Contract with the Trail Blazers.
Trade Restrictions
The Draft Rights to a Player can be included in a Trade immediately when the Player is drafted. However, a Player that was drafted cannot be included in a Trade for 30 days after signing his Contract.
This does not include undrafted Rookie Free Agents, who fall into the rules for signing as any other Free Agent signing, which is the later of three months or December 15th.
When executing a Trade, the exchanging of Draft Rights count at $0 both as Incoming and Outgoing Trade Salary. If a the Sending Team needs more Outgoing Trade Salary to execute a Trade (and the Receiving Team can absorb the Incoming Trade Salary), then signing the Draft Pick before the Trade can create this additional Trade Salary. However, if the Teams were trying to execute the Trade during the Draft, the 30-day trade restriction will force the Trade into the next Salary Cap Year, which may affect the other Players’ Trade Salaries.