Compensation is the all-encompassing term for all money earned by a Player throughout the entire Contract. Compensation is then split into different subcategories, which has rules and limitations defined by the CBA.
Compensation – Definition
Any compensation that is or could be earned or paid to a Player (including those whose contracts have been terminated).
Compensation Types
Generally
Below are the different types of Compensation (click to see rules applicable to each type):
Compensation Types and the CBA
Determining the Compensation Type is important, as each has different sets of limitations and are applied to different rules throughout the CBA.
🏀 For example, Incentive Compensation can’t exceed 20% of Regular Salary. While Signing Bonuses can’t exceed 15% of Compensation, excluding Incentive Compensation.
Compensation Types – General Definitions
| Compensation Type | Definition |
|---|---|
| Base Compensation | Base Compensation is Compensation other than any bonuses of any kind. |
| Regular Salary | Regular Salary is Compensation earned by the Player for a year less Signing Bonuses and Incentive Compensation. |
| Salary | Salary is all Compensation earned by the Player for a year other than Unlikely Bonuses and subject to certain adjustments. |
| Incentive Compensation |
Incentive Compensation encompasses three types of incentives:
|
| Signing Bonus |
Signing Bonuses encompass three types of bonuses:
|
✍️ Some Compensation Types, or portions thereof, are contained within others. For example, Salary includes all Compensation except Unlikely Bonuses, which is one type of Incentive Compensation. While Regular Salary excludes all Incentive Compensation and Signing Bonuses.