You may remember that one of the few NBA salary rules changed in the 2016 collective bargaining agreement centered on the earning power of stars in their mid-30s. We dubbed this the Chris Paul Rule, because CP3 stood to benefit most immediately and he was the players’ union president when it was negotiated and adopted.
More accurately, we should call this facet of the agreement the Over-38 Rule. Essentially, it took some pre-existing salary cap deterrents for signing high-end players at least 32 years old to long-term contracts, and bumped that age threshold up a couple of years from 36 to 38. (Larry Coon’s invaluable CBA FAQ has a more detailed breakdown).
As it happened, CP3 was 32 when the revised rule went into effect in 2017, just in time to become a free agent that summer. Thanks to the revised rules that CP3 helped negotiate, he could have re-signed with the Clippers for a five-year deal worth $201 million. The upshot is that elder players, such as CP3, could earn an extra year, worth about $50 million more in total.
Not for nothing, Paul is known as a shrewd negotiator. Perhaps too shrewd, as things have turned out. And perhaps his interest in promoting the interests of himself and his fellow 30-something star friends overtook his role as the person leading negotiations on behalf of the entire 450-member players’ union.
Paul didn’t actually do the five-year deal with LA, but he still benefitted from the Over-38 Rule. CP3 told the Clippers he would opt out of his contract in 2017 and sign with the Rockets if they didn’t agree to trade him to Houston. The Clippers obliged for the price of Patrick Beverley, Lou Williams, and Montrezl Harrell, which was a beautiful package for Los Angeles in retrospect.
After a rousing 2018 playoff run that ended a CP3 hamstring injury away from a championship, the Rockets signed Paul to a four-year, $160 million deal. That deal was once again possible because of CP3’s Over-38 Rule. Without it, Paul would likely have signed a three-year, $115 million deal to get the max. The Over-38 Rule made Chris Paul an extra $45 million, equivalent to the salary he’ll earn as a 37-year-old in 2021-22.
On the one hand things worked out as intended. Paul got his money and the Rockets opened a spirited, albeit doomed, two-year window. The problem is that in taking all that money, Paul made himself more of a liability on the Rockets’ cap sheet.
Last week, the Rockets traded Paul and two first-round picks to the Thunder for Russell Westbrook. The former MVP lays claim to one of the riskiest contracts in basketball, comparable only to John Wall’s supermax deal. But Westbrook’s deal still represented a hugely positive value relative to Paul’s.
This is how onerous CP3’s contract is given the evident impact of age on his performance last season: the Rockets had to add multiple picks to get off of the contract while taking back the third most onerous contract in the league.
CP3 got paid. He got his guaranteed money, all of it, the entire bag. But now he’s stuck on a (seemingly) non-competitive Oklahoma City Thunder roster for the foreseeable future. The competitive outlook for one of the most competitive players of his generation looks grim.
Frankly, this is reminiscent of Carmelo Anthony’s slow descent into irrelevance. Eventually, Melo slipped so far he was salary-dumped to the Hawks and waived. He collected massive checks in 2018-19 as he fell completely out of the NBA by Thanksgiving. It was a sad end to an illustrious career.
Is that Paul’s fate? If so, was it worth the extra $45 million? Probably. It’s $45 million, for goodness sake. And there’s no guarantee the Rockets would have kept him were he on the three-year version of the max.
Is the fall of CP3’s value relative to his contract a perfect example of why the Over-36 Rule existed in the first place — to protect teams from making costly mistakes? Absolutely!
Would CP3 and the union push for the change all over again knowing what they know now? Absolutely! It’s all about allowing players to earn as much money as possible for as long as possible. That is basically CP3’s charge as president: get his members — including himself — paid.
But this is where it gets complicated. This is where we ask which members CP3 has been working for.
The $45 million going to Paul in 2021-22 to perhaps chill in Barbados, or maybe play out the string on a middling team, or as a bought-out ring chaser on a contender, is $45 million that isn’t going to mid-tier or young players.
Every effort made under Chris Paul’s union leadership to bolster the contracts of top-line players — the supermax contract and the Over-38 Rule especially — takes money right out of the pockets of the NBA’s middle class.
NBA salaries across the board are higher than ever. But the average NBA player could be getting an even bigger collective slice if recent bargaining tweaks hadn’t prioritized stars generally, and CP3 specifically.
We didn’t hear too much grumbling from those mid-tier players when news of the Over-38 Rule came out. As we watch the union president earn $40 million annual salaries deep into his 30s, we’ll see if that changes.