Utah Jazz guard Donovan Mitchell (45) takes a moment with head coach Quin Snyder during the fourth quarter against the Portland Trail Blazers in an NBA basketball game Thursday, Dec. 26, 2019, in Salt Lake City. (AP Photo/Jeff Swinger)
Recently, NBA star RJ Barret is in the news and with him a term, poison pill provision.
The poison pill is an NBA restriction which is used when the contract values are mismatched.
When a team extends a player’s rookie scale deal but tries to trade that player before the extension takes effect, it is referred to as a “poison pill” situation in terms of NBA contracts.
Although the phrase “poison pill” does not appear in the Collective Bargaining Agreement (CBA) of the NBA, it is frequently used to describe a clause that applies to players who have recently signed rookie-level contract extensions.
The average of the player’s current-year pay plus the wages for each year of his new extension is used as a poison pill to calculate the player’s incoming value for the receiving team for matching reasons. The current team of the player uses his current-year pay as the outgoing amount.
When Woj reported that Barret is signing a four-year deal with the NY Knicks worth USD 120 million, he also added that this whole process made it difficult for the Knicks to land Utah Jazz star Donovan Mitchell this offseason.
Barrett’s rookie contract will expire after the 2022–23 season. In the upcoming season, he’ll earn around $10.9 million regardless of whether he is traded or stays with the Knicks. The “poison pill” has absolutely no effect on his overall actual salary.
Due to the significant wage difference between the final year of a rookie contract and the first year of the contract extension, the situation is complicated in the poison pill case.
There have been 179 players in NBA history who have had the poison pill limitation, as per Wojnarowski’s Twitter. Only one out of those has been traded and that was Devin Harris in 2008.
There are 11 players who are affected by the poison pill in 2021 and are currently signed under the poison pill in the NBA.
The names of eleven players are Luka Doncic, Trae Young, Shai, Michael Porter Jr., Mikal Bridges, Jaren Jackson Jr., Kevin Huerter, Robert Williams, Wendell Carter Jr., Landry Shamet, and Grayson Allen. The same rule will not apply once the season commences.