2. CBA Term of the Week
Two-Way Contracts:
In the latest version of the Collective Bargaining Agreement, teams have been granted two additional flexible roster spots which may be used to sign players to Two-Way contracts. This gives teams the ability to send young players down to their G-League team for the majority of the season without the threat of them being poached away by a competitor.
Two-Way contracts can only be for a maximum of two years in length and upon expiration, the player will become a restricted free agent. Contracts of this nature cannot contain any options, bonuses, incentives, deferred compensation, loans or advances. Two-Way contracts may include a portion of guaranteed salary but only up to the amount of $50,000.
The salaries of Two-Way players are pro-rated by day depending on whether they are assigned to their NBA club or their G-League affiliate. When such players are with their NBA team, they receive the NBA rookie minimum salary on a per-day basis, but may only spend a maximum of 45 days with the team over the course of a season. As the NBA season is 170 days long, this means they will receive a pro-rated portion of the Two-Way salary, which in 2017-18 is $77,250, for the 125 or more days they spend with the G-League affiliate.
In terms of eligibility, a player is deemed ineligible to sign a Two-Way contract if he will have more than three years of NBA service at any point in the contract. The purpose for having this criteria in place is to restrict clubs from using these contracts to sign players already established in the league, and thus encourage the development of young prospects through a team's system. Two-Way players are also ineligible from playing in playoff games or from being included on the team's playoff roster. However, they can be on the NBA team’s Inactive List during the playoffs, allowing them to can and practice with the NBA team.