Former NBA Deputy Commissioner Russ Granik Sees Little Hope in Labor Situation

BOSTON – Talk about a miscommunication.

I said hello to former NBA deputy commissioner Russ Granik at the MIT Sloan Sports Analytics Conference on Friday, then asked him to share his unique perspective on the looming labor situation. He said he was encouraged and optimistic…about the NFL.

Once it was clarified that hoops was the sport in question, his tone certainly changed. Only this type of event could offer this sort of opportunity to bend this kind of ear, and the man who spent 30 years in the league and 22 as second-in-command to commissioner David Stern before his 2006 exit was as interesting as I’d hoped in assessing the situation.

To review, the NBA’s collective bargaining agreement expires on June 30 and a lockout is expected thereafter. The players submitted their proposal to the owners at All-Star weekend 2010 in Dallas, and the owners never responded with a counter-offer of any kind. At All-Star weekend in Los Angeles last month, a positive tone was set at a meeting that almost didn’t happen but it still appears no progress has been made.

The owners remain highly-motivated to couple a hard salary cap with extreme salary rollbacks in implementing the kind of system overhaul that will be at the root of an eventual lockout. The players, quite predictably, aren’t too fond of Stern’s intent to cut salaries by a third. Still, it’s nothing Granik hasn’t seen before.

He was the league’s chief negotiator in the past four times a deal needed to get done, among them the 1998-99 season in which the games didn’t begin until January because of a lockout. He knows the characters involved, from Stern to most of the owners themselves to Players Association executive director Billy Hunter. He knows the issues yet no longer gets paid to solve them, which means he was able and willing to discuss them at length with NBA Confidential.

Granik, who is now the vice chairman of Galatioto Sports Partners, was a speaker for the panel dubbed “The Coming War: Sports Labor Relations.” And unfortunately for NBA fans, it continues to look as if a long labor battle will ensue.

NBA Confidential: So you said you were encouraged by the NFL’s prognosis, but how do you see the NBA labor situation and where it‘s heading?

Granik: “I think the NBA has a more difficult problem (than the NFL), because it’s harder to see where there’s an easy compromise. On a relative basis, they’re looking for greater moves by the players and I think it’s going to be more difficult. They’ve got a lot of smart people on both sides, so hopefully they’ll come to a good conclusion.”

NBA Confidential: Did you see it as progress that the players said they were willing to discuss any and all issues at All-Star weekend, including a hard cap?

Granik: “I haven’t seen that the players said that. I always felt that in bargaining you tend not to make progress in increments, even though that’s what people are always writing is, ‘Well, they didn’t make any progress.’ Well, you don’t really know that.

“Nobody really gives up anything important until it’s all done. It’s always got to all be part of a package, because nobody wants to give something unless they know where they’re going. So if you’re not in the room, and even if you are sometimes, it’s hard to know where you are. But it doesn’t take a lot of time to make a deal. And so when the parties are ready, they’ll get the deal done.”

NBA Confidential: One of the issues the NBPA is focused on is revenue sharing and whether it gets negotiated as part of the CBA or on the side by the owners and the league. The players would like to have some say in that key component. Is that a fair request?

Granik: “I don’t really think it should matter to the players (if revenue sharing is negotiated in the CBA) if you have a salary cap. I understood what (fellow panelist and Smith College economics professor) Andy Zimbalist was saying about baseball, that because there’s no salary cap situation it’s very relevant to the players as to how the revenues are being distributed because they want all the teams to at least get to a certain level.

“But in the leagues that have salary caps, there’s already a minimum team salary, so whatever happens the players get 57 percent (of basketball-related income). At the end of the day, players get 57 percent. That’s how it works. And so, revenue sharing is not going to change that. It might affect who gets it, but it’s not going to affect what the players get. So I think there ought to be less concern when you’ve got a salary cap system on the part of the players about how the owners share revenue. You know you’re going to get your cut. Baseball is different.”

NBA Confidential: There has been some planning for possible decertification of the players union (read here to learn more). Do you see that as a real possibility?

Granik: “I think there’s just a lot of litigation that could be done over that. I think the biggest concern I would have on both sides is once you’re down that road, it just distracts from the more important issue of making the deal, because the litigation is going to take longer than it’s going to take to get a deal in any event.

“I understand it can affect leverage back and forth over time, but the reality is that when you’re in that, there’s going to be some period of weeks or months where the focus won’t be anymore on making a deal and that’s unfortunate. But the players have to do what they think is the best strategy and the owners will do the same.”

NBA Confidential: Do you think Billy’s personal story comes into play at all here? There are some people who feel like this is probably his last negotiations and that he’ll be even more stubborn than usual to not get run over by the owners in his last stand.

Granik: Well people said last time it was David’s last negotiations, so who knows? Billy’s not that old (he’s 68). I think Billy is a very practical leader. I don’t think the personal issue will play a big role for him. I think he’s going to do what he feels he should do for his clients and what his clients want him to do. That’s got to be the prime motivation as far as I’m concerned.

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6 responses to “Former NBA Deputy Commissioner Russ Granik Sees Little Hope in Labor Situation

  1. Laurie Edwards

    I wonder if the NBA will survive an extended lockout. Remember the NHL strike/lockout a few years back? That league has yet to fully recoup from the loss of fan interest and attendance. With the drop in NBA fans and revenue, you’d think both sides would be eager to come to an agreement, but that doesn’t seem to be the case. This lockout is going to damage the league, perhaps beyond repair.

  2. I thought what RG said in the first 2 paragraphs was the major gist of the article: Until both sides feel really ready to make a deal, there won’t be one. It will be completely posturing up until that point.

    I’ve heard your opinion many times on this particular issue (in one way or the other) Sam, but I can’t imagine the owners and/or players just let a lockout happen. It might go through August or September, but by training camps both sides will see the benefit of getting back to work. Once there is enough time to set everything up, everyone will be back to the task at hand that really makes the CBA negotiations smaller than they should be: Winning games.

    At any rate, my bet is that Peter Holt for the owners and I’m not sure who for the players (there could be a number of guys I think who could end up in this wave) and I’m going to say Derek Fisher (for lack of a better player to name) can hammer this thing out by themselves. Both have enough perspective and reason to not let a prolonged lockout happen again like ’99. Both lived through it, and both will be around for the 11-12 season.

    Although, to be honest, if the Kings leave Sacramento, I could care less if the CBA gets settled.

  3. Pingback: Former Stern right hand man not optimistic about CBA negotiations | ProBasketballTalk

  4. Russell Besser

    I think Granik either still has loyalties to David Stern or doesn’t want to open up the can of worms that is the need for the NBA to set up an equitable revenue-sharing system. The players have identified the need, as nearly all of the marquee free agents in recent years have only considered teams in Texas, Florida or the major media markets of New York, Chicago and LA. In fact, those NBA teams have won 18 of the last 20 NBA championships (Boston & Detroit being the lone exceptions). There is nothing David Stern can do about making the weather warmer in Minnesota or Cleveland a bigger media market like New York, but he can and should do something to level the playing field for teams that can’t compete with the tax advantages players receive in Texas & Florida versus Toronto & Milwaukee or the premium sponsors will pay athletes on teams in major markets.

  5. The NBA is very different than the NFL so I’m not sure if revenue sharing will really turn out to be as important as Stern and the owners think. The NBA really flourished during the years where Jordan, Magic, and Bird dominated – having more parity or a level playing field is not necessarily going to solve their problems. It’s a star-driven league.

    I agree with the league that they need to limit the guaranteed years of contracts though, every player should eventually concede that point since the better players will get more of the pot, not guys like Travis Outlaw or Rashard Lewis. The sad thing is the owners need to be protected from themselves, and the league probably knows this.

    But I’m with @pookeyguru: if the Kings leave Sacramento, I’m going to force myself to follow the NHL, soccer, or dare I say it, read books.

  6. I personally hope that the league does get some pressure in terms of fixing the NBA and making it better for the entire organization, from the players to the fans and lastly, to the owners. The bottom line is, the owners are putting a lot of their money on the line, but the players are putting their bodies and life on the line too. And the fans put their hearts on their sleeve for their teams and they pay the way for everything else to happen…

    If there is enough pressure, maybe some of these things can actually be improved and we can get down to some good basketball! And maybe the Kings won’t move, and we can enjoy a great new season with the Sacramento Kings!