What is a two way contract in the NBA?

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Know more about the two way contract that is present in the NBA

A two-way contract in the NBA as of late in the 2017-18 season and was a concept mostly common to ice-hockey players as of then. Usually playing in the minor or subsequent leagues may aspire to play for another league, maybe on a higher level. This is allowed through the concept of the two-way contract. Although it has become quite popular for the NBA in the last few seasons, the term may still come off as a little flaky or complicated to the fans, so let’s break this down and learn how this affects the National Basketball Association.

The NBA two way contract

An NBA team at one season can have a maximum of fifteen players on the roster out of which eight are active players. The two-way contract in the NBA, however, allows 2 more players – the sixteenth and the seventeenth to be added to the roster and be active players, for a maximum of 45 days in a season.

These sixteenth and seventeenth members are from the NBA G League which was also known as the NBA Development League until 2017. It is the official minor league for American Basketball, and amateur players who wish to play in the bigger league can experience the same with the introduction of the contract.

Alex Caruso
Alex Caruso is a good example of the use of the NBA two-way contract. (Image credit: Getty)

How are the players paid in the two way contract?

Not everyone can come under this contract. Players that have been a part of the NBA for 4 years and lesser can sign a two-way contract in which for the maximum part of the season they’d have to play for the NBA G League and a maximum of 45 days in the NBA. So, how are these players paid? Simply concerning the number of days they spend playing in both of these leagues. This means if a player actively plays 10 games for their NBA team, they’ll be paid accordingly and the rest will come from the number of days he spends playing in the G League.

A two-way contract player also gets quite the pay, and if he does end up playing the 45 days in the NBA, he can earn around 200K USD, while his average salary in the minor league is around 80K USD for the entire season.

NBA two way contract
The difference of pay scale in the contracts. (Credit: medium.com)

Terms of the two way contract

  • A player can only sign a two-way contract if they have four years and lesser years of experience in the NBA.
  • A player cannot sign the contracts for more than two seasons.
  • If the NBA team chooses to terminate the player’s active membership before the end of these 45 days, they are allowed to do so. And the player will have to be back in the G League.
  • The NBA team can also choose to permanently sign the G league player into their team’s roster.

Changes to the two way contract

The two way contract in NBA saw some changes to its terms in the current 2020-21 season where the limit on the 45 days was lifted completely. A fixed pay was also introduced for the two-way player which would be around $450 K, much better pay than before which was $280K.

However, these terms were introduced in the lieu of the ongoing COVID-19 pandemic and we aren’t sure as to if they are a permanent change.

In the 2021 season, except for the Toronto Raptors, almost every team has signed two two-way players. And only the Phoenix Suns, New York Pelicans, and the Minnesota Timberwolves have one player each. Since the two-way contract is a recent introduction in the NBA, it still has its share of shortcomings but overall it is an impressive and much-needed introduction nonetheless.

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