BOON OR BANE? : THE NBA’S ‘ONE AND DONE’ RULE

Written by Nirih Kamplimath

Introduction

In the world of professional basketball, the NBA's "one and done" rule has been a topic of debate and scrutiny. The rule, which prohibits athletes from signing with the NBA till they are nineteen years old or one year removed from high school, has drawn criticism for its impact on competition in the league. The reason this rule has garnered major media attention in recent times is the speculation regarding the  phasing out of this very rule when the league's present Collective Bargaining Agreement (hereafter referred to as CBA) with the National Basketball Players Association (hereafter referred to as NBPA) comes to an end. The rule derives its nomenclature of 'one and done' from the common practice of college basketball players spending just one year in college before declaring for the NBA draft.

While this rule, prima facie, seems like a fair one from the perspective of player development and the NCAA's desire to ensure viable academic opportunities for student-athletes (by necessitating one year in college), it has raised concerns about the undue advantage the NBA and by extension the NCAA gain from this arrangement. The implementation of the "one and done" rule in the NBA has significantly impacted competition in the league. However whether this impact is favorable or not, is a question which has sparked great debate. This article seeks to answer this question by first delving into the history and evolution of this ‘One and Done’ Rule, and then subsequently analyzing the pros and cons of the same. Finally the last part of the article would answer the question of whether the ‘One and Done’ Rule should be eliminated.

The History and Evolution of the ‘One and Done Rule’

The NBA has had a string of lawsuits pertaining to the minimum eligibility requirements to sign with the NBA, more specifically about the age of the ‘freshman’ class of athletes applying for the draft. In the 1960’s the NBA’s regulations pertaining to eligibility requirements were much higher than the present one and done era. As the trend of collegiate basketball dominated the time, players had to compulsorily wait four years after high school, to be eligible to apply for the NBA draft. However, this was fundamentally altered by a landmark case decided by the US Supreme Court in Haywood v. National Basketball Ass’n. Spencer Haywood, the reigning Rookie of the Year, and a talented twenty-year-old, had signed with the American Basketball Association's (ABA) Denver Rockets after only two seasons in college, and later agreed to a contract with the NBA's Seattle SuperSonics, despite not yet being four years removed from high school.

Haywood alleged antitrust violations by the NBA, specifically an unlawful group boycott, citing two Supreme Court decisions, Fashion Originators' Guild v. FTC and Klor's v. Broadway-Hale Stores, which found a per se violation of the Sherman Antitrust Act. The legal battle resulted in the U.S. Supreme Court's decision in favor of Haywood, granting an injunction to allow him to play for the Seattle SuperSonics pending antitrust litigation. This decision paved the way for a generation of athletes to enter the NBA "from prep to pro," as for the thirty-four years following Haywood, the NBA had no real age limit and freely allowed high schoolers to enter the professional ranks.

The aftermath of the Haywood case led to a boom-and-bust era for high school athletes joining the NBA. Notable players like Kevin Garnett, LeBron James, and Dwight Howard were drafted straight out of high school during this period. However, as mentioned earlier, the landscape changed with the institution of the "one-and-done" rule in the 2005 Collective Bargaining Agreement, which required players to wait one year after high school before entering the NBA draft. This rule has significantly impacted the NBA draft and player development, with the majority of first-overall selections since 2010 being one-and-done players.

Critical Analysis  of the ‘One and Done’ Rule

The "One-and-Done" rule in the NBA is argued to solve the "lemons problem". The lemons problem is a market failure that arises due to asymmetric information between buyers and sellers, where the seller has more information about the quality of a product than the buyer. In application to a basketball context it refers to the difficulty of assessing the quality of high school basketball players who play in varying levels of competition. by allowing a more standardized assessment of the quality of players in the NCAA. This is important because it is difficult to compare high school players competing at varying levels of competition. The rule forces players to take a year after high school to test out or "signal" their quality, providing NBA teams and scouts with more information to make informed hiring decisions.

The "One-and-Done" rule creates a more standardized and informed assessment of the players' abilities, which can be beneficial for both the NBA and the players. By spending a year in college or elsewhere after high school, players have the opportunity to showcase their skills and maturity, which can lead to more accurate evaluations by NBA teams. This, in turn, can help address the "lemons problem" by providing better information for the NBA teams to make hiring decisions. Another benefit is that the "One-and-Done" rule in the NBA has indirectly led to the proliferation of new leagues, such as the Professional Collegiate League (PCL) and Overtime Elite, which are alternative options for talented players out of high school.

While the One-and-Done Rule was intended to channel players into the NCAA for a year, the emergence of these alternative leagues reflects a shift in the landscape of opportunities for young basketball players. This, in turn, has implications for the overall structure of the basketball talent pipeline and the competitive dynamics between different leagues and organizations. The creation of these alternative leagues, although not a direct outcome of the One-and-Done Rule, does have implications for the broader basketball ecosystem. It introduces new options for players, potentially increasing competition for talent and providing players with more choices for their development and career paths.

As a result, the proliferation of these new leagues represents a significant development in the basketball landscape, influencing the dynamics of player recruitment, talent development, and the overall structure of professional and amateur basketball. Contrarily however, The "One-and-Done" rule in the NBA has been associated with anticompetitive consequences for both the NBA and the NCAA. Specifically, the rule has been argued to benefit the NCAA by providing undercompensated labor and talent without competition with the NBA. The rule creates a situation where professional leagues cannot compete with colleges for young talented athletes, leading to colleges and universities only competing against each other in a system where payment beyond full cost of attendance is impermissible.

This is considered anti-competitive because it increases the quality of the players' labor input to college basketball without a corresponding increase in their compensation, as the players' wages in college basketball are fixed. The rule is seen to widen the gap between the value of what the players produce and their compensation, which can directly affect basketball revenue at the individual school and NCAA levels. This, in turn, allows colleges and the NCAA to produce better products without compensating the players responsible for the increase in quality, making the rule anticompetitive. The pertinent question which then arises is whether the aforementioned aspects constitute sufficient reason to scrap the rule altogether?

Should the ‘One and Done’ Rule be Eliminated?

While it seems compelling for the NBPA to suggest the elimination of this rule, it has in fact advocated for the ‘One and Done’ rule. It’s justification behind the same is the impact such a change would have on it’s veteran athletes. This was reflected by the Executive Director of the NBA and his comments on the revised age limit in the new Collective Bargaining Agreement, where he emphasized on the risk of loss of roster spots for various veteran athletes. This potential loss of roster spots for veterans arises out of the new room that would be made for even younger athletes due to the revised age limit. Therefore the complete elimination of the rule, is a decision which would not likely to be made soon.

However an equally efficacious remedy has been implemented with the introduction of “two-way contracts’. These contracts are outside the purview of the 15 man roster that each team has to maintain, and these athletes split time between the parent NBA team and their affiliate G League team. These G League teams have been modeled to act as training grounds for these athletes, for them to hone their basketball skills. Therefore, this solution of a two way contract adequately deals with the problem of unfairly compensated youth talent while also ensuring veteran athletes are not disproportionately impacted.

*The Author is a legal Scholar from India

(The Image used here is for representative purposes only)

References

1) (Terner & Franks, 2021), Modeling Player and Team Performance in Basketball, Annual Review of Statistics and Its Application, Vol. 8, Issue 1, pp. 1-23, 2021, Vol. 8, Issue 1, pp. 1-23

2) Shams Charania, NBA, NBPA expected to agree to end ‘one-and-done rule,’ change draft age to 18 in next CBA: Sources, The Athletic (Sept. 19, 2022) https://theathletic.com/3607520/2022/09/19/nba-draft-age-rule-change-nbpa/.

3) Fashion Originators’ Guild v. FTC, 312 U.S. 457 (1941)

4) Klor’s v. Broadway-Hale Stores, 359 U.S. 207 (1959)