The NBA and the National Basketball Players Association have agreed on a deal that will withhold 25% of each player paycheck beginning on May 15, the NBA announced Friday.
The agreement gives players a gradual reduction in salary if the Force Majeure provision is enacted, marking the cancelation of regular-season games.
The league could exercise the Force Majeure clause in the collective bargaining agreement, which covers for catastrophic circumstances. Once there is a cancelation of games, the clause is automatically triggered.
The use of the clause protects against a dramatic drop in the salary cap and luxury tax for next season, but it would also lead to a more immediate financial impact on the league's players.
The NBA continues to be open to the idea that the season will resume at some point, but the NBA's financial future was seemingly made more complicated by the coronavirus pandemic.
Players were paid in full throughout both March and April.
The salary reductions reportedly include commissioner Adam Silver and deputy commissioner Mark Tatum. There will reportedly not be widespread cuts to the rest of the NBA organization.
It has been just over a month since the NBA suspended its season indefinitely.
As of Friday afternoon, there are more than 2.1 million confirmed cases of the coronavirus, causing at least 144,000 deaths. There are more than 670,000 confirmed cases in the United States.