What is the Larry Bird rule? With Larry Bird’s rights, a team can re-sign their free agents even if they exceed the salary cap. To do this, a player must spend the last three years in a row with the same team or on the same contract.

Millions of people play Basketball, billions have followed this game. Hundreds of thousands have played it professionally, yet only a few have their names imprinted on the game we all love. There exist these players whose name has become synonymous with grandeur, perfection, excellence, and awe-inspiring performances. Players like Stephen Curry and Michael Jordan are household names because of their performances, statistics, and records. Their legacy surely is unparalleled. But, every player has his own matchups, his own league, his own personal benchmark, and his own legacy to leave.

One such name who not only made it to the very top of the basketball world was Larry Bird. With a playing career ranging between 1979 to 1992, Bird surely gave his fans a lot to cheer, cherish, and look back during his astonishing playing career. His university team, Indiana State Sycamores, retired the jersey number 33 in his honor. He announced his arrival at the big stage with a bang as he won the NBA Rookie of the year in the year 1980. He won 3 NBA Championships with Boston Celtics in the years 1981, 1984, and 1986. In 1984 and 1986, he was also the NBA Finals MVP, while for three straight seasons between 1984-86, he was the NBA’s Most Valuable Player. He made it to the NBA All-star teams an astonishing 12 times while winning the AP athlete of the year in 1986. A healthy 24.3 points per game made the world call him the best natural shooter of the game.  Bird also won the 1992 Barcelona Olympic Gold with the American Basketball team.

On the basis of all these performances, Larry Bird was inducted into the Basketball Hall of Fame in the year 1998. It was a perfect achievement to serve as a cherry at the top of a career that saw more or less every achievement one could imagine. It indeed is very true that his name and memories will always remain alive in the world of Basketball.

Despite all these accolades, accomplishments, and honors, these achievements are not the only reason why the Basketball world, and especially the NBA Universe, remembers and recalls Larry Bird. There is a rule named after him in the rulebook of NBA, which makes the whole equation very interesting.

What is the Larry Bird Rule?

While Bird was himself a player of exceptional ability and wondrous talent, the rule named after him is also an exception created to complement the league’s operations. So, what exactly is the larry bird rule, and what are its benefits?

To exactly understand the Larry Bird Rule, it is important to first understand the dynamics of NBA auction Drafts. Each team has a fixed budget to spend on the players and formulate a team. Different players are picked for different price tags, and those prices are deducted from the fixed budget. This fixed budget is the same for all the NBA teams, and no team is allowed to exceed it. This is called a fixed salary cap.

This means that there is a fixed amount that each team can spend to build a strong squad for the upcoming season, and no team is allowed to exceed that budget. Thus, each team offers an equal chance to prepare its squad during the auction stage.

However, an exception is created with the Larry Bird Rule. This rule allows teams an opportunity to sign their free-agent players even if their values and salaries exceed the fixed salary cap.

Therefore, the Larry Bird rule is an exception to the original NBA fixed salary Cap rule that allows “teams to sign their free agents for additional amounts even if they exceed the fixed salary cap.”

With this exception, a soft salary cap exists in the NBA draft.

What is this Soft Salary Cap in NBA?

Though NBA has a fixed salary Cap, this salary cap is called a soft Salary Cap because it has created certain exceptions that allow teams to exceed this fixed salary cap. With all these exemptions, this salary cap is called a Soft Salary Cap. This Soft Salary Cap is adjusted before the season, and it allows the teams and management to have a vague idea about the spendings of the season.

More or less, all the teams make use of the Larry Bird Rule and other exemptions to exceed the budget.

Condition for the Larry Bird Rule

Though it is a very helpful exception for teams to re-sign their own players, there exists this necessary condition that for a team to re-sign any player, he must have spent at least three years with the team. Otherwise, teams cannot make fully make use of this Larry Bird Rule and have to manage with a lower degree.

Thus, Larry Bird Rule is only fully applicable if a player has spent at least three years with a team. Otherwise, no such exemptions can be availed.

What are Bird Rights?

In order to judge the eligibility of a player for the Larry Bird exception, there exists this parameter of Bird Rights. These rights not only clarify the players standing but also encourage the negotiation process and increase the possibility of the retention of a player and an extension in the agreement between a team and player.

There are three different categories of Bird Rights in the NBA. These are:

Full Bird Rights

These rights can only be exercised if a player has remained with a team for at least three years. This grants the team full bird rights for that player who has spent at least three seasons with the team.

This full degree of Bird Rights allows the players to earn 25, 30, or 35% of the original in-place salary cap. There are various examples of players going from one or two million Dollar earnings to 20-25 million dollar earnings through these Larry Bird Exceptions.

Early Bird Rights

If a player has spent at least two years with a team without leaving in free agency, the team has Early Bird Rights for that player.

This category of bird rights allows a team to pay 175 percent of a player’s original salary or 104.5 percent of the average league salary, depending upon the higher one.

Non-Bird Rights

The third category of Bird-Rights is of Non-Bird Rights. A team gets a player’s non-bird rights if that player has spent only a single year with the team.

This category of bird rights only allows teams to pay up to 120 percent of the original salary of a player. Thus, the teams can go beyond the cap but only by a margin of 120%.

These three categories are made to further add to the spice and interest of the retentions and contract signing in the NBA.

When was the rule enforced?

The rule was invented to support and promote the negotiations between players and their respective clubs. In order to ensure an efficient growth of the game so that it may reach broader circles around the world, this rule was brought into effect in the year 1983. Hence, if a team had a player playing since 1980 and his contract expired, they could use the Larry Bird exception to renew his contract despite exceeding the Fixed Salary Cap.

Boston Celtics had signed multiple players in the year 1983, and Larry Bird was the most prominent of those signings, as he was given a 7-year contract. Boston Celtics went on to win the NBA Championship next year.

Was Larry Bird the first player to receive the benefit of the new rule?

No, it is a total misconception that Larry Bird was the first player to be signed with the help of the famous exception, which later became known as the Larry Bird Rule. Actually, Boston Celtics didn’t even make use of the rule to sign Larry Bird. As a matter of fact, the limit of the Salary Cap was applied to the Boston Celtics in the year 1984, while Bird had already been signed a year earlier. However, such was the magnitude of the signing and the relevance of the prevalent circumstances that the Larry Bird re-signing became the Larry Bird Rule.

Another Larry Bird Influence and Rule

Another rule that is often regarded as an NBA rule has Larry Bird’s influence on it. As it stands, rules do not allow the NBA-selected players to go back to the NCAA for their college-level plays. These rules came into effect because Larry Bird decided to stay at his college team of Indiana State for an additional year despite being selected in the NBA draft in the year 1978.

Actually, NBA rules do allow players to go back to their college teams, but the NCAA rules do not permit such returns to the college-level sport once a player has been picked for the NBA.

This shows how much the phenomenal Larry Bird has influenced the rule books of the NBA.

Views about the Larry Bird Rule and exceptions

Many people opposed the idea of the Larry Bird rule for multiple reasons. A segment of people believes that the Larry Bird rules were unfair and biased as they allowed ways for the teams to exceed their salary cap and tilt the balance in one direction or another. This school of thought firmly believes that a fixed salary cap should be available for all the teams without any exceptions or exemptions. Often, this Larry Bird Rule is also called a loophole in the original system of drafting players.

Another reason why the Larry Bird rule is opposed is that some people believe that this rule may result in lesser salaries of promising players who deserve more value and purchase for their talent, skill, and performance.

Despite these opposing arguments, the Larry Bird rule does indeed add to the drama, interest, and intrigue of the whole team-building process. A very fine feature of the rule is that it increases the possibility of a contract extension between players and teams. This results in extended associations between players and franchises. These extended associations are in the best interests of the league as well as the teams.

For instance, Larry Bird may not have enjoyed as successful a run and as famous a brand as he did because of his lengthy career at the Celtics. Similarly, many other players have continued with teams for multiple years because of these exceptions. It indeed is a great joy for fans to see their favorite players continue with their favorite teams.

Future prospects of the Larry Bird Rule

No one can say a thing about the future with 100% certainty. The only possibility that exists is of predicting the future and hoping that the predictions do come true.

In the case of the Larry Bird Rule, it would be fair to say that the rule may continue in its current form for numerous years till something superior replaces it. Despite all the claims, the only possible changes that may come under consideration would be of increasing the salary cap and salary percentages. Otherwise, the rule has been used as an important team-building tool, and the team may continue to exercise it this way.

Larry Bird gave his fans a lot to cherish, enjoy, remember, and celebrate. One such thing is this amazing Larry Bird exemption rule that only adds to the drama and spice of the NBA team-building process.