NIL-Style WNBA Payments Threaten League Integrity, Prompt Investigation

Las Vegas Ace's team-wide endorsement deal allows players to be compensated 82% above Salary Cap

Oct 18, 2023; Brooklyn, New York, USA; The Las Vegas Aces celebrate after winning the 2023 WNBA / Wendell Cruz-USA TODAY Sports

The WNBA has opened an investigation on the two-time defending finals champion Las Vegas Aces regarding a full-team endorsement deal with The Las Vegas Convention and Visitors Authority (LVCVA). The deal purportedly gives every player on the Las Vegas Aces 12-woman roster member a $100,000 sponsorship annually for the 2024 and 2025 seasons. For context, this endorsement deal pays more than the team salary for exactly half of the Las Vegas Aces’ roster. The Ace’s organization was not directly involved in creating this sponsorship deal and appears not to have violated any explicit WNBA salary cap rules.  

While no decision has been made by the WNBA, there is a growing concern about the potential impact on competitive integrity within the league. This concern parallels the NCAA's current NIL Collective system, where athletes are enticed to enroll at colleges through lucrative ‘pay-for-play’ salaries funded by university boosters. These ‘pay for play’ salaries are masqueraded as endorsement deals to comply with state law and NCAA guidelines. 

Like collegiate sports, the WNBA is structurally unable to compensate its athletes with the million-dollar contracts that are commonplace in major American men’s professional sports, making the league susceptible to the improper funding of interested parties. In the WNBA, a supermax contract (the highest salary possible) is capped at $241,984; in the NBA, the league minimum for a three-year veteran is over $1,6000,000. Using guaranteed endorsement contracts, as seen by LVCVA, WNBA franchises would have the ability to leverage wealthy fans and local corporations to evade salary cap restrictions and ultimately have a colossal advantage in signing players in the free-agency market. For men’s professional sports, the amount of money needed to implement a similar NIL Collective style regime is not impossible but is highly unlikely.  

Something I often repeat to my Sport Management students is that “Professional sports in America are Socialist and European sports are capitalist”; that is to say that American sporting concepts like drafts, salary caps, and league revenue sharing diverge from the free-market policies of Western European soccer leagues –– all in the interest of promoting competitive parity. In my opinion, these guardrails have made American leagues captivating because they don’t embargo the formation of super teams but require that the talent acquisition of great teams comes from elite scouting and front-office decision-making rather than elevated financial status.   

The current WNBA salary cap is $1,463,000. The $1,200,000 total compensation in the deal from the LVCVA theoretically shifts the Las Vegas Aces salary cap to $2,663,000, a roughly 82% spending advantage over other teams in the league without such endorsement deals in place. While endorsements are not to be conflated with salary, as many WNBA players have generated large amounts of money through individual endorsements and should maintiain the right to do so, guaranteed team-wide endorsement deals are a unique subset of athlete compensation that should be investigated due to the high-risk of erosion to competitive parity. 

The LVCVA deal, nefarious or not, raises significant concerns about the WNBA’s ability to maintain the fairness that the salary cap intended and ultimately maintain an entertaining product. This issue is not singular to the LVCVA deal; theoretically, if the WNBA does not find a way to curtail this behavior, any team could leverage wealthy fans and companies to evade salary cap restrictions. How the WNBA handles this situation is important precedent-setting that should be closely monitored.