No, that's not how it works. Teams are allowed to offer more money to their own players. bird rights give current teams the ability to go over the cap to sign their own free agents, but only up to the maximum salary. and it only applies, obviously, if the team is close to the cap. the cavs aren't close to the cap, if we're really talking about lebron. in addition, current teams can offer 2.5% more in raises per year, but that only gives current teams advantages in years 2-6. however, if another team signs a FA, in year 4, they gain bird rights, meaning that they can offer the 2.5% raise starting after year 3. giving the home team a 2.5% advanatge in years 2 and 3 of any contract. not much of an advantage they CAN offer a 6th year, which other teams can't, though. Doesn't that mean that they have a decent advantage for the rest of the contract? The other team can't raise the ~5% that's already been hypothetically raised in years 2 and 3 plus the 2.5% in year 4, so the current teams salary will be larger than the new team in each year, and the difference will actually grow since you'll be raising 2.5% of a larger base. I believe the percentage raise is based off the year one salaries, so there's no compounding. exactly.