Free agency existed before 1988, but teams had the right to match any offer to their own free agents from another team. If a team chose not to match an offer, they would receive compensation from the second team signing their original player. After the collective bargaining agreement in 1988, players who have had two NBA contracts and at least seven years’ experience were allowed to become unrestricted free agents. That meant there was no compensation for a team losing their own free agents.
Good read about the history of unrestricted free agency, and how the new CBA that came into effect in 1988 gave players more autonomy. Tom Chambers unwittingly became the player to tip it all off, though by his own admission, it could've been anyone; he just happened to sign first, due to the Suns playing hardball.
