MLS and MLSPA agree new CBA

The threat of a strike delaying the 2020 MLS season has been averted as the MLS Players’ Association and Major League Soccer have tentatively agreed to terms on a new Collective Bargaining Agreement that will see the league through to 2024.

The CBA – the guidelines on everything from salary cap to travel arrangements – was due to expire in early 2020 with the players’ union pushing for more charter travel, simplifying the financial mechanisms, and increased free agency rights.

“This deal is the culmination of our efforts to engage players from every team to define our goals and push for real progress. Through this work and our solidarity, we have been able to reach an agreement that will provide players with greater rights and increased compensation, and will ensure that the league’s resources continue to be used to create a league of choice for players both on and off the field.”

Jeff Larentowicz, MLSPA Executive Board Member

The most immediate impact fans will see is the end of Targeted Allocation Money. Teams were given $1.2m in TAM, which became the butt of many jokes with its vague rules for use. That has now been converted to General Allocation Money – the long term currency of MLS. The salary cap will rise to $11,643,000 by 2024, a 37% rise on the current $8.4m salary cap. Further spending will be directly tied to MLS’ future media deals which will take effect in 2022. Local, national, and international rights will all be up for negotiating as the league takes further control to centrally negotiate on teams’ behalf.

A new rule that will undoubtedly impact FC Dallas is the “Under-22” Player Initiative. Teams will be able to sign three players under the age of 22 at a reduced cap hit. With FC Dallas running into a problem where there are too many Homegrown Players to keep them on the off-budget portion of the 30-man roster, the new mechanism should help to minimize the impact while providing a contract that is comparable to what players may be able to seek elsewhere.

An infographic produced by the MLS Players Association addressing the 2020-2024 MLS Collective Bargaining Agreement (MLSPA)

There will still be three Designated Player spots on each roster, although the rules have been tweaked to better reward teams who invest in younger talent. MLS will have the right to cap compensation to the roughly $1m level a TAM player would have been for the third DP in cases where the player is over 23. For under 23s, there will be no limit.

Charter travel is a big issue highlighted by the likes of Wayne Rooney and Steven Gerrard in their brief stints in MLS. Teams were permitted to use a maximum of four legs for chartered flights with no minimum. Teams would often save these for the playoffs, which meant many teams would not use their four allotted flights. Now teams will be required to book charter flights for all MLS Cup Playoff and Concacaf Champions League, as well as a minimum of eight legs during the regular season, which will rise to 16 by 2024.

“This agreement addresses key strategic priorities for the league and our players while also retaining the basic player compensation structure that has been the foundation for the growth and stability of Major League Soccer. We had constructive, positive discussions with the leadership of the MLSPA and the players’ bargaining committee during the negotiations over the last few months and I would like to thank them for their collaboration in concluding an agreement that will serve as the foundation for a new era of partnership with our players.”

Major League Soccer Commissioner, Don Garber

Free agency changes will double the number of eligible players. Formerly players had to be at least 28-years-old with eight years spent in MLS. Those numbers will now drop to 24 and five. A hidden clause before was that teams were limited to two free-agent signings per season, which has now been abolished altogether.

The minimum senior salary will rise to break $109,000 per year by the 2024 season, a significant rise from the current $70,250. Players will also see increases to their 401k plans, better medical care, increased moving and travel expenses, and a longer term into their retirement where MLS offers benefits. In total, the MLSPA claims that $55m will be added to performance-based bonuses for players in the four year period.

The 2015-2019 CBA can be found here, courtesy of the MLS Players Association. The new CBA is subject to approval by the MLS Board of Governors and MLSPA membership.

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