With the arrival of two new franchises and a host of big-name signings, the 2015 Major League Soccer season looks to be one of its most important ever. But with opening day just around the corner, key elements of the unique structure that has allowed MLS to survive some very lean times and expand aggressively in more recent years are being challenged. The league and the players’ union have been locked in a collective-bargaining fight that threatens to wipe out a not-insignificant portion of the season—and with it the momentum the league has gained over the past decade.
Unlike most professional sports labor negotiations, it does not appear that money is the main factor here. According to Jeff Carlisle of ESPNFC.com, the league is prepared to increase both a player’s minimum salary and the per-team salary budget—currently $36,500 and $3.1 million, respectively. There have been rumblings for several years that the more well-heeled ownership groups are pushing for greater spending freedom, and perhaps no single step the league could take would help to improve the quality of play than increasing compensation.
Yet, from the perspective of current players, too drastic a raise might actually be seen as a negative, as those on the lower end of the salary scale could find it difficult to keep their jobs since they could be replaced by more expensive options from outside the league. In that sense, a significant increase to salaries that falls short of drastically changing the landscape is likely the preferred option of both sides. While there are sure to be disagreements as to what exactly constitutes such an increase, finding an acceptable middle ground should be relatively easy.
The real threat to the season is the players’ desire for greater freedom of movement. In the eyes of soccer’s international governing body, FIFA, MLS is the “club” that owns all players’ rights. Because of this, the league has an unusual level of control over player movement.
This is how it works: At the end of each season, out-of-contract players enter into a comically protracted reshuffling process. Unless a player is in a position to negotiate a significantly higher salary due to interest outside the league, he is expected to report to whichever team gains ownership of his MLS rights and accept a modest raise. This does artificially deflate salaries, but, more important, it helps keep teams relatively well-balanced in terms of talent.
From the beginning, MLS player acquisition rules were largely designed to avoid the fate of the North American Soccer League. In the mid-1970s, that league briefly gained a foothold before suffering financial collapse after teams with financial means took full advantage of them, and the gap between the haves and have-nots proved fatal. The lessons learned from the NASL became almost a guiding principle for MLS during its lean early days. But now average attendance is on the rise; a lucrative new television deal with FOX Sports begins this season; New York City FC will enter the league after paying a $100 million franchise fee in 2013; established and in-demand players continue to choose MLS over other suitors; and the long-term popularity of soccer in the U.S. seems secure. Times have very clearly changed.
In the interest of ensuring the league’s survival, players once were willing to accept a protectionist structure and salaries so low that they often needed a second job. But in the current CBA negotiation, with the league on solid financial footing for the first time, the players seem significantly less willing to kick that can down the road. MLS union reps have steadfastly claimed that there will be no new deal without free agency, while the owners have been equally resolute in stating that free agency is strictly off the table.
As in any labor negotiation, both sides are bluffing. While the players would almost certainly love to have a system that allows open bidding for their services, they’re fully aware that the owners aren’t going to accept any such thing; the structure of MLS simply won’t allow it. But while “true” free agency, like that seen in most of the rest of the world, isn’t currently feasible, some solution that will protect the league’s single-entity status while giving players greater autonomy is almost certainly possible.
And that’s likely all the players are asking for. So long as MLS maintains such a strict cap and holds veto power over all player transfers and contracts, there’s little risk of bidding wars or financial implosion. In speaking to the media, the players have consistently maintained that they were prepared to strike over free agency, and with highly visible—and highly paid—players such as Michael Bradley stepping to the forefront of the conversation, it’s a pretty powerful message.
But the reality is that the union’s leverage begins to disappear quickly once a work stoppage begins. According to player agent Ted Philipakos, based on publicly available data from 2013, the union has approximately $6 million to support its members in the event of a work stoppage. Those funds won’t last long. And given the financial realities facing the majority of players in the league, enduring months of lost wages could be potentially devastating. While MLS players are no longer subsisting on poverty wages, the majority of players aren’t living in luxury, either. In that sense, the odds would seem to favor a quick resolution.
Sounders fans should hope that this is the case. Six years of record-setting and steadily increasing attendance seems to indicate that the fan base’s passion for the team is anything but a fad. But even if the Sounders are largely unaffected, it’s far from guaranteed that other teams will be so fortunate. Teams that haven’t achieved the same level of engagement and sustained success aren’t likely to find their fans as willing to come back to the games. With the new financial realities of the league demanding real investment in order to remain competitive, those clubs could be severly hamstrung by a lack of revenue. As the history of professional soccer in the U.S. can demonstrate, managing to sustain interest in a select few markets isn’t nearly enough for a league to thrive. And with the fate of teams in MLS being so completely intertwined, a loss of engagement in multiple markets would be a huge blow to the league and with it, the Sounders. E
news@seattleweekly.com
Aaron Campeau is the co-host of the Seattle Sounders podcast Nos Audietis, a contributor to Sounder at Heart, and a Sounders season ticket-holder. He continues to believe that trading
Alvaro Fernandez
was the biggest mistake the team has ever made.
VERSION 2
With the arrival of two new franchises and a host of big-name signings, the 2015 Major League Soccer season looks to be one of its most important ever. But with opening day just around the corner, key elements of the unique structure that has allowed MLS to survive some very lean times and expand aggressively in more recent years are being challenged by the players’ union in a collective-bargaining fight that threatens to wipe out a not-insignificant portion of the season—and with it a great deal of the momentum the league has gained over the past decade.
Unlike most professional sports labor negotiations, it does not appear that money is the main factor in the divide. According to Jeff Carlisle of ESPNFC.com, the league is prepared to increase both a player’s minimum salary and the per-team salary budget—currently $36,500 and $3.1 million, respectively. (A note on the salary budget: Each team is allowed three “Designated Players” whose salaries are functionally unlimited but whose cost against the budget is equal to the “maximum” player salary, which was $387,500 in the 2014 season. This was the mechanism put into place to allow the Los Angeles Galaxy to sign David Beckham in 2007.) There have been rumblings for several years that the more well-heeled ownership groups are pushing for greater spending freedom, and perhaps no single step the league could take would help to improve the quality of play than increasing compensation for players outside of the top tier of earners in MLS.
From the perspective of the players, too drastic a raise to salaries might actually be seen as a negative, as those on the lower end of the salary scale could find it difficult to keep their jobs given an increased ability of teams to replace them with more expensive options from outside the league. In that sense, a significant increase to salaries that falls short of drastically changing the landscape is likely the preferred option of both sides. While there are sure to be disagreements as to what exactly constitutes such an increase, finding an acceptable middle ground should be relatively easy.
The real threat to the season is the players’ desire for greater freedom of movement. In the eyes of soccer’s international governing body FIFA, due to its single-entity structure MLS is the “club” that owns a player’s rights. Because of this, the league has a level of control over player movement that is significantly higher than is typical internationally. Even in the context of major North American sports, MLS is unique; while other leagues place multiple restrictions on free agency, at a certain point players are free to accept the most attractive offer presented to them by any interested parties. In MLS, that’s almost never the case.
At the end of each season, out-of-contract players enter into a comically protracted reshuffling process seemingly designed to snuff out any illusion of freedom of choice on behalf of the individuals most directly affected. And unless a player is in a position to negotiate a significantly higher salary due to interest outside the league, they are expected to report to whichever team gains ownership of their MLS rights and accept a modest raise to their previous contract. This artificially deflates salaries to some degree, but perhaps more important for the league it helps keep teams relatively well-balanced in terms of talent.
From the beginning, MLS player acquisition rules were largely designed to avoid the fate of the NASL, the league that briefly gained something of a foothold in the mid-1970s before suffering financial collapse. Teams with financial means took full advantage of them, and the gap between the haves and have-nots ended up killing the league. With MLS so often on perilous ground financially in the early days, the lessons learned from the NASL became almost a guiding principle. But the times have very clearly changed: Average attendance is on the rise; a lucrative new television deal with FOX Sports begins with the 2015 season; New York City FC will enter the league after paying a $100 million franchise fee in 2013; established and in-demand players continue to choose MLS over other suitors; and the long-term popularity of soccer in the U.S. seems to be quite secure.
In the interest of ensuring the league’s survival, players once were willing to accept a protectionist structure and salaries so low that a second job was often a requirement. But in the current CBA negotiation, with the league on solid financial footing for the first time, the players seem significantly less willing to kick that can down the road. MLS union reps have steadfastly claimed that there will be no new deal without free agency, while the owners have been equally resolute in stating that any form of free agency is strictly off the table.
As in any labor negotiation, both sides are bluffing. While the players would almost certainly love to have a system that allows open bidding for their services, they’re fully aware that the owners aren’t going to accept any such thing; the structure of MLS simply won’t allow it. But while “true” free agency, like that seen in most of the rest of the world, isn’t currently feasible, some solution that will protect the league’s single-entity status from legal challenges while giving players greater control over their own destiny is almost certainly possible.
And that’s likely all the players are asking for. So long as MLS maintains such a strict cap and holds veto power over all player transfers and contracts, there’s little risk of bidding wars or financial implosion. In speaking to the media, the players have consistently maintained that they were prepared to strike over free agency, and with highly visible—and highly paid—players such as Michael Bradley stepping to the forefront of the conversation, it’s a pretty powerful message.
But the reality is that the union’s leverage begins to disappear quickly once a work stoppage begins. According to player agent Ted Philipakos, based on publicly available data from 2013 the union has approximately $6 million to support its members in the event of a work stoppage. Exactly how long that could sustain the players depends entirely on how the money is distributed, but given the number of dues-paying members—most of whom make a comfortable but far from exorbitant living in a profession with a very short expected duration—it’s difficult to see those funds lasting for an extended period.
Labor negotiations in professional sports are often viewed as squabbles between millionaires and billionaires, and while that reductive framework ignores some of the core issues at play—said billionaires profiting inequitably off the labor of said millionaires, for example—it’s still instructive. As a general rule, players in major American sports don’t have to worry about paying their mortgage or putting food on the table. Similarly, owners of major American sports franchises don’t have to worry about their investment suddenly becoming worthless. Each of the big four leagues have endured nasty and prolonged work stoppages, with the NHL managing to survive the loss of an entire season.
But in MLS, the stakes are much higher for both sides. In spite of its increased growth and stability, whether the league is on strong-enough footing to shake off a protracted strike or lockout is unknown. And given the financial realities facing the majority of players in the league, enduring months of lost wages could be potentially devastating. While MLS players are no longer subsisting on poverty wages, the majority of players aren’t living in luxury, either. In that sense, the odds would seem to favor a quick resolution to any disruption to the start of the MLS season.
Sounders fans should hope that this is the case. Six years of record-setting and steadily increasing attendance would certainly seem to indicate that the fan base’s passion for the team is anything but a fad. But even if the Sounders are largely unaffected, it’s far from guaranteed that other teams will be so fortunate. Teams that haven’t achieved the same level of engagement and sustained success aren’t likely to find their fans as willing to come back to the games, and with the new financial realities of the league demanding real investment in order to remain competitive, a lack of revenue could severely hamstring a club’s ability to compete. As the history of professional soccer in the U.S. can demonstrate, managing to sustain interest in a select few markets isn’t nearly enough to allow a league to thrive. And with the fate of teams in MLS being so completely intertwined, the effect of a loss of engagement in multiple markets would be a huge blow to the league’s ability to continue to build on the progress that’s been made over the past several years. E
news@seattleweekly.com
Aaron Campeau is the co-host of the Seattle Sounders podcast Nos Audietis, a contributor to Sounder at Heart, and a Sounders season ticket-holder. He continues to believe that trading
Alvaro Fernandez
was the biggest mistake the team has ever made.