Navigating the 2015 MLS CBA Negotiations

Just days before the opening match of the 2010 season, MLS league officials and the Players' Union struck a deal on a collective bargaining agreement (CBA) following months of tense and arduous negotiations. The story revolved around players breaking into a new era of the league's history, demanding higher wages, and transfer movement free from league control. With the help of a federal mediator, the two sides managed a resolution of give-and-take that left the players with, among other details, a pay raise on minimum salaries and the Re-Entry Draft.

While that CBA expires next week (January 31), the two sides come back to the negotiating table with an unwritten agreement to continue with preseason preparations and training (there are CONCACAF Champions' League fixtures coming up, after all). When it comes time to begin the historic 20th season on March 6th, both sides of the table want to celebrate that milestone without the threat of a work stoppage.

But the new story revolves around much of the plot from 2010; higher compensation and free agency. For its part, the league is in a tougher spot to negotiate after five years of incredible success with expansions, ownerships, and gate totals. Add to that a brand-new television deal that will net the league $90 million annually over eight years and the players seem well-staked to demand a bigger revenue cut.

THE STANCES

The league, led by President and Deputy Commissioner Mark Abbott, is prepared to move forward but does not want to fundamentally alter any of the unique league structures. Commonly, MLS cites the rigid structure of low salaries and lack of free agency as important in controlling how the league invested and grew to this point. Not where they want to be quite yet, Abbott wants to preserve this structure to further evolve the league going forward.

The players' union, led by Executive Director Bob Foose, contends that they are not trying to overhaul the structure of the league overnight but do believe significant changes are currently needed. The debate over the league's single-entity status is not a focal point of these negotiations and the union wants to respect the investment of the league's owners.

Both sides feel a mutual and matured trust with each other as the negotiations begin in earnest but have publicly recognized that they remain "far apart" on two significant - and familiar - issues.

COMPENSATION

Salary/Minutes (Players under 100k)  - Courtesy Watchful1 from Reddit
Large image found here. Non-DP salaries to include over 100k here.

This image tells much of the players' union story. In 2014, the league saw many players with relatively low contracts playing, in some cases, significant minutes. Bobby Warshaw, a former FC Dallas player and perennial low-earner, wrote about the life of one of these players last week. His sentiments, echoed by Foose, are such that players like him and those shown above make the backbone of the league's labor. Within that role, players that see a minuscule fraction of the revenue are asked to train, perform, and excel while constantly questioning whether this is a good career to pursue. To hear it from the union, these players are psychologically unable to play at their highest level burdened by stresses (making rent, cost of living, etc.) that surpass the realm of sport.

And so, the players of MLS want minimum wages to increase and a better-compensated middle class athlete. The current structure ranks MLS 22nd in average salary ($207,831), behind the domestic leagues of Switzerland, Ukraine, Austria, Denmark, and Greece. Mexico's Liga MX (of which MLS competes against in CCL) ranks 10th at $416,000.

The numbers are likely to rise as a result of negotiation, but the question of "how much" remains. Foose understands that any increase in compensation must be tied to an increase in league revenue though the two groups disagree on how much that revenue will rise in the coming years. The league has reported annual losses of $100m (though have not given specifics on the figure) and contend that, with largely full stadiums in the biggest markets and a fixed 8-year television deal, revenue growth will be limited. Figuring out how to agree on an accurate figure for revenue growth will be the key to settling this phase of discussion.

FREE AGENCY

This issue may ultimately signal a work stoppage. Compensation negotiation is a slow beast but the push-and-pull will leave both groups eventually at a mutually satisfying number. The concept of free agency threatens the identity of the league. When asked, Abbott gestures to the genesis of MLS and is steadfast in belief that the league's structure of player movement has allowed for stabilized salaries, smart investment from a broader perspective, and prevented its stars from fleeing to Europe.

Free Agency, says Abbott, cannot coexist with a salary cap (the cost-limiting measure is not at risk during this CBA but will likely see an overall bump). MLS competes in a global market for players as opposed to, say, the NBA or NFL. When a player is free to leave a club, the possibility that a team from another market (be it England, Denmark, or Mexico) can swoop in and pay what a cap-restricted MLS club cannot will suck the talent from the league. If MLS controls the contract of the player, it can better determine whether the player leaving would be to the detriment of the league.

Fosse and the union contend that the talent poaching isn't happening not because of a lack of free agency but because MLS players are not in high demand. Instead, free agency can exist fully within the single-entity system, guarantee a player receives compensation that he is worth, and allow the freedom (and incentive) for the player to remain in MLS. As it stands, the convoluted system acts as a detriment to recruiting foreign players and a trap of sorts for those currently existing within. The Re-Entry Draft sought to provide relief in the 2010 CBA but, in practice, has not worked to the players' benefit. Instead of allowing a player more movement within the league, the player often has no control over who might pick them and, with the structure of salary negotiation in phases, it's likely the player will have to take a lower wage to continue playing in MLS.

One compromise the union is prepared to offer is allowing for players to enter free agency after meeting a requirement of games played or years under contract. This would provide incentive to the player to remain in the league rather than tie themselves into another league-controlled contract.

WHERE WE STAND

The league and players' union representatives have met twice now since the end of the season, most recently on Tuesday, January 20th. These early meetings are typically an opportunity to share beliefs on issues ahead of hashing out details in meetings during February.

In the December meetings, Foose optimistically shared that MLS offered responses to about 75% of the proposed issues from the players' union, but had yet to address free agency. After Tuesday's meeting (attended by Kofi Sarkodie and ex-Dynamo Bobby Boswell), moods felt bitter. After an invitation by the union to address free agency and discuss compromises (like the one above), MLS issued a proposal and did not acknowledge the issue of free agency. The players' union has cancelled the second day of meetings and the two sides will reconvene likely next month.

While still in the early stages of negotiation, no one expects to have a significant amount of work complete. Players have become more vocal over recent weeks, publicly discussing negotiations, salary discrepancy, and the very belief that free agency is worth a work stoppage. Still, a players' strike is unwanted and the two sides continue to work on negotiations. As is typical, CBA discussions go to the final minute with both sides growing more stubborn by the week until a strike feels imminent. While it appears the players will receive much of what they want from a new CBA, the issue of free agency appears to have taken the forefront and the union appears to have taken the opportunity to make their stand.