The pace of negotiations on a revised Collective Bargaining Agreement (CBA) between MLS and the MLS Players Association (MLSPA) is accelerating, although it's unclear where, or how, it will end. With the clock ticking, here's a rundown of where things stand, what possible outcomes remain, and where they're headed.
Where do things stand?
The MLS Players Association and the league reached a tentative agreement on Friday, Feb. 5, on a revised CBA that should see the two sides avoid a lockout of the 2021 season. The deal is pending the results of a likely weekend vote by the players and the MLS board of governors to ratify the deal.
On Thursday, Feb. 4, MLS announced that it was extending its negotiating deadline by 24 hours until 11:59 p.m. ET on Feb. 5. If an agreement isn't reached by then, the league will terminate the CBA and lockout the players.
"Although we have not finalized a new Collective Bargaining Agreement and remain apart on some key issues, discussions this week have been productive, and we have made progress," MLS said in a statement on Thursday." Since the negotiations have reached an advanced stage, the League has extended the negotiating period by 24 hours to provide every opportunity to finalize an agreement."
Not much else has changed. While the extension hints that an agreement is near, there are no guarantees one will be reached.
A week ago, the MLSPA submitted its latest offer to MLS and, according to some observers, met MLS halfway. The union agreed to extend the CBA by one year through 2026, while also reducing the salary cap every year from 2022 to 2025. The revenue-sharing plan for the next media rights deal was also reduced from 25% to 12.5% for 2024.
In return, the MLSPA wants MLS to lower the threshold for free agency to players 23 years of age or older and with at least four years of service in the league. That's compared to the existing threshold of 24 years of age and five years of service. According to the MLSPA, this will save MLS $53 million.
How hard is that deadline?
That depends on who you talk to. The league insists the deadline is real, but they said the same thing about the previous deadline, one borne out of the force majeure clause it invoked to reopen CBA negotiations on Dec. 29. That clause opened a 30-day negotiating window on a revised deal and specified that if a deal wasn't struck within that time frame, either side could terminate the CBA. Let's be clear, however: If any side decides to blow up the CBA, it will be MLS. The MLSPA has long said it intends to honor the agreement the two sides reached in June, and won't go on strike.
The MLSPA maintains that any talk of a deadline is artificial and not legally binding in any way. The regular season isn't scheduled to start until April 3, meaning there's still time to get a deal done.
What has MLS been angling for?
Ever since MLS invoked the force majeure, it has wanted a two-year extension and a freeze of the salary cap from 2021 to 2022. In their most recent proposal, they offered to increase the growth rate of the salary cap between 2026 and 2027 by 2.5%. But all told, they are asking for between $100 million to $110 million in economic concessions. This is on top of the $150 million in concessions that the MLSPA said it made in the previous CBA that was negotiated last June.
Another factor is the proximity to the 2026 World Cup, which is set to be co-hosted by the U.S., Canada and Mexico. By having a CBA that ends 18 months after the World Cup, the players would lose considerable leverage to extract concessions or go on strike at a moment that is critical for MLS and its stakeholders -- such as its marketing arm, Soccer United Marketing. The one-year extension the MLSPA is proposing would carry the CBA past the World Cup, but is still close enough to the tournament that a strike might kill some of the momentum the World Cup would generate.
Haven't the league and the union been down this road before?
Indeed they have. The two sides agreed in principle to terms on a new CBA last February. Then the pandemic struck, and the league shut down on March 12. The fact that neither side had ratified the CBA allowed the league to reopen negotiations.
The talks were contentious, but in June, with the league idle for almost three months, the two sides settled on a deal in which the players agreed to salary cuts of 5% when applied to yearly salaries (7.5% going forward), as well as cuts to bonuses that the MLSPA contends amounted to 70%. The terms of the CBA were also pushed out a year, extending the expiration date through the 2025 season, resulting in an overall compensation freeze from 2020 to 2021. The terms of a revenue-sharing agreement based on the aforementioned new media rights deal was reduced in 2023 by 12.5%.
Most critically of all, the two sides agreed to the insertion of a force majeure clause that allowed either side to reopen negotiations in the event of an economic catastrophe, like that brought on by a pandemic. With MLS dependent on game-day revenue, it remains concerned that it is looking at another season with few fans -- and in some cases no fans -- in the stands, depending on how vaccinations go. The league contends it lost nearly $1 billion in 2020, with $725m of that due to COVID-19.
What happens now?
The two sides will continue to negotiate. MLS was expected to submit an offer to the MLSPA by Saturday, sources told ESPN. But so far, the league hasn't budged much from its initial position -- the only change is an increase in the salary cap by 2.5% between 2026 and 2027 -- while the MLSPA has moved considerably, offering a one-year extension, reductions in the salary cap between 2022 and 2025 and a reduction in the revenue-sharing percentage of media rights. The league said there is also a set schedule of meetings over the next week, although one union source said nothing had been explicitly spelled out. Expect there to be more back and forth until the next deadline.
Once that deadline is reached, there are basically three possible scenarios: the two sides can accept the deal, MLS can extend negotiations with another deadline or MLS can terminate the CBA and then lock the players out.
If a deal is reached, the two sides can begin preparing for preseason like they normally would. Training camps are set to open on Feb. 22, with the season following in early April. That's about a month later than in 2020, but the additional time means more people could be vaccinated against COVID-19, making it more likely that games will be played in front of fans.
If MLS opts to continue negotiations, the talks will carry on as before. It would be a positive sign as well in that both sides seem to be converging on a middle ground.
What if the deadline passes without a new agreement?
The league will go with the nuclear option of terminating the CBA and locking out the players. Technically if the league terminates the CBA, games could hypothetically still take place, and players would still be operating under the old deal. But practically speaking, the no-strike/no-lockout provision of the CBA would be gone, paving the way for a lockout. It's telling that the league has consistently spoken of CBA termination and a lockout in the same breath. In a memo sent to league staff on Wednesday, MLS president and deputy commissioner Mark Abbott said the league and its teams should prepare for a lockout.
If the league takes that step, it wouldn't be long before the players would feel financial pain. The players are paid twice a month, not per game, and one missed paycheck would amount to about 3.8% of a player's yearly salary. The first paycheck that would be missed would come on Feb. 15.
Abbott's memo said the league would continue to provide healthcare benefits to the players and their families, an important dynamic amid the pandemic. And the MLSPA has long been telling players to prepare for a lockout. But the MLSPA is still a relatively young union with almost $13m in assets. For a player pool comprised of more than 700 players, any kind of work-stoppage fund is bound to run out pretty quickly.
If the players are locked out, could they seek employment elsewhere?
They could, but unless they were released from their MLS contracts, they would have to return once a work stoppage ended. Given that the transfer window in most of Europe closes on Monday, Feb. 1, the lockout scenario doesn't leave players with much in the way of options.
One possibility is that some players could look to the second-tier USL Championship. One manager in that league said that agents "are starting to sniff around to make sure their players have landing spots," although it's unclear how the league itself feels about this.
How much damage would a lockout do?
Plenty. The optics would be terrible, and it would further damage a relationship with the players that MLSPA executive board member Ethan Finlay called "fractured." There is no chance the players will be looked upon as being greedy given they have already made concessions.
Will that matter? In the long run, probably not. But a lockout would also further halt momentum that has already been compromised by the pandemic. With the aforementioned media rights deal ending in 2022 (the existing U.S. rights package with ESPN, FOX Sports and Univision Deportes runs to the end of 2022), an extended lockout runs the risk of depressing interest in the league and by extension the deal's value.
Another factor to consider is if the lockout were to last long enough to where games are canceled or postponed, MLS runs the risk of losing whatever mindshare it has. It's one thing to not be playing when every other American sports league wasn't due to the pandemic, which was the case last spring, but come April, the NHL, MLB and the NBA will be in action. Can MLS run the risk of sidelining itself?
The league and the union -- and most of all, fans -- will be hoping it doesn't come to that.