Grant Wahl is a senior writer for Sports Illustrated and author of the best seller, The Beckham Experiment. In Tampa for the U.S. Mens National Team's friendly with El Salvador, Grant joined the MLS Talk podcast Wednesday to talk USMNT and, more urgently, the ongoing negotiations in Major League Soccer over a new Collective Bargaining Agreement.

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Major League Soccer is a niche league, perhaps the largest niche league in North America (depending on your view of hockey and the NHL).  It lacks a lot of the tradition, and strength that can be found in older leagues such as the National Football League, or Major League Baseball.  Even the NHL has strong traditions relative to Major League soccer.  Niche leagues fill certain markets, and reach out to small support bases.  They are not immune to problems and possess a wide variety of weaknesses.

One of those weaknesses is the susceptibility to a work stoppage.

Major League Soccer is on the verge of a virtual collapse, and the league seems to think that a collapse is preferable to granting the most basic right a worker has.  The right of mobility and freedom to choose where you work.  In any other line of employment outside of sports, the employer would be clearly in the wrong (and likely taken to court) for doing what it can to restrict labour rights.  But in sports, we tolerate labour violations because there is a perception that we can encourage league competitiveness by restricting labour rights.  Others rationalize the violation of labour rights as a way of keeping players from being paid too much.

Regardless, with any other product this would be considered illegal. But US (and Canadian) law is funny on sports leagues and the product they peddle. So, the Players are going to have to seek a compromise, as legal action on labour issues such as these has failed across numerous sports.

Major League Soccer is moving towards a lockout or strike, both of which would be absolutely terrible for the North American game and a blow to the credibility of the USSF abroad.  There seems to be broad consensus among followers of the league that a strike or lockout would be the death of the league.

The odd thing about this whole situation is that MLS and the Players Union are not far apart on the issues. There remains a major stumbling block which has yet to be overcome.

It is free agency (in combination with player mobility).

Under the current system, players have no right to say no to a trade, and cannot catch on with another MLS team when their contract expires.  And oddly, neither the league or the players seem to be able to come together on a compromise.

Here is what I propose as a solution.  It's a halfway point, known as Restricted Free Agency and is employed in the NHL.

1. Players over the age of 28 or who have played 5 years, consecutively, in MLS are entitled to unrestricted free agency.
2. Players over the age of 28 or who have played 5 years, consecutively, in MLS are entitled to a No Trade Clause.
3. Players under the age of 28 and who have not played 5 years, consecutively, in MLS are entitled to Restricted Free Agency.  Clubs must offer a contract equal or greater in nominal value to their previous contract or the player becomes an unrestricted free agent.
4. Players under the age of 28 and who have not played 5 years, consecutively, in MLS are permitted to negotiate No Trade Clauses into their contracts.

This is obviously not with all the bells and whistles that a "legalese" agreement would require, but it is something which the two groups can work off of.  Maybe the age should be higher, maybe lower. Maybe you should need less or more consecutive years.

But it's something of a compromise and may spark some ideas.

What do you think?  What are your proposals on bridging this volatile issue? Would RFA work in MLS?

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In the third part (of three) in our series on Major League Soccer's labor negotiations, I talked to Major League Soccer Talk contributor Brian Zygo.

After talking to legal and sports business experts in the series' first two parts, I've asked Brian on the show to help bring the issues back to the pitch.  Bring is a practicing lawyer in Houston, and although his expertise is not labor law, his combination of legal knowledge and soccer expertise help translate bring a soccer-lean to the story.

Brian joined me on Thursday night in wake of the news the management and labor had agreed to a negotiating period extending through February 12, twelve days after the current collective bargaining agreement expires.

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In the second of three podcasts Major League Soccer Talk will be devoting to collective bargaining and labor negotiations, I was joined by Joel Maxcy.

Joel is an Associate Professor at the University of Georgia where he also serves as the Sports Management Program's coordinator. He has a Ph.D. in economics from Washington State University, and his research interests include labor economics, sports law, and antitrust.

We start this podcast by picking-up on the American Needle case but eventually transition into talk of single-entity and its effects on incentives to compete.

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In the first of three podcasts Major League Soccer Talk will be devoting to collective bargaining and labor negotiations, I was joined by Jeffrey Standen.

Jeffrey is an instructor at Willamette University in Salem, Oregon where he teaches (amongst other things) Sports Law. He joined me on Tuesday to walk us through the important concepts in labor disputes: the importance of single-entity, how it distinguishes the MLS labor dispute from other sports labor disputes, as well as traditional breaking points for labor during these negotiations.

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In a series podcasts to be released throughout the week, Major League Soccer Talk (subscribe) will be talking to three legal/business/sport experts, getting perspectives on collective bargaining in Major League Soccer and the United States' sports landscape.

In the first podcast (to be released Tuesday or Wednesday), we will talk about the mechanics of collective bargaining, introducing everybody to the intricacies of the process (i.e., the practical differences between strike and lock-out).  Our guest will be Jeffrey Standen, a professor of law at Willamette University in Salem, Oregon, where he teaches Sports Law.

In the second podcast, we will explore existing legal precedent and ask how those cases and concepts - litigated in the context of other labor battles - inform MLS's bargaining.  This is where we'll get into the arguments the players and owners bring to the table, asking Jeff Maxcy - a sports economist with training in business and labor relations - about the viability of the sides' positions.

Finally, Major League Soccer Talk's own Brian Zygo will join us to synthesize the information.  Brian - sports media member by night but trained lawyer by day - will bring an MLS-expert's perspective to the legalities.

Before we start the interviews, Major League Soccer Talk wants to know which issues peak your curiosity.  Please use the comments section to submit your questions and opinion, which we will comb pre-interview and potentially pass-on to our experts.

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Don Garber will address the "Leaders in Football" conference

Over the next two days, many of soccer’s most influential executives from around the world will meet in London, England for the annual “Leaders in Football” conference. Included in that group are three representatives from the United States: Don Garber, MLS Commissioner and CEO; Sunil Gulati, USSF President; and Tim Leiweke, President and CEO of AEG. Garber joins a panel discussion on managing the wealth gap in professional soccer leagues, while Gulati and Leiweke will be on hand to discuss strategies for weathering the current global economic crisis.

The MLS Commissioner has not released a full account of his speech to the conference, but he did take time to talk with The Associated Press about some of the subjects he plans to address. Garber specifically called attention to revenue sharing, the salary cap, and spending limits dictated by MLS policy that make certain the league’s economic stability. He goes on to conclude that the MLS model ensures “financial fair play” for all member teams.

"We believe to our core that every fan wants to believe that when the season starts they have the tools, the capability, the resources to compete so they can dream about their team winning a championship," Garber said.

He went on to discuss how his single-entity economic model for MLS prevents runaway spending by individual team owners. "As a person who manages a sports league who is very focused on ensuring that we remain financially viable so we remain in business that's not a system that could work here," Garber said. "It would clearly create an arms race of spending that would clearly put MLS out of business as it did with the North American Soccer League in the early 80s."

No one wants to see MLS follow the road of the NASL, but Garber will need to make changes to league policies that currently prevent the growth and limit the fortunes of individual teams. We don’t want to see financial parity in MLS result in mediocrity on the playing field. The “Designated Player” provision of the salary cap is a step in the right direction, as is allowing teams to build stadiums and collect their own revenue. However, there is more that needs to be done now to prevent stagnation of the product, and apathy among its supporters.

Most importantly, MLS needs to give teams more control over their rosters. One change would be to let teams compete for newly signed players to the league through the global transfer process. Let the team negotiate and pay the transfer fee on incoming players, not the MLS front office. Next, introduce free agency with the next MLS Collective Bargaining Agreement, a system that works in other professional sports leagues in the US. Also, mandate an immediate increase in the salary cap for next season and significantly raise – perhaps even double – the minimum player salary from its current $34,000 a year. Players with higher incomes and improved options in free agency become more accountable to the teams and their fans, resulting in an increase in their competitive play. Likewise, these changes in MLS policy will give each team the flexibility to build a roster they feel can best compete for the league championship.

Perhaps for a niche sport in an already crowded American sporting landscape, the conservative approach of MLS over the history of the league has proven acceptable. And in countries struggling to host a professional soccer league that can’t compete with the big leagues of Europe, the lessons learned in the US could translate successfully during economically difficult times. However, for the long term growth of soccer in the United States, MLS will need to loosen up their regulations and give the team owners more control over financial decisions.

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In my last post on MLS' future, I postulated that the television rights deals of the future will determine the level of play we will see on the field. I also stated that it is my belief that MLS must offer a better quality product on the field in order to achieve higher fees. Kind of a chicken or egg dilemna.

A quick review. The major domestic rights deals, with Disney(ABC,ESPN) and Univision, expire in 2014, two World Cups from now. The impact of the success or failure of the US Men's National team is a subject for another post, but it will definitely have an impact on MLS of some sort.

As I mentioned in the last post, the Forbes - September 2008 article on the 2007 season stated that each of the 13 teams received around $800,000, or about 45% of the tv rights in place at the time, around $23M total. Note the domestic rights are down to $21M as the $2M HDNet contract was not renewed after the 2008 season.

So, with $2M less and 2 more teams, the amount teams would receive would drop to around $633,000 if the distribution percentage remains the same.

As a point of reference, using a 45% distribution rate, here are the approximate per team domestic tv rights for the 'Big Four' professional leagues in the US: NFL(53):$43.8M, MLB(40): $14.35M, NBA(15): $14M, NHL(23): $2.57M.(Roster sizes in parentheses)

OK, back to the point in this post. I believe that MLS is currently in an optimal position to improve the on field product. MLS and SUM have come off of a monster cash generating 'Summer of Soccer'. SUM and MLS owners, by virtue of their interest in SUM, also have a fairly steady stream of new franchise fee payments coming in. Now I suspect that some of that money went to reply some of the $350M in losses the league reportedly incurred in its first decade, but I can't be sure of that. Of course, the money hasn't just begun to flow.

But while over half the clubs are expected to lose money this season(and I'm being generous here), that doesn't mean the entities that own the franchises will lose on their investment in professional soccer. Remember, every franchise owner shares in the revenues generated by Soccer United Marketing. And there's nothing to say that those revenues make it onto the club's books. That also goes for the fees generated in team owned stadiums, i.e.; concerts, field rentals, etc.

It is amongst this backdrop that the upcoming Collective Bargaining Agreement(CBA) discussions will transpire. The CBA expires on Jan 31, 2010.

Jason Davis did a fine job doing an early preview of the CBA negotiations back in May and as an old professor of mine once said, 'why reinvent the wheel?'. Below I've posted the most relevant salary sections of the current agreement.

The main section covering salaries in the current CBA:

For each year covered by this Agreement, MLS agrees that the Player
Compensation shall be no less than the following: 

(a) 2005: Player Compensation paid for 2004 plus $200,500.
(b) 2006: Player Compensation paid for 2004 plus $216,500.
(c) 2007: Player Compensation paid for 2004 plus $333,500.
(d) 2008: Player Compensation paid for 2004 plus $511,500.
(e) 2009: Player Compensation paid for 2004 plus $599,500.

Note from Peter C: The 2004 'Player Compensation' was in the neighborhood of $1,730,000. Source: SoccerTimes

Section 10.5
Bonus Pools:  The following Team bonuses will be paid, with the allocation among players on the Team to be determined by the Team’s players: 

(i)  MLS Champion: $165,000
(ii) MLS Runner-Up: $60,000
(iii) Regular Season Conference Champion: $31,000 

(In lieu of, not in addition to, bonus for Qualifying for Playoffs.) 

(iv) Qualifying for Playoffs: $15,000
(v)  U.S. Open Cup Champion: $100,000
     U.S. Open Cup Runner-Up: $50,000 

(U.S. Soccer will pay these bonuses or such other sums, if any, that U.S. Soccer may make available.  If U.S. Soccer does not pay such bonuses, MLS will have no obligation to do so.) 

(vi) Regular-Season Game Winner: $2,750 

        The Union will consult with MLS regarding distribution of the regular-season
        game winner bonus. 

        Notwithstanding the above, in the event of format changes, MLS and the Union shall
        meet and confer concerning amendments to the above bonus schedule.  In no event shall
        the total dollar amount of the bonus pools decrease as a result of format changes (except
        as to those bonuses paid by U.S. Soccer). 

(vii)   Tournaments and Exhibition Games:  If an MLS Team or MLS receives prize
money by virtue of the Team’s performance and/or participation in a compulsory tournament
(i.e., where MLS is required to participate by U.S. Soccer, CONCACAF or FIFA), Players
competing in that tournament will receive the following: 

        (a)      if the Team or MLS receives up to $200,000 in prize money, fifty percent
                   (50%) of such prize money; or 

        (b)      if the Team or MLS receives prize money in excess of $200,000, the
                   Players will receive 50% of the first $200,000 and thirty percent (30%) of
                   amounts over $200,000, up to a maximum payment to the Players
                   (collectively) of $200,000. 

        (c)      With respect to the CONCACAF Champions Cup tournament, the
                   following prize money shall be paid to each team, unless the amount in (a)
                   or (b) above is greater, in which case the amount in (a) or (b) above shall
                   be paid: 

                   Team advances to quarter final: $11,000
                   Team advances to semi-final: $16,500 additional ($27,500 total)
                   Team advances to final: $22,000 additional ($49,500 total)
                   Team wins final: $27,500 additional ($77,000 total). 

                   Notwithstanding the above, in the event of CONCACAF Champions Cup
                   format changes, MLS and the Union shall meet and confer concerning
                   amendments to the above bonus schedule.  In no event shall the potential
                   prize money decrease as a result of such format changes. 

Neither MLS nor any MLS Team shall be required to pay Players a portion of any
compensation MLS or the Team receives in conjunction with participation in
a Non-Compulsory Tournament, but nothing in this CBA shall prohibit MLS or
a Team, in its sole discretion, from voluntarily making payments to Players in
connection with such tournaments.

End of CBA snippets

Want to read the current agreement? The Collective Bargaining Agreement

Interestingly, if I read the salary section correctly, in 2008 18 players counted against the cap, while in 2009 20 players count against the cap. Calculating the caps for 2007-8 at $2,211,500 and $2,299,500, respectively, the average cap room per player actually went down from $122,861 to $114,975.(this excludes those teams that have more than 4 developmental players grandfathered in)

And, again if my calculations are correct, if an MLS team were to win 1) its conference 2) MLS Cup 3) US Open 4) CONCACAF Champions League 5) 16 league games, the players on the team would divvy up a grand total of $343,500. A 24 player split equates to $14,313 to each player.

If anyone out there can correct me on this, by all means, go ahead. If, on the other hand, my calculations are correct, a pretty slick piece of sleight of hand by the league.

==================================

What are the players looking for?

Liz Mullen and Tripp Mickle of SportsBusiness Journal reported that free agency and guaranteed contracts are important issues for the players' union. The current 'Contract Guarantee Date', "the date on or after which a Semi-
Guaranteed Contract may not be terminated"(Article 2 vi) is July 1.

What do I suggest?