Major League Soccer has made a formal proposal to the MLS Players Association regarding salary reductions due to the coronavirus pandemic, with the league now seeking a 20 percent pay cut across the board, sources told ESPN.
The league is also asking the MLSPA to accept additional financial reductions apart from salary cuts that could run into the tens of millions of dollars, according to one source. The sources didn't elaborate on how the league would achieve those savings.
"MLS continues to engage in productive conversations with the MLSPA over ways in which we can collectively address challenges presented by the COVID-19 pandemic," said MLS president and deputy commissioner Mark Abbott.
The MLSPA did not immediately respond to a request for comment.
MLS suspended play on March 12 and at the time instituted a training moratorium as well. But this past week, some clubs began having their players engage in individual workouts at team facilities, with stringent controls in place to ensure that they didn't contract COVID-19.
The league-wide shutdown has led MLS to engage in discussions with the MLSPA about wage cuts. Three weeks ago MLS floated the idea of a 50 percent cut as it pertained to the entire 2020 player payroll, with players making under $100,000 not affected. With players continuing to earn their full salaries that scenario would have seen some pay check reductions exceeding 75 percent.
MLS delivered a formal proposal to the MLSPA on Friday. While it offers a far lower pay cut in terms of percentage, one critical difference in the current offer is that the pay cuts would be across the board, with no consideration made for players on the lower end of the pay scale.
How much the players' paychecks would be affected going forward depends on when the cuts would be instituted. If the cuts go into effect on July 1 -- a point at which the players would have already received half of their 2020 salaries -- and assuming a total league-wide payroll of $310 million, MLS would end up cutting its player payroll costs by around $31 million. That is not the extent of the financial impact, with the additional concessions set to further impact the players.
The talks come amid an awkward labor situation for both sides. The league and the MLSPA agreed to a framework for a new Collective Bargaining Agreement (CBA) back in February, but due in part to the ongoing pandemic the agreement was never ratified by either side. Critically, neither the new nor the old CBA contained a force majeure clause that would allow the league to unilaterally institute wage cuts in the case of a catastrophic event like a pandemic. This left the players with some leverage.
The league continues to discuss return-to-play scenarios with the MLSPA, though the situation remains fluid. Garber told ESPN television analyst Taylor Twellman last month that the league was considering a tournament format and neutral locations when the league returns, and that approach is gaining some momentum given that, at least initially, games will likely be played without fans.
One possibility under discussion is to hold a mini-tournament in Orlando and possibly one other MLS city, whereby teams would be divided into four groups and the top teams would then advance to a knockout stage.
MLS wants the matches to count in the league standings, requiring "consolation games" to make sure teams played the same number of matches. Another aspect of the plan being discussed is that the winner of the competition would earn a spot in the CONCACAF Champions League, replacing the winner of the U.S. Open Cup, which is in danger of not being held this year.
All teams would be quarantined and tested regularly and always on matchdays and the competition would conclude by the start of September. That opens up the possibility that the players would be required to be away from their families for an extended period, which is bound to garner some pushback from the MLSPA.
The Athletic was among the first to report the possibility of Orlando, Dallas and Kansas City as possible locations.
The hope is that by the time the tournament ends, the impact of the pandemic will have eased to the point where teams can return to their home markets and the season can resume.