Wednesday, December 16, 2015

MLS Begins Era of Free(er) Agency

After taking a long firm stance against free agency, has MLS finally caved and given the players what they've been fighting for?  Sort of.  Although the players who qualify for free agency are indeed free to sign a contract with any team, the league has placed strict limits on the amount a player's salary may increase.  In other leagues such as Major League Baseball, players who reach free agency can see their salaries more than double for an annual increase in the millions.  This is exactly what MLS wants to avoid.

Expensive Pennies

According to the MLS Players' Union press release in July, the most a player's salary can increase is 25% and only if he was earning less than $100,000.  The limit on the increase drops to 20% if the player makes $100,000 or more and 15% if he makes $200,000 or more.  A note below this information reads, "The above percentage increases may be raised for players who significantly outperform their contracts".  But exactly how one goes about outperforming his contract is not explicitly spelled out.  To be eligible for free agency, a player must be out of contract, at least 28 years old, have at least 8 years of MLS experience, and be paid less than the league maximum (currently $436,250).

I'm hoping the wording in the union's press relesase is poorly chosen and that the percent caps on salary increase are actually on a sliding scale.  Otherwise, a player like Chad Barrett listed below makes a penny too much at exactly $100,000.  At that salary, if Chad were eligible for free agency, he could only negotiate a salary of $100,000*1.2  = $120,000.  However, if he made a penny less, he could negotiate a 25% increase in salary, $99,999.99*1.25 = $124,999.99. That last last penny could potentially be costing him $4,999.99!  The drop in max salary is even worse for someone like Bobby Boswell who made exactly $200,000.  He can negotiate for a salary up to $200,000*1.15 = $230,000 but if he made only a penny less, could negotiate up to $199,999.99*1.2 = $239,999.99 or $9,999.99 more! Again, since the collective bargaining agreement is not yet posted on the players' union site, we cannot be 100% certain that this is how the system works but according to the union's press release, these odd drops exist.

Interesting Incentives

Assuming the situation is exactly as laid out in the players' union press release, there are some interesting incentives introduced with this flavor of free agency.  There are seemingly two salary ranges where a player could potentially negotiate a higher salary in the future if he were actually paid less in the current season; the ranges $96,000 to $99,999 and $191,667 to $199,999  shown below.


Consider a soon-to-be free agent whose salary is just below either cutoff shown above.  His team has an incentive to increase his current salary past the cutoff point.  Doing so would give the team more bargaining power later as potential suitors would not be able to increase the player's salary as much.  It may also save the team considerable money in the future if they retain the free agent.

Free Agents, Potential Free Agents, and Mike Magee

According to mlssoccer.com, there are 27 players listed as potential free agents.  However, there are many more who satisfy the age, MLS experience, and salary restrictions.  Since contract information is not publicly available, I assume those that weren't listed as free agents are currently under contract.  Since soccer contracts are usually not many years long, it is likely that these players can be free agents relatively soon.  Below is the list of potential free agents I've compiled from MLS player data from mlssoccer.com (which removed all but 2 of the players on the free agent list from the stats page!) and the 2015 salaries according to the players' union along with some notes.  MLS announced free agents are in bold at the top.  Potential free agents (conditional on being out of contract) are below and not in bold.


teamplayerageseasonguaranteed_salarymax_potential_salary2016 FA
CHIJeff Larentowicz3211271,000311,650signed LA
CHIJon Busch31990,000112,500(NASL-IND)
CHITy Harden31875,07893,848FA
COLBobby Burling319140,000168,000FA
COLDrew Moor3111270,500311,075signed TOR
COLJames Riley331183,750104,688FA
COLMichael Harrington299130,000156,000signed CHI
COLNick LaBrocca319180,000216,000FA
FCDStephen Keel321160,00075,000FA
HOUNathan Sturgis281075,37594,219FA
HOURicardo Clark3211337,750388,413resigned HOU
LAAlan Gordon3411175,000210,000signed LA
LAEdson Buddle3414106,250127,500FA
MTLKenny Cooper319285,625328,469FA
NYCFCNed Grabavoy3212215,000247,250signed POR
NYRBKyle Reynish32890,317112,896FA
ORLCorey Ashe299189,750227,700signed CLB
ORLEric Avila28877,00096,250(MX -Santos)
PHIBrian Carroll3413150,000180,000signed PHI
PHIConor Casey349180,000216,000signed CLB
PORAndrew Weber321160,00075,000FA
SEAChad Barrett3011100,000120,000signed SJ
SEATroy Perkins3410136,663163,995retired
SJKhari Stephenson34871,64689,557FA
SKCPaulo Nagamura3211230,000264,500signed SKC
MTLJustin Mapp3115199,225239,070signed SKC
CHIPatrick Nyarko298215,750248,113
CLBTyson Wahl311199,667124,583
COLMarc Burch3111110,000132,000
COLSam Cronin298202,500232,875
DCBobby Boswell3211200,000230,000
DCChris Rolfe3210225,000258,750
DCDavy Arnaud3514212,500244,375
DCFabian Espindola309175,000210,000
DCSean Franklin308234,167269,292
FCDAtiba Harris3011130,000156,000
FCDChris Seitz289130,000156,000
HOUDavid Horst30881,500101,875
LADan Gargan3312125,000150,000
LADan Kennedy338233,000267,950
LARobbie Rogers288191,667230,000
MTLDominic Oduro3013251,667289,417
MTLEric Kronberg3210132,000158,400
NEBrad Knighton30882,005102,506
NEChris Tierney298113,333136,000
NYCFCChris Wingert3313215,000247,250
NYCFCJason Hernandez3211185,000222,000
NYCFCJosh Saunders341090,000112,500
NYCFCMehdi Ballouchy321383,250104,063
NYRBDax McCarty2811262,500301,875
PHISebastien Le Toux318285,228328,012
PORJack Jewsbury3413137,500165,000
PORNat Borchers3411245,000281,750
PORWill Johnson289334,333384,483
RSLJamison Olave348300,000345,000
RSLJavier Morales359300,000345,000
RSLNick Rimando3616370,000425,500
RSLTony Beltran288205,950236,843
SEABrad Evans309302,666348,066
SEAChad Marshall3112291,667335,417
SJMarvell Wynne2911200,625230,719
SJQuincy Amarikwa2810100,000120,000
SJShea Salinas298148,333178,000
SJSteven Lenhart298159,083190,900
SKCChance Myers288195,000234,000
SKCJacob Peterson2911130,375156,450
TORHerculez Gomez338261,000300,150
VANJordan Harvey3111150,000180,000
 
You may notice that I left off Mike Magee. Although he's included on mlssoccer.com's list, his guaranteed salary was above the maximum so according to the rules listed on the players' union website, he's not eligible.  EDIT: and yet he was just announced as a free agent signing with LA!  MLS isn't known for following it's own rules but there may be an explanation for this.  It may be that allocation money was used to "pay down" what Magee's salary was considered to be on paper to bring him below the limit.  I'll look into this hypothesis.

It'll be very interesting to see where the first free agents go.  The literature on free agency predicts they should be more likely to go to teams in bigger cities where their financial impact is larger, teams on the verge of playoffs or Champions' League where their productivity could bump the team into that pool of revenue, and/or more amenable locations.



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