Major League Soccer and the Major League Soccer Players Association (MLSPA) have announced they’ve reached an agreement in principle on the terms of a new collective bargaining agreement (CBA) which covers five full seasons from 2020 to 2024 (term runs from Feb. 1, 2020 through Jan. 31, 2025).

The deal is subject to formal approval by the MLS Board of Governors and the MLSPA membership.

“As we prepare to celebrate our 25th season, we are very pleased to finalize a new five-year Collective Bargaining Agreement with our players,” MLS Commissioner Don Garber said in a league statement. “This agreement addresses key strategic priorities for the league and our players while also retaining the basic player compensation structure that has been the foundation for the growth and stability of Major League Soccer. We had constructive, positive discussions with the leadership of the MLSPA and the players’ bargaining committee during the negotiations over the last few months and I would like to thank them for their collaboration in concluding an agreement that will serve as the foundation for a new era of partnership with our players.”

Added Jeff Larentowicz, MLSPA Executive Board Member, in a release from the Players Association: “This deal is the culmination of our efforts to engage players from every team to define our goals and push for real progress. Through this work and our solidarity, we have been able to reach an agreement that will provide players with greater rights and increased compensation, and will ensure that the league’s resources continue to be used to create a league of choice for players both on and off the field.”

The agreement, which comes 24 days before the start of the new 2020 season includes:

Increased investment in player spending

MLS will increase investment in the (a) salary budget, (b) General Allocation Money and (c) performance bonuses for players, raising the spending power per club every year, from $8,490,000 in 2019 to $11,643,000 in 2024. In addition, the minimum annual salary for senior roster players will increase each season to $109,200 in 2024 and 401(k) contribution and other benefits will also increase with the new CBA.

Greater salary budget flexibility across rosters

During the last three MLS seasons (2017-2019), clubs were provided an additional $1.2 million per season in Targeted Allocation Money (TAM) to be used for the acquisition or retention of players within a specific salary budget range. Under the new CBA, that $1.2 million per season has been converted to General Allocation Money and may be used across the entire roster. Additionally, as the amount of guaranteed spending across the entire roster increases over each of the next five seasons, the amount of Discretionary Targeted Allocation Money per season will decrease accordingly.

Here are all the details on how the increased spending will break down.

Players to share in media revenue

For the first time, player spend per club will include a share of the increased revenue generated by MLS’s new media agreements in 2023 and 2024. Beginning in 2023 and 2024, MLS will increase player spending by an amount equal to 25 percent of the increased media revenue above the amount generated by the league in 2022 plus $100 million. The league’s current local, national and international media rights partnerships expire at the end of 2022.

Increase in charter flights

Clubs will be required to use charter flights for eight legs of travel during the 2020 regular season, growing to 16 legs for the 2024 season. In the previous CBA, clubs had the discretion but not the requirement to charter up to four legs per season. In addition, clubs will be required to use charter air travel for all Audi MLS Cup Playoff matches and Concacaf Champions League games involving international travel.

Expanded free agency

The eligibility criteria for free agency has been expanded to include players who are 24 years or older and have five years of service in MLS. This lowers the age and term from the previous CBA (28 years old with eight years of service). The CBA also includes caps on the increases in compensation in free agent contracts. In addition, players making above the maximum salary budget, including Designated Players, will now also be eligible for free agency based on specific guidelines.

Here are all the details on the new terms of free agency.

New “Under-22” Player initiative

Beginning in 2021, MLS will have the discretion to allow clubs to sign up to three players who are 22 years old or younger on a reduced charge to a club's salary budget. More details regarding the new initiative will be provided at a later date.

Designated Player spots

Clubs will continue to have the right to sign up to three Designated Players in the new CBA. The league will have the right to limit the compensation for the third Designated Player to the maximum TAM Salary, unless the player is 23 years old or younger, in which case there will be no limit.