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NWSL announces major changes to player compensation

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All that owner negotiation has produced a result. Teams can now spend up to $300,000 on salaries over the cap or external transfer fees

Paulson: are you not entertained
Bennett Dewan

The NWSL announced the rumored changes to their compensation guidelines in a post on the league website today, and they’re every bit as big as promised.

The headline takeaway is a $300,000 allowance in allocation money that can be purchased by any team directly from the league. This can be used for two primary things: buying down player salaries that exceed the salary cap that year or paying transfer fees for overseas players. Transfer fees in women’s soccer worldwide have historically been extremely low, with the total cost of transfer fees in the world totaling only $564,354 in 2018, so this potentially adds a massive influx of cash to the global market for women’s soccer, even assuming that teams only use a small portion of their allocation money for external transfers.

Contracts eligible for allocation money buy downs are restricted by a set of criteria that are pretty broad but have some odd exceptions. Allocation eligible players include:

NWSL Best XI or Second XI for either of the two most recent seasons (2019, 2018)

International players who have more than three caps for their national team in the prior 24 months

NWSL MVP, Golden Boot, Rookie of the Year or Defender of the Year winner for one of the two most recent seasons (2019, 2018)

Domestic players who have completed at least five seasons in the NWSL

Players who were formerly designated as allocated players by the U.S. or Canada (unless if the player refused the option to be allocated)

Players previously on a contract that included allocation money

Notably, Ada Hegerberg wouldn’t be eligible under the current rules. Allocation money also can’t be applied to USWNT or Canadian WNT players.

The Equalizer suggests that the allocation money is going to be tradeable within the NWSL as well, setting up a number of possibilities for teams. It’s fairly clear that there haven’t been adequate trade assets in the league to make certain deals work in the past, giving a massive amount of leverage to teams who can simply sit on a players contract until both sides get so incredibly unhappy with the situation that, for instance, a player will leave for Sweden, which not all players will have the ability or desire to do. Ideally adding tradeable allocation money, more teams will be able to convince recalcitrant teams to do a deal.

Although most of the rule changes are targeted at raising the top end of the compensation structure, there are some important changes for players at the other end: minimum salaries have been increased to $20,000 a year (up from $16,538/yr in 2019) and there is no longer a cap on the permitted expenses for player home and auto assistance. Providing housing is already a big part of the NWSL salaries and the quality of that housing now is potentially a major draw when teams are trying to convince players to sign. Cars provided to players must now be provided year-round.

Portland is well placed to take advantage of the new rules, both because of the resources it’s willing to commit to the team and the internal staff resources they have in understanding how MLS-style rules can be applied. There is an argument to be had over whether moving in an MLS-esque direction is the best for the NWSL, but it’s clearly one that most owners were comfortable with and doesn’t rock their boats too hard. Nonetheless it’s a massive overhaul to how the league pays it’s players and potentially sets up a significant influx of talent this offseason, if teams can figure out how this all works in time.