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Official website: ‘Squad salary caps’ introduced in League One and League Two


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Ok, this is pretty big.

Key bits

1. When calculating total salary spending, the ‘cap’ includes:

 

  • Basic Wages;
  • Taxes;
  • Bonuses;
  • Image rights;
  • Agents’ fees and;
  • Other fees and expenses paid directly or indirectly to all registered players

2. "of League One and League Two Clubs opting to implement the new measures in place of the existing Salary Cost Management Protocols (SCMP), with fixed caps of £2.5million and £1.5million respectively."

3. Payments directly linked to a Club’s progression in cup competitions or promotion are excluded from the Cap, while any income generated from players going out on loan is deducted from the Club’s Salary Cap calculation.

4.  Moving forwards, Clubs that are relegated will be permitted to cap all contracts at the divisional average prior to the Club’s relegation until those contracts expire. 

5. An ‘overrun’ concept is also included if a Club’s total squad salary payments exceed the Cap by up to 5%, whereby dependent on the percentage level of the overrun, a financial penalty would be payable for every £1 in excess. 

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On the relegation bit - if a club comes down from the Championship to League 1, any players who are under contract will contribute to the wage cap only to the extent of the League 1 average salary, until their contract is up?

And same for League 2?

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11 minutes ago, Joe B said:

Ok, this is pretty big.

Key bits

1. When calculating total salary spending, the ‘cap’ includes:

 

  • Basic Wages;
  • Taxes;
  • Bonuses;
  • Image rights;
  • Agents’ fees and;
  • Other fees and expenses paid directly or indirectly to all registered players

2. "of League One and League Two Clubs opting to implement the new measures in place of the existing Salary Cost Management Protocols (SCMP), with fixed caps of £2.5million and £1.5million respectively."

3. Payments directly linked to a Club’s progression in cup competitions or promotion are excluded from the Cap, while any income generated from players going out on loan is deducted from the Club’s Salary Cap calculation.

4.  Moving forwards, Clubs that are relegated will be permitted to cap all contracts at the divisional average prior to the Club’s relegation until those contracts expire. 

5. An ‘overrun’ concept is also included if a Club’s total squad salary payments exceed the Cap by up to 5%, whereby dependent on the percentage level of the overrun, a financial penalty would be payable for every £1 in excess. 

Point 5 is interesting... If its JUST financial penalties they could Salford just break the cap and pay the fine? Im guessing that points would start to be introduced for repeat offenders.

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Just now, Iron Curtain said:

Point 5 is interesting... If its JUST financial penalties they could Salford just break the cap and pay the fine? Im guessing that points would start to be introduced for repeat offenders.

Only by 5% though. 

If they go over 5%: 

Clubs exceeding the ‘overrun’ would be referred to an Independent Disciplinary Commission, although the EFL will monitor the Cap on a real-time basis throughout the season as is the current position with SCMP measures across the two divisions.  Where breaches do occur, sanction guidelines are in place to be considered as appropriate by an independent Disciplinary Commission.

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I see the PFA are up in arms about this and suggesting it is unlawful and unenforceable.  A possible legal challenge??

Will it also lead to the sort of cash in the boots payments that went on when the maximum wage was in place??  Or will we see some Vale players having part time "jobs" at Synectics?!!!

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25 minutes ago, Jacko51 said:

I see the PFA are up in arms about this and suggesting it is unlawful and unenforceable.  A possible legal challenge??

Will it also lead to the sort of cash in the boots payments that went on when the maximum wage was in place??  Or will we see some Vale players having part time "jobs" at Synectics?!!!

I think any fees/expenses paid to registered players will have to be declared.

The 'Independent Disciplinary Commission' is key. If they're hot on and impose solid sanctions then hopefully the trickery won't be common.

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33 minutes ago, Jacko51 said:

I see the PFA are up in arms about this and suggesting it is unlawful and unenforceable.  A possible legal challenge??

I was just about to ask this question. Is this even allowed these days? Could salary caps be introduced into any other industry and be enforced? 

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54 minutes ago, ginginator said:

Seems that way, but the divisonal average will be higher than the one below. So its like having a parachute payment system.

Not quite it just allows the club to spend more of their own money than they would otherwise be allowed to.

46 minutes ago, ginginator said:

If the Championship vote against this it will be massive. The difference between Lg1/2 to Championship will be like Championship to PL. Not a great idea in my opinion.

Percentage difference in wages is greater between L1 and The Championship already. Not sure it will change that much.

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2 minutes ago, Andyregs said:

I was just about to ask this question. Is this even allowed these days? Could salary caps be introduced into any other industry and be enforced? 

Rugby has had it for a number of years. 

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3 minutes ago, JRC said:

Rugby has had it for a number of years. 

Has anyone contested it? We didn’t have the Bosman ruling until he contested it. I’m not A lawyer so just wondering out loud.

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3 minutes ago, Jacko51 said:

I believe Sunderland’s wage bill last year was £13 million. Getting it down to £2.5 mill will be a job. 

Imagine a "big club" getting relegated twice from PL then Championship, then getting stuck in League 1 🙂, for 2 seasons.  Some clubs may even make a profit though.

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24 minutes ago, Andyregs said:

I was just about to ask this question. Is this even allowed these days? Could salary caps be introduced into any other industry and be enforced? 

My guess is it cant be challenged as it doesn't say "You cant pay a player more than X"... it says that a club will have to pay a penalty and be punished if their total salary goes too high. So a player technically isnt limited... strange notion though, and Im no lawyer.

The fact that its been around in Rugby for ages means their is precedent.

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