Are salary caps and contract trades in football the way of the future?
By Cameron Wolfe
I read an article years ago which compared football transfers with transfers in North American sports ( NFL, NHL, baseball etc) and in which the question was posed: Would an alternative transfer approach work here in football?
The fundamental answer was no. In football players are bought and sold just like in the commodities in the markets. They become an asset to the club until they are sold on at either a profit or in some cases a loss.
Most clubs are hoping that they’ll profit from the sale or at least recoup some of the wages paid to that player during the length of their contract. Or, in the case of players who have been put on extravagant wages, they’re glad to take a hit and have that players wages of their books. (Adebeyor is a perfect example)
In North America players are traded not bought, which means in fact that the contracts are exchanged with wages negotiated at the start of the contract.
Now there is a fundamental difference between a player being bought and traded. In football money is paid to the club for the player. He then belongs to that club for the duration of their contract. If the club want him to leave or the player wants to move to another club, the next club again buys him.
Not so in the NFL. Here a player has a contract with his individual team, but the terms of the contract are binding for any other team seeking his services. So if a player is traded to a new team, his contract goes with him.
For example, if he has a contract for 4 years at £8m per year then his current contract carries on being his contract at the new club. No fee is paid to the team or the player.
But in football, the club of the current player sets a fee that they’d like for the player. The buying club then either meets the valuation or they negotiate until both sides are happy(ish) with the figure. The buying club then pays the club a fee for the player.
In football the argument is always that some of the lower league clubs could fold if they didn’t receive the money from transfers and that is why it is important that money from the sales of players still filters down. Some lower league clubs really do solely rely on that income to survive as they don’t get a big enough crowd through the door to pay the salary.
So buying and selling players looks like it will continue in football for a long time to come but what about salary caps? Could they work in football?
Salary caps could work if all clubs agreed to only spend 50% of their revenue on wages (or less) and stick to that. The top clubs would all be basically paying the same wages for the top players. The players being courted by the clubs would then have the choice of which club they really wanted to join as opposed to which club were paying the most money.
In North America where I do think they have it right is with young players. They’re not offered multi million dollar contracts at nineteen but rather they’re offered entry contracts. Currently in the NHL an entry contract is $900,000 (something around £10,000 a week). The thinking is that it keeps the teenager grounded for the first few years in his professional career. It’s capped again between 21-23. It then moves on to a more lucrative contract as the player matures.
For the top players in the NHL if they have a $15m three year contract they would receive $15m over three years. They are not allowed to earn more than what their contract states:
For example, a player signs a three-year contract with the following annual salaries:
– Year One: $7 million
– Year Two: $5 million
– Year Three: $3 million
Where this is beneficial to the Clubs is when the player is coming to the end of his current contract or even the end of his playing career at the Club. They’re paying smaller wages to the player in the final year of the contract.
If he starts of his career performing at the level that the manager thought he would, then he’s earning his premium wage. Towards the end of his contract if he isn’t performing to his highest level or his performances are tailing of then at least the Club isn’t still paying top wages in the last year of the contract for the player.
I think that in football the way to make it fairer for all would be to set at maximum amount to be spent on player’s wages per year. The clubs could still attract whichever player they wanted but spending more wages on one player would leave less to spend on the rest of the team. We all know that most EPL teams need a large squad to get through the season. Spending the same amount of money on wages whilst still staying within the parameters of their wage structure (if they have any in place) can only benefit all the clubs in the long run.
I am not saying that this is the answer to the entire wage and transfer issues but I can see the current wages and transfer fees continuing to spiral upwards indefinitely unless something happens to change it.
And it is interesting to note that the Premier club chairmen have discussed the issue at regional meetings, and it is set to be top of the agenda at a meeting scheduled for September 7.
Currently, Manchester City are not convinced about the plans particularly about the potential for hard-hitting sanctions but other top clubs, such as Chelsea and Manchester United, are behind these ideas.
Footballers’ salaries have increased by 1,508% since the Premier League started in 1992. Compared to a rise of just 186% among the general public. Approximately. 75% of the club expenditure are wages alone compared to less than 50% 15 years ago
Man City’s last wage bill was 173% of turnover.
Queens Park Rangers’ current wage bill is 183% of turnover.
In Spain the two top teams have the highest paid players in the world.
- Messi: £27m
- Ronaldo: £24m
While we have:
- Rooney: £17m
- Aguero: £16m
- Ya Ya Toure: £15m
- Torres: £14m
Looking at the names and how much they earn per year, maybe it is time to look at wage caps!
Our Woolwich Arsenal book nominated for an award
- Numbered shirts were introduced by Chapman, or were they?
- Consider the midfield
- Ref Review: Michael Oliver; excellent but an occasional bias
- Me and Sammy Nelson
- We need two refs and two extra linesman – plus technology
- The referee review you simply won’t believe
- Why we need an extra ref and two more linesmen in each game
- Ray Parlour and Martin Keown back playing this weekend.
- Why bother with internationals, when countries can own clubs?
- Arsenal v Leicester: comparing the form, and the goalscorers
- Arsenal v Leicester: how will the ref handle Leicester’s mulitple tackling?
- What sort of referee is Darren England? The statistics reveal some odd facts.
- Premier League 2022/23 – Matchweek 2 Refereeing matters
- Are we all really sure that no other club behaves like Barcelona?