Major League Soccer (MLS) has very strict rules on the money each club can spend on the salaries of players. Unlike in the English Premier League or the Spanish La Liga where club sides can decide how much they offer each player for salaries. This often leads to cases like that of FC Barcelona where they are now in debt of 1.3bn Euros. To prevent this, and many other things, the MLS devised the Salary Cap and the Roster Rules for the MLS clubs.
How does the MLS Salary Cap work?
Under the MLS Salary Cap rules, every club is eligible to register 30 players on its active roster divided into separate rosters like the Senior Roster, the Supplemental Roster, and the Homegrown Roster. Players are also classified as either Domestic, International, Generation Adidas, Designated Player, Young Designated Player, and Special Discovery Players.
On the Senior Roster budget, every MLS Club can not spend more than $4.9m in salaries for a year and the maximum salary budget charge for a player on the Senior roster is $612,500. The players on the homegrown or supplemental rosters are to earn an aggregate of $125,000 each year above the Reserve Minimum Salary of $63,547 or the Senior Minimum Salary of $81,375.
Why does the MLS implement a salary cap?
The Major League Soccer (MLS) board implements a Salary Cap and a Salary budget on all MLS clubs so that the clubs can all be competitive. The salary cap ensures that no club is spending exorbitant fees on players salaries that other clubs can not afford, as is the case in Europe with Paris Saint-Germain, Chelsea, Manchester City, FC Barcelona etc. This means that all MLS clubs spend the same salary despite their franchises resources or owners wealth.
Also, another reason the MLS Board enforces the Salary Cap is to make sure each MLS Club has equal talents with the other clubs. This can be seen in the balance of strikers in the MLS such as Carlos Vela, Javier Chicharito Hernandes and Gonzalo Higuain in different teams of Los Angeles FC and Inter Miami. The Salary Cap in the MLS ensures that all MLS Club remains competitive and equal to each other.