Panel finds in favour of PFA and rules English League One and Two salary caps ‘unlawful’

February 10 – Salary caps for players in England’s League One and League Two, representing the third and fourth tiers of English football, have been scrapped following a decision by an independent arbitration panel – just eight months after they were introduced.

The panel upheld a claim by the Professional Footballers’ Association that the caps, voted on by the clubs themselves, were “unlawful and unenforceable”, a ruling that could have significant repercussions in terms of clubs living within their means.

League One clubs had agreed to cap total expenditure on player salaries at £2.5 million while those in League Two agreed to a ceiling of £1.5 million.

Wages, bonuses, taxes and image rights, plus agents’ and other relevant fees, were to have been included within the cap but the move was challenged by the players’ union.

“Like everyone involved in football, the PFA wants to see sustainable clubs at all levels. We also recognise the huge economic pressure that clubs have come under due to the Covid-19 crisis,” the PFA said in a statement.

“The PFA believes it is now in the best interest of the leagues, the clubs, and the players to work together and agree on rules that promote financial stability.”

A number of EFL clubs have faced enormous financial difficulties during the COVID-19 pandemic and speaking following last August’s vote,  EFL chief executive David Baldwin stressed a cap was the best way forward to keep clubs financially viable.

“The term ‘salary cap’ is an emotive one, creating the impression of a restrictive measure but we are clear in our view that this is neither the objective nor the likely effect of these changes to EFL regulations,” he said at the time, adding the measure was intended to “help ensure clubs cannot extend themselves to the point that could cause financial instability”.

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