History of Compensation: European Leagues and American Soccer

Compensation Data Facts - What's What in Compensation

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History of compensation... The most notable difference between European soccer leagues and United States professional sports associations (with the exception of Major League Baseball) is the existence of salary caps in America. These restrict the amount of money that a team can spend on players salaries and exists as a per-player limit or a total limit for the team's roster, or both.

No salary caps have been imposed in the major European soccer leagues so its no surprise that Cristiano Ronaldo (Real Madrid) and Lionel Messi (Barcelona) are the highest paid footballers - and professional athletes - in the world with earnings of $88 million (£79 million) and $81.4 million (£73 million) respectively. But both players also have unique contracts with their clubs where they negotiated weekly salaries after taxes. Ronaldo's salary earns him $321,000 (£288,000) per week after taxes, a cost of about $641,000 (£575,000) per week to Real Madrid considering the tax his team has to pay on his salary is around 52% in Spain.

In stark contrast, MLS (Major League Soccer) player Ricardo Kaká, who after signing with the Orlando City SC became the highest-paid player in U.S. soccer history, currently earns with a base salary of $6.6 million with a guaranteed compensation of $7.2 million per year.



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