League One & League Two Clubs Vote in Favour of Landmark Salary Cap

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League One and League Two clubs have agreed a salary cap | Catherine Ivill/Getty Images

Clubs in both League One and League Two have voted in favour of introducing a salary cap, with the new limits to come into effect immediately.

The new regulations will see clubs fined, or face further sanctions, if they do not adhere to the spending limits, which are now set at £2.5m for League Two and £1.5m for League One.

This landmark ruling will also impact wages, bonuses or any other fees for players aged 21 and over, although any income gained from achieving promotion or extended cup runs will be exempt.

A statement from the official English Football League said: "The decision follows extensive and comprehensive consultation with all clubs in respect of addressing sustainability and wage inflation issues across the EFL, which were initiated prior to the suspension of football in March following the Covid-19 outbreak and have continued during the course of the summer.

"Those discussions culminated in today's divisional vote, with representatives of League One and League Two clubs opting to implement the new measures in place of the existing Salary Cost Management Protocols (SCMP)."

Further included in the statement is a mention that clubs in the third and fourth tiers are discussing 'additional measures aimed at addressing club financial sustainability, while in the Championship there are also talks taking place regarding their own 'financial controls'.

Chief executive David Baldwin added: "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.

"The financial impact of Covid-19 will be profound for EFL clubs and today's vote will help ensure clubs cannot extend themselves to the point that could cause financial instability.

"Over the last two weeks the discussions amongst clubs in both Leagues One and Two have been healthy and constructive, allowing us to reach a clear consensus and I am pleased that the clubs have determined to adopt the new approach. We will now work with all clubs, the PFA and, where appropriate, other stakeholders to implement the new rules and continue our efforts to bring long-term sustainability to the EFL."

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