NWSL's Game-Changing Settlement: High Impact Player Rule Reimagined
In a groundbreaking move, the NWSL has decided to lift the restrictions around the High Impact Player (HIP) rule, now making it possible for any player to compete for the league's top salaries.
Originally implemented last December, the HIP rule allowed teams to exceed the salary cap by an additional $1 million to secure star talent. However, players needed to meet one of eight stringent criteria to qualify, which included national team appearances, honors like Ballon d’Or recognition, and being featured on marketability lists.
The NWSL Players Association wasn’t having it. They filed a grievance, claiming that these classifications violated federal labor laws and the collective bargaining agreement. At the time, around 100 players, including Trinity Rodman and Sophia Wilson, met the criteria, but notable stars like Sam Kerr and Catarina Macario were left out.
With the recent settlement announced on Friday, all those eligibility restrictions have been abolished. Starting January 1, 2027, teams can label any player as a High Impact Player, provided their salary is at least 12% of the base salary cap. The league also has the option to impose a cap on the number of HIP players each club can have.
In total, six grievances were resolved, including one related to the Washington Spirit's contract offer to Rodman, which was previously rejected. Additionally, the controversial footwear policy, which limited players’ choices in shoe brands during matches, has been addressed.
“This settlement showcases the strength and commitment of the NWSLPA to uphold the Collective Bargaining Agreement,” said Meghann Burke, executive director of the Players Association, in an interview with ESPN.
NWSL executive vice-president Bill Ordower acknowledged that disagreements are part of a mature labor relationship, especially in a rapidly evolving league like the NWSL. He emphasized that this agreement fosters clarity and stability for players, clubs, and the league, while maintaining competitive integrity.
The HIP rule was introduced to help teams retain their star players amid a surge of talent heading to Europe, where salary caps don’t exist. It was informally dubbed the “Rodman Rule” due to the timing of its rollout, which coincided with Rodman’s drawn-out contract negotiations.
Rodman had been enticed by lucrative offers from European clubs that the Spirit couldn't match under the existing salary cap. When the Spirit sought to re-sign her for a deal averaging over $1 million annually, NWSL commissioner Jessica Berman blocked the offer, citing a violation of league rules. The Players Association subsequently filed a grievance, labeling the move a serious infringement on player free agency rights.
Following the introduction of the HIP rule, Rodman signed a record deal with the Spirit in January worth over $2 million per year. The grievance concerning her initial contract refusal remained unresolved even after she re-signed. While teams aren't obligated to announce players signed under the HIP designation, several have since brought in or retained eligible players like Lindsey Heaps, Barbra Banda, and Rose Lavelle.
Though the league retains the right to reject contracts that attempt to circumvent salary cap rules, they must now notify the union of any decisions and provide explanations within 72 hours. Furthermore, the league is required to update clubs on salary cap and revenue matters throughout the year.
The settlement also put an end to the footwear policy that had led to warnings and fines for players wearing non-sponsored brands. Now, most players' existing endorsement deals will be recognized, and fines will be rescinded.
