The NWSL and NWSL Players Association have agreed to settle several long-standing grievances, including removing restrictive qualifications from the High Impact Player rule to allow any player to earn the league's highest possible salaries.
Beginning Jan. 1, 2027, all players are eligible to be designated as High Impact Players (HIP) as long as long as their salary equals 12% of the base salary cap. That opens the possibility of seven-figure salaries to any player who signs in the NWSL, rather than the roughly 100 who qualified based on the league's previous guidelines.
The change comes following the settlement of grievances between the league and the NWSL Players Association, including a separate one around the league's rejection of a contract proposal last year between the Washington Spirit and star forward Trinity Rodman. The settlement requires greater financial transparency from the league to the union, as well as annual salary cap projections that did not previously exist.
A grievance around the league's new footwear deal was also settled to honor preexisting deals and withdraw previously issued fines.
"This settlement is certainly evidence of the NWSLPA's strength and commitment to enforcing the terms of the Collective Bargaining Agreement," NWSLPA executive director Meghann Burke told ESPN in a statement about the HIP rule.
"We have conviction that what is good for Players is good for the game, and good for the League. Repealing League-imposed criteria that determined eligibility for HIP funds is a positive result for Teams, NWSL, and Players."
NWSL executive vice president Bill Ordower said in a statement issued to ESPN: "Disagreements are a natural part of any mature labor relationship, particularly in a league that is growing and evolving as quickly as ours. What matters is how you work through them. This agreement gives the players, clubs and league greater clarity and certainty moving forward, while protecting the integrity and competitive balance that is fundamental to the NWSL."
The original version of the HIP rule was ratified by the NWSL Board of Governors last December and allowed teams to spend an additional $1 million above the salary cap -- $4.7 million total in 2026 -- to attract and retain star players, but the rule came with complicated stipulations.
Players had to meet one of eight different criteria ranging from year-end NWSL Best XI honors to selection on lists of top players as voted on by media (including ESPN FC Top 50).
One of those lists was a media list ranking athlete marketability.
The NWSLPA opposed the rule and proposed that the league should raise the salary cap by $1 million. The NWSLPA quickly filed a grievance arguing that the classification of players violated federal labor law and the collective bargaining agreement.
But the league moved forward with the rule, arguing that its CBA with the union says that the NWSL "may in its discretion, after consultation with the NWSLPA, reduce or eliminate the Salary Cap charge against the Team Salary Cap for certain roster classifications."
The HIP rule's ratification was expedited to allow the Washington Spirit to retain Rodman. The NWSL had already lost star U.S. players Alyssa Thompson and Naomi Girma to transfers to England earlier in 2025, and Rodman was receiving offers from Europe that the Spirit could not match within the confines of the salary cap ($3.7 million in 2026).
The HIP rule has been referred to internally and externally as the "Rodman Rule."
Under the settlement, the NWSL can also establish a limit on the number of HIP players per club in the future.
Rodman's multi-month public contract saga spawned another grievance from the NWSLPA against the league last year, which has also been settled.
Washington attempted to re-sign Rodman to a heavily backloaded multi-million-dollar contract last November prior to the creation off the HIP rule. NWSL commissioner Jessica Berman vetoed the agreement, and the league accused Rodman and the Spirit of preemptive salary cap circumvention. The union filed a grievance on Rodman's behalf, saying the NWSL's intervention was a "flagrant violation" of the player's free agency and a violation of at least five sections of the CBA.
Rodman signed a new contract with Washington in January worth over $2 million annually in total compensation under the terms of the HIP rule. Still, the grievance regarding her rejected contract remained open.
Under the settlement of that grievance, the league must now provide the union with written notice and an explanation of a rejected contract within 72 hours. The settlement maintains the league's authority to prohibit actions that they deem as intended to circumvent the salary cap, and the union maintains the right to challenge whether a specific transaction constitutes circumvention.
Burke said in a statement, when contacted by ESPN: "Our position is and always has been that the HIP Rule required collective bargaining, not consultation. The Multi-Grievance Settlement is the product of a collectively bargained process, reaffirming the importance and the efficacy of collective bargaining to achieve fair results for both the Players and the League."
Berman told ESPN in January that Rodman's new deal was a proof of concept for the league. Berman said repeatedly throughout the year that the league would evaluate how the rule was being used and update it if needed after analyzing its effects.
Most clubs are yet to utilize the HIP rule, which requires teams to spend to the maximum of their salary cap before they can designate a player's contract with HIP status. (Players don't sign special HIP contracts. If their contract qualifies and the team spends to the maximum of the salary cap, the team can access the additional $1 million in HIP money.)
ESPN previously reported that the accessible HIP funds will rise annually proportionate to the salary cap. High Impact Player funds will be $1.257 million in 2027, $1.342 million in 2028, $1.4 million in 2029 and $1.457 million in 2030.
The 2027 base salary cap before revenue sharing is $4.4 million. The $900,000 increase accounts for housing stipends being removed. Revenue sharing is expected to add over $200,000 based on prior years under the same media rights agreement.
Between the base cap, revenue sharing and HIP funds, ESPN projects that NWSL teams will have a spending limit of over $5.875 million in 2027.
With a $4.4M base cap in 2027, a player's minimum cap charge would need to be $528,000 to be HIP eligible.
The wider settlement between the league and union also requires greater financial transparency and oversight of revenue sharing.
The NWSL must provide the union with financial records verifying revenue calculations by June 15 each year, and the league must determine the projected revenue share by Oct. 1 of the prior year.
If actual revenue sharing exceeds projections, the team salary cap will be adjusted the same year to reflect the difference.
The settlement also expanded the categories of performance-based bonuses that players and clubs can negotiate and protects existing housing and automobile benefits for players who already have them specified in existing contracts.
