December 31 looms as South African rugby’s predicted doomsday should the Covid-19 coronavirus pandemic prevent any domestic or international games from being played.
While that is obviously a worst-case scenario, there are no guarantees as to when the sport, which has already seen numerous competitions suspended or cancelled, will resume. Even less certain are the conditions under which the resumption would happen, what with large gatherings and travel being contributors to the spread of the virus.
SA Rugby was careful not to invoke such apocalyptic language in a press release that offered a glimpse into its contingency plans this week, but City Press understands that the word ‘doomsday’ was mentioned to the players and support staff bodies in discussions about the way forward.
As things stand, the rugby community hopes to be back playing in September, but there is still a fear that the virus’ spread could only peak then, which would give way to “desperate” ambitions of resuming the season in November and December “even without crowds”, a source said.
Failure to get back on the park later this year would put provincial unions, franchises and SA Rugby, already reeling under the broadcast rights stipends being euphemistically “affected” and sponsors reducing their payments on commercial partnerships by 35%, in a position where they can’t pay players from early next year.
In attempts to “safeguard the game’s future”, SA Rugby’s statement said its Industry Financial Impact Plan was a culmination of the rugby industry’s agreement of “in principle, a wide-ranging plan to cut between R700 million and R1 billion from its budget over the next eight months” to ensure the sport’s viability post-Covid-19.
In documents circulated to the players and rugby employees by MyPlayers and Sport Employees Unite, respectively,
- Savings from the costs of staging competitions, and travel and accommodation expenses;
- Operational expenses across the industry;
- Reductions in distributions to provinces and players’ trust for use of collective commercial rights;
- Introduction of financial arrangements; and
- Salary reductions.
While a cost-cutting exercise climbing to R1 billion sounds hefty, our source explained that the cancellation of the various youth weeks alone had resulted in savings of between R50 million and R60 million. A quarter of the savings is expected to be yielded by the Industry Salary Plan (ISP).
According to the ISP sent to the players and industry employees, both parties will be responsible for 12.5% each in salary reductions for a total contribution of 25% to the cause, which will ironically kick in on Friday – Worker’s Day – and reflect in their bank accounts on May 30.
While players and employees earning R240 000 or less annually will be exempt from the pay cuts, the rest – depending on their salary scales – can expect an income shrinkage of up to 43% for the high-end earners. The names mentioned as examples are SA Rugby chief executive officer Jurie Roux, director of rugby Rassie Erasmus and Springbok captain Siya Kolisi.
- R0 to R240 000 – 0% (273 players)
- R240 001 to R500 000 – 13% (198 players)
- R500 001 to R750 000 – 22% (81 players)
- R750 001 to R1 million – 27% (45 players)
- R1 000 001 to R1.5 million – 31% (53 players)
- R1 500 001 to R2 million – 33% (22 players)
- R2 million and above – 38% (45 players)
The players and employees have also been given the option of a pension fund holiday of 15% if they feel they need the financial relief, a move criticised in some quarters for the tax implications it would have when the crisis is over.
“If you can continue paying your pension fund, continue – it’s not compulsory,” said the source. “If you can’t, which many people can’t, you don’t have a choice. You either want to pay for your house and car, or suffer.”
Those who feel the collective arrangement does not work for them have been given a 21-day grace period – until May 14 – to try to negotiate themselves out of their contracts, but the feeling seems to be: “Do you want to be in a job or not?”
This will be tricky for Pro14 players whose contracts run out at the end of June. But those who hadn’t already negotiated with their franchises have been encouraged to do so urgently.
During the cost-cutting period, players won’t be eligible for increases or bonuses and can claim their full salaries in the event of a provincial union’s liquidation. And there will be no contracting of new employees (except for players, bearing in mind the squad limit of 45) “unless it is to replace a current contract and is approved by the industry’s Covid-19 committee”.