SARACENS MAY NOT GO DOWN
Stars in talks about downing tools over hefty pay cuts
SARACENS could be saved from Premiership relegation if a number of clubs are forced out of business due to their lack of income as a result of the coronavirus pandemic. The disgraced champions were fined £5.36million and docked 105 league points earlier this season for breaking salary cap rules, consigning them to the Championship. But Premiership rugby clubs are facing financial meltdown, with no games scheduled for the foreseeable future, and most have already ordered their staff to take blanket 25 per cent pay-cuts. Well-placed club sources have expressed fears to Sportsmail that more than one top club could go to the wall in this period when the season is suspended, as so many are in a precarious financial position. Only Exeter are making a small profit. If that happens, Saracens could be reprieved because they would be needed to form a league next year with the other clubs that are still in business. Based on last year’s accounts, the Premiership clubs lose around £50m collectively in a completed season. Therefore, Saracens dropping into the second tier is not yet a done deal. If all clubs survive the shutdown, Newcastle Falcons, who are 18 points clear at the top of the Championship, are set to replace Saracens in the Premiership next season. But with the RFU cancelling all rugby below the Premiership, Newcastle have not been told if they will definitely be promoted — although they should go up if enough clubs can ride the storm to form a league.
ENGLISH rugby was in turmoil last night as players were being advised to consider strike action after Premiership clubs demanded swingeing pay cuts amid fears of impending financial disaster.
Sportsmail can reveal that senior officials are already braced for the suspension of the top division until June at the earliest, despite an initial postponement period expiring on the weekend of April 24-26.
The RFU announced yesterday that all competitive rugby below the Premiership is cancelled for the remainder of the 2019-20 campaign — but the leading clubs are determined to ensure that their league reaches a conclusion.
Employees at the majority of Premiership clubs have been told that they will have to accept a 25 per cent reduction in wages due to the loss of match- day revenue.
Players are mindful of the profound impact of the coronavirus outbreak, but there is a militant mood in some quarters because the guidance is that full pay will not be reinstated until fixtures resume, rather than when there is a return to full training, which will be sooner.
Sources have revealed that there have been talks about the possibility of refusing to train as full squads until there are assurances that salaries will return to contracted levels. Players have been advised that the clubs’ actions are illegal and represent breach of contract.
Many have agreed to accept the drastic measures but the guidance is that they would be free to find another club or take legal action if they see fit.
Indications last night were that most top- flight clubs have informed their players of wage cuts. These include Harlequins, Leicester, Sale, Saracens, Wasps and Worcester. It is unclear if
Exeter, London Irish and Northampton will follow suit, but there have been calls for a unified approach to the predicament.
Clubs making cuts have insisted these are essential steps to stave off the threat of bankruptcy and that prospect appears to loom large. Officials have grave concerns that at least two clubs could go out of business soon.
Newcastle — who should return to the Premiership next season — are understood to have warned players that they might not be paid. Desperate efforts are being made to stay afloat after remaining Championship fixtures were cancelled.
Wasps are a marquee name in English rugby but they are thought to be sitting on a debt mountain since relocating to Coventry and launching an ambitious bond scheme.
Worcester are another club regarded as being at risk and there may be others if this shutdown period drags on into the summer.
Last year, each club received £13.5million after private equity firm CVC bought a commercial stake in the Premiership. This season, Saracens’ rivals each received a £350,000 cut from their fine for salary cap infringements. However, these windfalls don’t appear to have sufficiently reinforced bank accounts.
Clubs are angry vital funding may be withheld by Premiership
Rugby (PRL). While there has been speculation that BT Sport had withdrawn payments to PRL because of the sudden loss of fixtures to televise, multiple sources have claimed payments are up-to-date.
PRL have considered holding funds in case they need to reimburse the broadcaster. There have also been suggestions PRL are refusing to release funds from a £30m contingency pot.
Another accusation is that the PRL hierarchy have stated they will not contemplate pay cuts of their own, despite calling for clubs to mount a unified campaign to keep the game solvent.
There has been no official response from PRL, merely hints about unspecified financial and staffing cuts.
Meanwhile, the RFU have informed staff that some of them must accept reduced hours or unpaid leave.
However, the union have refused to confirm if chief executive Bill Sweeney and other top executives will be taking pay cuts in light of concerns about the financial outlook for the sport.
If the club season can be resurrected, European competitions are certain to be sacrificed in an attempt to ensure the Premiership is played to a conclusion.
But any push to extend the campaign beyond June 30, when many contracts will expire, would create chaos.