CHAMPIONSHIP CIVIL WAR
Talks over wage cuts on brink of collapse
Championship clubs are facing a civil war with their players over wages and threatening to impose uniform cuts, after the pFa rejected a plea from the EFL yesterday to mediate in the bitter dispute.
Sportsmail can reveal the EFL set the pFa a deadline of today to endorse their proposals for League-wide cuts and deferrals, but sources indicated last night that the players’ union would reject this request.
The pFa’s refusal to support a centrally agreed approach to mitigating the huge financial losses resulting from the suspension of the season has left the clubs to negotiate with their players on an individual basis — but those talks are not going well. it can also be revealed:
A proposal from several Championship clubs for a coordinated approach to wage cuts is on the brink of collapse.
At least half-a-dozen Championship clubs will struggle to pay this month’s salaries if there are no cuts.
Clubs insist wage cuts rather than deferrals are the only long-term solution to the crisis.
The cost to clubs of extending playing contracts in the Championship beyond June 30, as recommended by FIFA, is projected to run into tens of millions of pounds.
The PFA’s refusal to endorse the EFL’s proposals runs counter to guidance issued by FIFA who, in a working document published by Sportsmail earlier this week, called on all parties to reach ‘appropriate collective agreements’ over wages.
Championship clubs are the most immediately vulnerable to bankruptcy in the wake of the coronavirus crisis, due to the huge outgoings in a division where the collective losses totalled £650million last season.
They are heavily reliant on match-day income for cash flow, a revenue stream that has disappeared.
as a result, many clubs will struggle to pay salaries later this month without getting the players to agree wage cuts.
Derby County, Reading and sheffield Wednesday are among those encountering the greatest difficulties.
Because a deal with the pFa is all but impossible, several clubs have proposed taking collective action to impose a pay cut of 50 per cent on all wages above £6,000 a week — half of which would be deferred — but reaching an agreement with all 24 clubs is proving difficult.
Leeds and Birmingham reached agreements with their players to defer a portion of their wages for the duration of the crisis, while millwall have put their entire first-team squad on furlough. Derby, nottingham Forest, swansea, Cardiff and QpR have put non-playing staff on furlough, with others set to follow.
however, players at all clubs are refusing to accept cuts, with the support of the pFa — leaving their employers pondering whether to breach their contracts by imposing it anyway.
such a move would risk some players walking out and agreeing free transfers to premier League clubs, but the majority would have nowhere to go given the financial uncertainty.
While most players are prepared to accept wage deferrals, they oppose cuts for numerous reasons including their significant financial liabilities, uncertainty over future contracts and earnings, and the principle of handing back money to owners which could be used to effectively replace them in the future.
But executives at a number of Championship clubs have told
Sportsmail that cuts rather than deferrals are the only solution in the longer term as income levels will not return to normal when football resumes.
The £125m and £50m aid packages clubs have received from the premier League and EFL respectively are advances on future television revenue rather than additional money. Clubs are also anticipating significant losses in commercial and sponsorship income due to the recession.
Fears of a financial meltdown are so acute at some clubs that — as Sportsmail revealed earlier this week — there have even been discussions about entering into joint administration, which would enable them to scrap players’ contracts and only pay a proportion of their outstanding liabilities.