Why an NRLOL salary cap of $9.5 million could see players lose out
Posted: Sat Aug 12, 2017 4:31 pm
Negotiations involving the NRL, players' union and clubs are expected to settle on a salary cap of $9.5 million for next year, but the devil will be in the detail.
A player payment budget of $9.4 million plus a motor vehicle allowance of $100,000 will satisfy most clubs, but prompt panic selling by those who have gambled on the cap being $10 million.
Some clubs speculate that if the NRL loads up the cap with previously excluded items, players may actually receive less than the $9 million offer currently on the table.
For the first time in the 110-year history of bargaining between clubs and players over playing contracts, it's in the interests of both for a club's wage bill to rise.
These clubs anticipated the cap would be $10 million because it was the standard example offered when explaining the 130 per cent outlay by the NRL in the negotiations with ARLC chairman John Grant.
Player managers, who are paid a proportion of a client's salary, also fuelled the $10 million myth.
Some clubs have suggested to the NRL's chief operating officer, Nick Weeks, who is leading the NRL in negotiations, that he should allow a little wriggle room, given the protracted delay in the collective bargaining agreement negotiations.
Weeks responded with words to the effect: "You may well have committed $10 million, but the NRL will only register $9 million worth of contracts for next season."
Clubs are confident negotiations will finalise the cap at $9.5 million, which will satisfy most of them.
However, the clubs believed to be already over – the Bulldogs, Cowboys and Roosters – may be forced into a fire sale of players. This would further accelerate the already embarrassing situation of clubs funding the contracts of players in rival teams.
The Cowboys have bought the Storm's Jordan McLean for next season, while Melbourne have secured the Bulldogs Sam Kasiano to replace him.
If the Cowboys are over the cap, forcing them to release McLean back to the Storm, then Melbourne would not be willing to pay all his contract, having already secured Kasiano from a club which can't possibly afford to take him back because they have bought Aaron Woods from Wests Tigers.
Will clubs, who attempt to renege on the deals, be sued for breach of contract? If they honour the deals, or are forced to absorb most of the salary of those they on-sell, they will cop heavy fines from the NRL for exceeding the cap.
Wests Tigers, who lost three of their best four players during a saga that brought credit to no one, are now inadvertently in a position of having salary cap space.
Apart from the 30 per cent payment to clubs, it's also in the NRL's interest to keep the salary cap down because of its need to sell two clubs, the Knights and the Titans.
Any prospective buyer will want to take over a wages bill as low as possible.
Another contentious point is the matter of third party agreements, with some clubs estimating the Broncos have $2 million in deals with players.
Third party agreements are outside the cap and therefore are an obstacle in creating a level playing field.
Whatever the final outcome of deliberations over the salary cap for the next five years, players will be receiving nearly 50 per cent more than previously, unless the NRL successfully loads the cap with previously excluded items.
A player payment budget of $9.4 million plus a motor vehicle allowance of $100,000 will satisfy most clubs, but prompt panic selling by those who have gambled on the cap being $10 million.
Some clubs speculate that if the NRL loads up the cap with previously excluded items, players may actually receive less than the $9 million offer currently on the table.
For the first time in the 110-year history of bargaining between clubs and players over playing contracts, it's in the interests of both for a club's wage bill to rise.
These clubs anticipated the cap would be $10 million because it was the standard example offered when explaining the 130 per cent outlay by the NRL in the negotiations with ARLC chairman John Grant.
Player managers, who are paid a proportion of a client's salary, also fuelled the $10 million myth.
Some clubs have suggested to the NRL's chief operating officer, Nick Weeks, who is leading the NRL in negotiations, that he should allow a little wriggle room, given the protracted delay in the collective bargaining agreement negotiations.
Weeks responded with words to the effect: "You may well have committed $10 million, but the NRL will only register $9 million worth of contracts for next season."
Clubs are confident negotiations will finalise the cap at $9.5 million, which will satisfy most of them.
However, the clubs believed to be already over – the Bulldogs, Cowboys and Roosters – may be forced into a fire sale of players. This would further accelerate the already embarrassing situation of clubs funding the contracts of players in rival teams.
The Cowboys have bought the Storm's Jordan McLean for next season, while Melbourne have secured the Bulldogs Sam Kasiano to replace him.
If the Cowboys are over the cap, forcing them to release McLean back to the Storm, then Melbourne would not be willing to pay all his contract, having already secured Kasiano from a club which can't possibly afford to take him back because they have bought Aaron Woods from Wests Tigers.
Will clubs, who attempt to renege on the deals, be sued for breach of contract? If they honour the deals, or are forced to absorb most of the salary of those they on-sell, they will cop heavy fines from the NRL for exceeding the cap.
Wests Tigers, who lost three of their best four players during a saga that brought credit to no one, are now inadvertently in a position of having salary cap space.
Apart from the 30 per cent payment to clubs, it's also in the NRL's interest to keep the salary cap down because of its need to sell two clubs, the Knights and the Titans.
Any prospective buyer will want to take over a wages bill as low as possible.
Another contentious point is the matter of third party agreements, with some clubs estimating the Broncos have $2 million in deals with players.
Third party agreements are outside the cap and therefore are an obstacle in creating a level playing field.
Whatever the final outcome of deliberations over the salary cap for the next five years, players will be receiving nearly 50 per cent more than previously, unless the NRL successfully loads the cap with previously excluded items.
](./images/smilies/eusa_wall.gif "Brick wall"){kind=small}
but but but