Unions get R60m salary cap in SA Rugby's new contract system

Jurie Roux (SA Rugby CEO) arrives to hand in the SA Rugby bid submission for the 2023 Rugby World Cup to Brett Gosper (World Rugby CEO) and Alan Gilpin (Head of Rugby World Cup) at World Rugby House on May 30, 2017 in Dublin, Ireland.
Jurie Roux (SA Rugby CEO) arrives to hand in the SA Rugby bid submission for the 2023 Rugby World Cup to Brett Gosper (World Rugby CEO) and Alan Gilpin (Head of Rugby World Cup) at World Rugby House on May 30, 2017 in Dublin, Ireland.
Image: Gallo Images

A new professional contracting model will see a salary cap of R60-million implemented at eight major unions with a maximum of 45 contracted players allowed‚ SA Rugby announced on Friday.

The new system‚ which has taken over two years of negotiations between SA Rugby‚ players and unions to reach‚ is an attempt to create greater job security and clearer pathways for players and more financial stability for unions.

For the first time since rugby turned professional in 1996‚ SA Rugby will no longer directly contract Springboks. While‚ in a second major change‚ provincial unions have agreed to a cap on player budgets.

It will also provide greater earnings for a wider cross-section of players although the very top earners will be scaled back.

A prominent Springbok player‚ who is currently earning between R8m and R9m will in future earn between R7m and R8m.

There is a separate category of players‚ called Players of National Interest (PONIs) whose salaries will be supplemented by SA Rugby. But crucially their provincial contract is the only one they hold.

“It’s been a decade since the Springboks won Tri-Nations or a Rugby Championship‚” director of rugby Rassie Erasmus said.

“In the past we have contracted a handful of Springbok players – between 13 and 20 – and tried to keep them in the country‚ but the return on the investment hasn’t worked. If there are injuries to three or four players and we have to pay others the same‚ the budget is gone.

“So after lots of consultation with the franchises we will contract more PONIs‚ hopefully as many as 80.”

SA Rugby CEO Jurie Roux said: “The existing model plainly was not working. The rugby economy could not continue to support such a large‚ fully professionalised workforce while the strategy to retain top players in South Africa had become too narrowly focused.

“The new model will see our best players properly looked after from a payment point of view – in the South African context – as well as from a player management and development point of view.

“At the same time it will improve the financial sustainability of unions by controlling budgets and sharing out the Springbok payment budget through the unions to a broader pool of players.

“There will be challenges and growing pains I am sure. But for the first time the three constituent parties in the player journey – the players themselves‚ the employers and the national body – have been able to sit down‚ take a strategic view and come up with what we believe will lead to a more sustainable future for the game.”

Eugene Henning – CEO of the Players’ union‚ MyPlayers – added: “As an industry we have too many players and it’s an issue for two reasons – there is not enough money and the other we are not doing enough for player development.

“We looked at what New Zealand and others have been doing in terms of contracting and to reach a model that works for SA.

“From a players’ perspective they are positive about it.

“On a national level it makes provision for succession planning and more players will be involved in the national plan and there is a real incentive to make it to the Test team.

“On a provincial level it does a lot more for job security in the system. There is a clear career path and also financially‚ on average the guys are better off. It’s not the perfect system but it’s a good step.”

The player categories are:

• Professional players (full-time players) who will be eligible to play in Vodacom Super Rugby‚ Guinness PRO14 and Currie Cup Premier Division competitions;

• Semi-professional players (part-time rugby players) who may only be contracted to play in the Currie Cup First Division and in the SuperSport Rugby Challenge;

• And development players (21 or younger who have not been offered professional contracts) who will play in the Under-21 and Under-20 competitions. However‚ they may be made available as temporary replacements for professional and semi-professional players;

• Club players may be contracted as temporary replacements for injured professional and semi-professional players. Critically‚ agreement had been reached on squad size and player salary bill.

• Vodacom Super Rugby‚ Guinness PRO14 or Currie Cup Premier Division unions may not contract more than 45 professional players and have a salary bill greater than R60m (which will be phased in over three years) or of more than R15m in the case of the Pumas and Griquas.

• Currie Cup First Division teams may contract no more than 23 professional players or more than 40 players in total (including semi-professional players). Their remuneration cap is set at R6m.

• Unions may contract an unlimited number of development players providing they stay within a cap of R10m for Vodacom Super Rugby and Guinness PRO14 unions (reducing to R7‚5m in year two) and R1m for all other teams.

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