21-day contract 'escape clause' set up for South Africans to head abroad
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A hot talking point in the SA rugby industry.
In a wide range of cost-cutting in South Africa which is being pieced together to allow SA Rugby to cut up to R1 billion from its budget over the next eight months, players will be able to explore overseas options for 21 days.
Negotiations started on 3 April and have moved swiftly and with minor hiccups as players recognised that they would not be immune to the knock-on effects of the coronavirus, which has suspended all competitions globally.
The new 'escape clause' is set to see players contributing 12.5% to the R1 billion budget cut. Normally there is a 60-day escape clause in any contract, but under the framework of the collective bargaining agreement, players conceded to 21 days.
‘We put the release clause in there because the transfer window in Europe is open now,’ chief executive of MyPlayers, Eugene Henning told Daily Maverick.
‘But in reality, very few players will be able to find contracts under the current conditions.’
The move could put the entire Rugby landscape in South Africa at risk as Henning explained: ‘It was a clause that also put the entire rugby industry at risk because, in theory, all 717 players could exercise that option, which would see the complete collapse of the rugby industry. Obviously, that scenario is unlikely, but theoretically, it could happen, and I can tell you there were some nervous employers."
The Terms of the collective agreement were broken down into nine points:
- 95% participation of members
- Salary reductions in proportionally equal measures
- Salary reductions until 31 December 2020
- A full pension fund holiday
- A full salary reduction, not a deferment
- 21-day period to cancel contracts with immediate effect
- No discretionary salary increases or bonuses in this period
- No contracting of new employees
- In case of liquidation, a full claim against original salary
A 95% participation was agreed because 100% was unrealistic and it was felt that if 10 out of 717 players disagreed, it wouldn’t be for the collective good. As it turned out, 95% was easily reached.
