Deferral, furlough or full pay? Football faces COVID-19 wage decisions
Around a pandemic-wracked planet, reconciling a sudden sharp drop-off in income with ongoing overheads is a difficult circle to square for many businesses. Few industries mix the high cost and global profile of professional football - and the sport’s top clubs are reacting in a variety of ways to the need to pay vast salaries while stadiums remain locked and broadcast contracts unfulfilled.
On Tuesday, Tottenham Hotspur – the London-based Premier League side who reached last season’s Champions League final – announced that they would cut wages for all 550 non-playing staff by 20 percent for April and May. Explaining the move was “in order to protect jobs,” Tottenham’s chairman Daniel Levy said the club would be “utilizing, where appropriate, the government’s furlough scheme.”
Levy will be among those taking a pay cut, although he will not be eligible for the UK’s furlough scheme – under which the government will pay up to 80 percent of wages up to a maximum of $3,094 per month. According to the respected annual Deloitte survey, Tottenham is the world’s eighth largest football club by revenue, while Levy himself was paid $8.6m during the 2018/19 financial year.
In announcing an intention to use the furlough safety net, Tottenham followed fellow Premier League Norwich City and Newcastle United – the latter currently the subject of a $420m takeover bid from Saudi investors wishing to buy out owner Mike Ashley, the Sports Direct owner said by Forbes magazine to be worth $2.5 billion. Like Tottenham, Newcastle have furloughed all non-first-team staff.
On Tuesday, representatives of the Professional Footballers’ Association (PFA) were meeting to discuss player-wage deferral possibilities with officials from the Premier League and the Football League, the competition for the 71 clubs below the Premier League.
With much less money in the bank, many clubs may have to put their players on furlough too – if the PFA union allows it. But some players have been proactive in their deferrals.
At Leeds United – the club that tops the currently frozen table of the Championship division from which teams are promoted to the Premier League – first-team players, senior staff and executives have agreed to a wage deferral in order to protect the incomes of 272 lesser-paid employees and casual workers. It is understood wages will be capped at around half the Championship average, which could mean an 80 percent wage deferral for top earners.
Such measures have also been taken by some of Europe’s top clubs. FC Barcelona captain Lionel Messi, one of the world’s most celebrated players, has announced that he and his team-mates will take a 70 percent pay cut but also “make a contribution so that the club's [other] employees can earn 100 percent of their salaries."
Messi’s great rival for the unofficial title of world’s greatest player, Cristiano Ronaldo, is among the players to have deferred their wages for four months at Juventus. Italy’s most popular and (by some measures) successful club is based in Turin, one of the areas hit hardest by COVID-19; indeed, three high-profile Juventus players have tested positive for the virus. Now they and their coach Maurizio Sarri will defer payments until July.
The Juventus staff were following a trail blazed by players at Borussia Moenchengladbach, who finished fifth in Germany’s top-division Bundesliga last season. As long ago as 19 March, the Gladbach players offered to sacrifice salary, with coach Marco Rose and the club’s directors quickly following suit.
The following week, players at Bayern Munich, the Bavarian club which has won the Bundesliga for the past seven seasons, agreed a 20 percent pay cut, as did players at Ruhr-based rivals Borussia Dortmund and Schalke among other German clubs.
The structure of German football clubs, which grew out of social clubs and are prohibited from majority ownership by any one person no matter how wealthy, lends them to strong community-based action; not all leagues are set up as equitably. To a greater or lesser extent, all leagues, clubs and players are finding it hard to get by amid the commercial closedown and ongoing uncertainty. When the matches finally kick off again, it remains to be seen how important magnanimous gestures will be compared to the age-old priority of scoring more goals than the opposition.
Originally published by CGTN Europe, 1 Apr 2020
