One question still unanswered after 5-month investigation - which unnamed club breached Premiership salary cap in 2015

Lord Myners’ extensive 55-page salary cap review report published on Thursday left one question still unanswered after its five-month investigation – which club along with Saracens breached the Premiership salary cap in 2015. 

Saracens were automatically relegated from the Premiership last January following repeated breaches of the salary cap, and Myners claimed the tensions that bubbled to the surface over the past winter and resulted in the demotion of the Londoners stemmed from how matters were handled years earlier. 

Wasps and Harlequins were punished under the salary cap system for an “overrun tax” for relatively minor overspends in 2016, those clubs respectively paying a little over £20,000 and a little over £6,000 after their infringements were deemed to be matters of administrative oversight.

RugbyPass brings you the latest episode of The Breakdown, the Sky NZ TV rugby programme

RugbyPass brings you the latest episode of The Breakdown, the Sky NZ TV rugby programme

However, full disclosure regarding what occurred in 2015 eluded Myners due to how those cases against Saracens and another club that has never been formally named were settled outside formal procedures on the eve of a first hearing.

Myners wrote: “In December 2014, the salary cap manager (SCM) initiated an investigatory audit in relation to Saracens. When the SCM decided that Saracens failed to co-operate with this audit, he charged the club with a breach of the regulations and, in line with the regulations, a disciplinary panel was convened and a full hearing arranged. 

“On the eve of the hearing, the disciplinary proceedings were settled and it was agreed between the clubs that the case would not be heard and that Saracens would accept undisclosed sanctions as part of the settlement. 

“The salary cap regulations then in force did not provide for disciplinary proceedings to be settled. I conclude that this matter must, therefore, have been settled outside, and regardless of, the regulatory framework, with the consent of the clubs. 

“It might make good sense for settlements to be reached on occasions such as these – I believe that both the Premier League and UEFA have done so – but the critical point is not to give any impression of circumventing the regulations and the officials whose role it is to enforce them in order to reach a settlement.

“In other words, it seems – and I have been given no evidence to counter this narrative – that in 2015 the clubs stepped outside the processes they had established and struck a private deal with Saracens without any explanation about the terms of the agreement with Saracens nor any apparent sense of obligation to explain the decisions.

“It is perhaps not surprising that old enmities bubbled to the surface when the 2019 breach process began and an appearance of settling old scores emerged in various press reports. This was to the detriment of the Premiership.

“Multiple sources, who I have no reason to distrust, have told me that there was at least one other top-flight club under an early stage of investigation in 2015 and that this investigation was halted in a similar way, through a negotiation and agreement outside of the regulations. 

“I understand that this case centred on the role played by the club in question in securing a significant number of individual sponsorships for players which were either not disclosed to the SCM or not included in the salary cap calculation. 

“Once again it appears that proper process was set aside, with decisions taken into the hands of clubs so that they could find a route to resolution outside the formal regulatory process.

Staggering outlayhttps://t.co/n3DYKWgMrN

— RugbyPass (@RugbyPass) May 14, 2020

“It strikes me that the events of 2015 were a defining moment for the salary cap. The clubs effectively pulled the rug from beneath due process and established a precedent that the regulations could be changed at any time through negotiation and mutual agreement between the clubs.”

That precedent left Myners fearful about the salary cap’s effectiveness. “This is clear evidence that no matter how robust the regulations are, if the current cap governance rules pertain, the clubs have the power to decide to ignore them and take whatever action they unanimously agree to.

“If, as appears to me the case currently, the clubs continue to adopt an attitude that the regulations and procedures are a matter for private negotiation and not a transparent process, then faith in the system (a faith already undermined by the fact that Saracens breached it for not one, but three successive seasons) will not be rebuilt. 

“However much the clubs, through PRL, might try to set aside their individual interests when coming together to take decisions in the best interests of PRL, this is, in practice, a challenging thing to do.

“PRL is not alone in this. Similar challenges can arise with trade associations and mutuals – but there are opportunities here to apply principles from codes on governance and the management of such conflicts in a way that will encourage decisions and behaviour which support the clubs collectively and, beyond that, PRL and the broader rugby community.

“If all agree that a trustworthy salary cap regime is necessary for the league’s financial stability and competitiveness, it follows that the clubs must show unqualified support for regulations and actively promote confidence in the cap among all who take part in and support the game.”