September 19, 2017

September 18, 2017

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Pay Dispute – Australian Cricket Back on Track?

Last month, we wrote about the pay dispute between the Australian cricket governing body, Cricket Australia (CA), and the players.  At that time, deadlock prevailed and the Australian players were refusing to play as they were effectively unemployed when the old Memorandum of Understanding (which governed matters such as pay) expired.

At the beginning of this month though, it appears that good news has replaced some of the negative headlines – at least, good news to those who did not hope for the Ashes to simply be handed to England by default!  Agreement has been reached between CA and the players’ body (ACA).  While it is not entirely signed, sealed and delivered, it seems that a compromise on pay has been reached, such that Australian cricket can forget about pickets and return to wickets.

In short, a revenue-sharing model has been retained, albeit a slightly different one to before.  I will avoid going into the finer detail on the differences to the old model, because many argue there aren’t any and I do not have my magnifying glass with me.

Instead, I want to focus on the fallout and the wider issues for cricket.  Neither side have come away from this saga particularly happy.  The ACA have said never again and CA have said that neither side got everything they wanted.  David Warner regretted how it had played out in the media, although he had been the one to drop the possible Ashes strike bomb into an interview.

It is not often good practice to determine which side ‘won’ in such a situation. Strained relationships, damaged reputations and financial losses normally limit a ‘win’. However, there are many, including Australian legend Allan Border, that believe the players have struck a win.  It was the revenue model which CA wanted to get rid of and that has not happened.  CA had also wanted an increase in funding for grass roots cricket which it looks like it has done, but the status quo looks largely unchanged considering months of bitter dispute.

So it looks like a win for player power.  If that is the case, it could be argued that much of that power stems from T20 cricket and the revolution that it has generated in the game.  As a format (for professional cricket), it has only been around for about 15 years.  However, in that time, the game has developed hugely, with both batters and bowlers devising new methods to suit the shorter, faster game type.  It is almost unrecognisable to players of a different era.  You wouldn’t have caught Geoffrey Boycott playing a ramp shot over his own head!

It is not just the players’ methods which have developed, but the commercial landscape too.  The speed and ferocity of the cricket action in a T20 match has lent itself to slightly more proactive marketing campaigns than the more attritional test matches.  This attracts more sponsors, which in turn leads to more cash in the game.

A prime example is the IPL, recently celebrating its 10th season.  The glitz and glamour is something to behold and the money, in cricketing terms at least, has been growing at a rate of knots towards eye-watering levels.  In the most recent season, England’s talismanic all-rounder Ben Stokes was bought for an incredible £1.7 million.  OK, not exactly Neymar levels, but that is not a transfer fee.  Subject to relevant deductions, that is effectively money paid to him for his services for that IPL season (a period of about 6 weeks).

Stokes is not the only player who can attract large fees.  Six-hitting machines like Chris Gayle, Brendon McCullum and AB de Villiers are stardust to T20 clubs and franchises, helping to win matches but also attract sponsors and gain social media exposure.  As the number of T20 competitions around the world increases, there is a greater need for players to fill those competitions and so those players need to be attracted.  Therefore, sums in the T20 game may not slow down for some time yet.

And this is where the player power lies.  Years ago, a top cricket player needed to play at international level in order to earn the best salary as a cricketer. There were no other options and so it would have been very difficult to hold a governing body over a barrel.  However, the top players now could (and some do) earn equivalent money playing in domestic T20 competitions around the world.  Suddenly, governing bodies face their best players refusing to play international cricket for various reasons, as they know they can earn their corn elsewhere.

For wider sport, this is not a new phenomenon and cricket has had revolutions in the past (see Kerry Packer).  The question here is whether this is a bubble preparing to burst or whether we are witnessing a permanent change in the game.

© Copyright 2017 Squire Patton Boggs (US) LLP

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About this Author

Christopher Lynn, Squire Patton Boggs, London Labor Lawyer
Associate

Chris Lynn is an associate in our Labour & Employment practice group based in our London office. He trained with Squire Patton Boggs, completing seats in Corporate, Litigation and Pensions. Chris also undertook two secondments, firstly at a leading British motorsports team where he supported the legal department and also at a major retailer where he worked alongside the HR and Policy team. He is involved in the Japan Desk, an initiative to provide tailored advice and support for Japanese businesses in the UK, including seminars and networking events.

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