The level of the Salary Cap is proportionate and aligned to the growth of the business and is linked directly to the annual net central distributions to the Clubs from Premiership Rugby. The current level of the Salary Cap for 2015/16 is £5.1m, plus 2 Excluded Players whose salaries sit outside the cap, enabling Clubs to recruit and retain world class talent. Clubs are also encouraged to develop home grown talent by accessing up to £400,000 of Home Grown Player Credits, they can provide an unlimited education (academic or vocational) fund to their Players, and can replace long term injured players without impacting on their Salary Cap ceiling. As this is a Rugby World Cup season, there are RWC Credits available for a Club to manage the absence of players selected in the tournament at a rate of £35,000 per RWC Player. There is also an Academy Salary Cap of £100,000, meaning the total available to clubs is £5.6m (plus the excluded player and injury replacement provisions), a significant increase from the original £1.2m in 1999 and £4m in 2010.
Matches in the Aviva Premiership Rugby competition get more compelling and competitive every year and the Salary Cap is fundamental to the long term success of this competition and the clubs who play in it, from both a financial and competitive perspective. This responsible financial management helps support investments made by shareholders, players and fans in building a bright future for the Aviva Premiership Rugby competition and its clubs.
2015/16 Salary Cap (current season)
• £5.1 million - Senior Salary Cap
• £400,000 - Home Grown Player Credits* see definition below
• 2 Excluded Players (Salary is not included in the Salary Cap)
• Injury Replacement *** see notes below
• Clubs can also benefit from the £100,000 Academy Cap which supports the development and retention of home grown talent at each Club. Each Home Grown Academy Player's Salary will not be counted in the £100,000 Cap. ** see definition below.
Future Seasons (2016/17 & 2017/18)
- The Base levels will be £6.5m in 2016/17 and £7m in 2017/18
- The Base levels will include increased Home Grown Player Credits* up to a maximum of £500k in 2016/17 and up to a maximum £600k in 2017/18 to incentivise further the long-term development of talent through the Academies
- In addition to the Base levels, Injury Dispensations* up to a maximum of £400k per season continue to be available to each Club.
- Each Club can continue to have a maximum of two Excluded Players**, with one being new to Premiership Rugby or not having played in Premiership Rugby for at least 12 months
- A new England Senior EPS or International Player Credit*** in addition to the Base level to facilitate squad strengthening, particularly cover for player absence during international periods.
- There will be a new overrun tax on any Salary spend up to five per cent over the Base level (5 per cent being £325k in 2016-17 and £350k in 2017-18)
1. A Club may nominate to the Salary Cap Manager up to two Players to be excluded from their Salary Cap calculations. A Club shall be entitled to nominate a Player as an Excluded Player who:
(i) has been a Player of the Club for at least two full Salary Cap Years prior to the Salary Cap Year in which he is nominated as the Excluded Player; or
(ii) has not been a Player of any Aviva Premiership Club during the previous Salary Cap; or
(iii) has been a Player (but not an Excluded Player) for the Club in the previous Salary Cap Year and was not a Player for any other Club for at least one Salary Cap Year immediately prior to joining the Club.
2. A Club shall only be entitled to nominate a Player as a second Excluded Player who:
(i) has not been a Player of any Club during the previous Salary Cap Year; or
(ii) was that Club's second Excluded Player in the previous Salary Cap Year.
*Home Grown Player Credits: A Club shall be entitled to up to £400,000 worth of credits for players (£50,000 per Home Grown Player) who have graduated from the Club's Academy. A qualifying player:
- must have joined the Club before his 18th birthday; and
- earns more than £30,000.
These credits only apply to the Senior Ceiling. For example, if a qualifying player earns £55,000, only £5,000 would be counted in the Club's Salary Cap calculations.
**Academy Cap: The Academy Cap of £100,000 is for all Academy Players under the age of 24 years old and earning less than £30,000 Salary. Note: A Player's Salary Cap status is irrelevant in relation to dual registration. A Home Grown Academy Player's Salary shall not be counted in the £100,000.
**Home Grown Academy Player: is an Academy Player who, as demonstrated by his Club to the Salary Cap Manager by 1st September in the relevant Salary Cap Year, either:
(a) became a Player of the Club before reaching his 18th Birthday and who has never been a member of any other Club's England Rugby Academy; or
(b) became a Player of the Club before reaching his 18th Birthday having previously been a member of another Club's England Rugby Academy and has been a member of his current Club's England Rugby Academy for at least two complete calendar years prior to the current Salary Cap Year;
**Injury Replacements: Where a player is injured for 12 weeks or more the Club may apply to the Salary Cap Manager to recruit a replacement player. The replacement player will then be permitted to remain with the Club for the rest of the season. The replacement player's salary for the duration of the dispensation shall sit in a separate £400,000 cap containing the Club's other injury replacements. The Club may not exceed the £400,000 during the salary cap year. In the event that a player is injured and that injury crosses over two Salary Cap years the injured player must be injured for at least the first eight weeks at the start of the year, counted from 1 August.
The application must be made while the player is still injured and the replacement player must be:
The same position as the injured player; not be deemed to be more experienced than the injured player (i.e. same or less);
Given a salary which is either comparable or lower than the injured player.
When determining these factors the Salary Cap Manager shall consider the general state of the market for availability of players in that position, the timing of when the cover is required, and any other relevant factors.
***Senior EPS/International Player Credit
Where a club is unable to select a player in its squad for a Premiership Rugby or European fixture as a result of that player being selected in a match day squad by his national union or absent under the terms of the Heads of Agreement. There shall be a total allowance up to £80,000 per player depending on meeting certain qualification and selection criteria.
How is it managed?
The Salary Cap Manager is responsible for the management of the Salary Cap in the following ways:
On-going monitoring and investigations
Throughout the year every Premiership Rugby Club is required to submit to the Salary Cap Manager within 28 days of signing full copies of all Contracts and arrangements for playing (employment) and non-playing (e.g. image rights) services. All documents relating to Loans and copies of any Contracts/written documents evidencing payments to Player Agents are provided. These submissions are reviewed on an on-going basis and the Salary Cap Manager has the ability to investigate any arrangement between a Player and a Club. Player interviews are carried out on a regular basis to support the management of the Salary Cap. There is also a formal whistle blowing policy where people can speak to the Salary Cap Manager on a confidential basis, by emailing firstname.lastname@example.org.
In September each season every Premiership Rugby Club will provide the Salary Cap Manager with a Certification setting out their spend during the previous Salary Cap Year together with a Declaration (forecast) for their expected spend during the current Salary Cap Year. Both of these documents are approved by a Club's Board and signed off by the Chairman, Chief Executive and Finance Director. The Salary Cap Manager will review these documents and then submit them to the independent auditors who will then (during October and November) audit each Club in accordance with the Salary Cap Regulations.
In addition to the Annual Audit the Salary Cap Manager may now undertake an Investigatory Audit which can involve using independent experts to access relevant records held by a club who are suspected of breaching the regulations.
All Clubs are subject to the Regulations and each Club agrees to be bound by and comply with the Regulations. In respect of each Salary Cap Year, the issue of whether or not any breach has occurred and the potential consequences of such breach are determined by reference to the Regulations of that year and any Board resolutions. The Salary Cap Year runs from 1 July to 30 June. The responsibility to fulfil the obligations set out in the Regulations rests with the Chief Executive of each Club. The Salary Cap Manager will have up to five years to initiate action against a Club for any alleged breach of a regulation. By way of illustration, if an alleged breach relates to the Salary Cap Year 2008-09 it must be notified to the relevant club as an alleged breach by no later than 30 June 2014.
If a Club were to exceed the Senior Ceiling or submits a False Declaration the Salary Cap Manager would charge the Club with breaching the regulations and an independent panel would be convened to hear the case. The hearing would be much like any discipline process undertaken by sports governing bodies. The sanctions for any breach of the Senior Ceiling includes both financial and competition point penalties.
A False Declaration would arise if a Club flagrantly, recklessly or deliberately submitted false and/or misleading Salary information to the Salary Cap Manager. In this instance the Salary Cap Manager would charge the Club with submitting a False Declaration and an independent panel would be convened to hear the case.
There could also be administrative breaches where the Salary Cap Manager can issue a fixed fine of up to £800 for each administrative offence which includes failure to submit documents on time (e.g. the late submission of a player's contract).
The RFU's Agent Regulations also provide for the involvement of an agent in any alleged breach of the Senior Ceiling or False Declaration which could result in the agent losing his registration with the RFU.
Salary Cap Regulations
Please click here to download the Salary Cap Regulations PDF.