Saracens to fight points deduction over breach of salary cap

The Premiership champions, Saracens, have pledged to fight the imposition of a 35-point deduction and £5.36 million (€6.2m) fine after they were found to have breached salary cap regulations.

Nigel Wray, the Saracens chairman, described the sanction by Premiership Rugby as "absolutely devastating" after an independent panel upheld charges that the club exceeded the cap by more than £2 million across the past three seasons.

“We will appeal all the findings”, said Wray. “It has been acknowledged by the panel that we never deliberately sought to mislead anyone or breach the cap and that’s why it feels like the rug is being completely pulled out from under our feet.”

However, there was support for the sanction from other Premiership clubs while Tony Rowe, chief executive of Exeter, who lost the Premiership title to Saracens in June, called for a more severe punishment.

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“They should be relegated,” Rowe said. “It just leaves a sour taste in the mouth when you go to Twickenham and we just didn’t quite have enough firepower, you know? And that’s because we didn’t break the salary cap and pack our squad full of international players.”

Revelations that some of Saracens' most high-profile players, including England internationals Owen Farrell, Maro Itoje and the Vunipola brothers, had entered into investment or property partnerships with Wray prompted an extensive review by Premiership Rugby's salary cap manager earlier this year.

Andrew Rodgers concluded Saracens had a case to answer and charges were brought in June before it was referred to the independent Sports Resolutions disputes service. After a five-day hearing in September and October, a panel chaired by the barrister John Dyson advised that the club had breached the cap and should be sanctioned.

A statement from Premiership Rugby (PRL) on Tuesday read: “The decision of the independent panel is that Saracens Rugby Club failed to disclose payments to players in each of the seasons [2016-17, 2017-18 and 2018-19]. In addition the club is found to have exceeded the ceiling for payments to senior players in each of the three seasons.”

The 35-point sanction represents the maximum under the regulations and would mean Saracens are immediately pitched into a struggle against relegation if it is upheld. The punishment, however, is suspended pending the outcome of the appeal process. Not since the 2008-2009 season would a 35-point deduction have resulted in Saracens’ relegation, but to overcome such a deficit from the off would require new dimensions of their squad’s famous mental resilience.

Productive academy

The salary cap now stands at £7 million plus two marquee players, with a number of other allowances made for homegrown and English-qualified players. Saracens’ academy is the most productive in the Premiership, supplying England with the spine of its current team.

Nine players – including South Africa's Vincent Koch – featured during Saturday's World Cup final. Saracens have won multiple trophies: five times English champions and three Champions Cups in the past nine seasons.

Despite the panel findings, the club maintains the investments did not come under their salary framework. “The club will continue to vigorously defend this position especially as PRL precedent already exists whereby co-investments have not been deemed part of salary in the regulations,” Saracens said in a statement.

“As previously stated, the club made administrative errors relating to the non-disclosure of some transactions to PRL and for this we apologise.

“Furthermore, it is the club’s belief that the panel’s narrow interpretation of the regulations is detrimental to player welfare across the league and is damaging the development of elite level rugby in the UK.”

The sanction was supported by other Premiership clubs. “The salary cap regulations were unanimously agreed by all clubs so everyone is aware of their obligations to comply with them and of the potential consequences should they breach them,” said Worcester Warriors in a statement.

Steve Diamond, the director of rugby at Sale Sharks, added: "The cap has to be enforced. I've not read the judgment but if that's what they deem appropriate, then that's the way it is. Everyone knows before you kick a ball what you're allowed to do.

“I think it upholds the integrity of what we do as a sport. There’s no point having a meaningless pittance of a fine or penalty if there has been a serious breach.”

The regulations do not allow for the stripping of any of Saracens’ titles, nor, the Guardian understands, will Saracens necessarily have to offload any of their current squad, because the breaches relate to investments outside the players’ official salaries.

Premiership Rugby stipulates the points deduction can only apply to this season. An appeal will take the case into the new year, but if that fails and Saracens seek to challenge the legitimacy of the cap itself, the picture would become very complicated.

A new and ugly civil war seems certain to break out, just after the private equity firm, CVC, has invested more than £200 million into the Premiership. The salary cap has a troubled history, much criticised in the past – and not just by those who believed it had no teeth. Wray himself is one of a few Premiership chairmen who have publicly criticised its very existence.

An internal crisis saw half the Premiership clubs accused of abusing the salary cap in 2007.

The accusations were not made public and no action was taken, other than to raise the cap from £2.25 million to £4 million the next season. In 2015, Saracens and Bath came to a private arrangement with Premiership Rugby for further alleged breaches.

The season before last, Wasps received a £20,264 fine for an administrative oversight that had resulted in a small overrun.

Now Premiership Rugby has imposed a swingeing sanction for the first time. This is likely to prove just the beginning of another messy saga. – Guardian