Contractual Obligation

I was going to write something a while back on the Cristiano Ronaldo saga at Manchester United. For those of you who aren’t fans of the “Red Devils” or the “Beautiful Game” – so aren’t au fait with the situation – Cristiano Ronaldo is the biggest, brightest, best superstar playing for arguably the biggest, brightest, best club in the world (well they’re European Champions, and back-to-back winners of the world’s best football league). The problem is, Cristiano doesn’t see things this way – he’d rather play for glamour club Real Madrid. Real pay their stars exorbitant wages and don’t really win anything – but they go into massive debt to buy players and mercilessly exploit their image rights to pay the interest. But I digress. Cristiano’s problem is that he signed a five year contract with Manchester United pretty recently. In the murky world of Football politics and contractual law – clubs can sell contracted players for “transfer fees” – essentially the longer the contract the higher the fee the club can receive. In fact, players can move clubs for free at the end of contracts (and sign with new clubs on free transfers in the final year of their contract with the transfer taking place upon expiry). It’s in the best interest of the club to sign players up for long term deals. Wage structures in these contracts often reflect “potential value” rather than actual. So a young player is offered a contract with a lot of zeros because the club wants to keep them for a long time – and if they see a chance to sell their star they get the best possible price.

The integrity of contracts is fundamentally important to the commercial survival of clubs. Some clubs in England survive, financially and competitively, by buying and developing young talent and onselling them to the top clubs at a profit. Sonny Bill Williams decision to disregard his contract with the Bulldogs has brought the contractual argument into the world of Rugby League. His case is distinct from the round ball game, and from Cristiano Ronaldo’s situation – in that he is switching across codes – rather than within a code. League also doesn’t have a transfer fee system, and it has a salary cap – which football (in the literary and global sense) doesn’t.

My take on both situations is that these players are being led astray by greedy “sports agents” – the antithesis to Jerry McGuire. Agents benefit greatly when their charges sign new contracts – they get massive commissions – 10% in the case of Cristiano Ronaldo’s proposed deal. They’re like leeches. They also are the ones that broker the legal side of sport’s contracts – and they advise their clients to sign on when perhaps it’s not in their best interest to do so.

A contract is a contract – and, sports clubs, and governing body such as the NRL – have every right to expect they be honoured. The FIFA (the global football body) President, who nobody really likes, came out and basically said Ronaldo (who is on millions of pounds per year) is essentially being treated as a slave – not particularly helpful (or politically correct) stuff from someone who is meant to be the game’s senior figure. NRL CEO David Gallop has been much more statesmanlike in his handling of the SBW situation. Although Gus Gould gave him a bit of a roasting for pretty much overseeing the death of Rugby League as we know it. I’d be interested to hear other people’s thoughts on what this means for the game.

My friend Ben seems pretty convinced that the NRL needs to shrink (number of clubs) and expand (nationwide) which has been one option suggested by a few people. That’s probably an unfair summary of his argument – but I think he’ll email me to clarify when he’s read this, so I’ll leave it as is.


Nathan says:

This story has some interesting further points to make on the situation – and looks at some similar historical “groundbreaking” cases.

Leah Maria says:

I won’t miss Sonny Bill Williams either.

Not to mention, I don’t see how on earth he thinks he’s going to get himself out of this one. He signed a contract and then bolts… the loophole is where??