Kings crisis: SARU not out the woods yet
The Eastern Province Rugby Union – through its professional arm, EP Rugby (Pty) Ltd – last week reached an agreement with 18 players (who did not receive Super Rugby contracts) over outstanding salaries.
However, EP Rugby needs to come up with ZAR5-milliion by Sunday, January 31, or they will face liquidation.
And if they do not have enough assets and property, the players' lawyer will go after the South African Rugby Union's new Super Rugby franchise – the Southern Kings.
Craig Jessop, a labour lawyer working for the firm Brown, Braude and Vlok, confirmed to rugby365 that the players (as a collective) had originally asked for ZAR18-million, but settled on ZAR12-million.
This was made an arbitration award by retired judge Frank Kroon.
EP Rugby has remained decidedly quiet on the subject, with a terse one-line statement from EPRU President Cheeky Watson the only response so far.
"EPRU have received a signed settlement agreement from the players," Watson said in response to rugby365 enquiries, without confirming whether or not they have the available funds.
It remains unclear if EP Rugby, who have not been able to pay the salaries of staff and players since September last year, have received a cash injection from some external source.
What is clear is that the players, through their lawyers, are not backing off and have won a significant victory.
According to Jessop the players – who have not received Super Rugby contracts – cancelled their contracts and declared a dispute with EP Rugby over the unpaid salaries.
The agreement, following numerous meetings during the arbitration process, has three levels – salary arrears (since September), damages (as a result of EP Rugby's repudiation of the contracts) and accommodation costs.
"In addition to giving effect to payment of arrear salaries, EP Rugby shall pay damages to each player by way of monthly instalments for a period of five months – commencing [from the] end of February," Jessop said.
The arrears, due on Sunday, amount to ZAR5-million, while the damages are the remaining ZAR7-million of the arbitration award.
He added that monthly payment (damages) will be over a period of the five months and shall be the average of the players' salary between their 2016 rate of pay and 2017 rate of pay.
"The priority at this point is for players to continue receiving payments until June/July when the market opens for teams looking to sign players," he added.
However, should players take up contracts elsewhere before the June/July window, those earnings will be subtracted from EP Rugby's damages payout.
Given the silence of EP Rugby it is not clear if they will be able to meet the first deadline, this coming Sunday.
"If there is a breach at any stage, I will begin a process of liquidation," Jessop said.
He added that should they not get relief through the liquidation process, they could then proceed with steps against the SARU-controlled Southern Kings.
Jessop confirmed that he had already informed Southern Kings Chief Operating Officer Charl Crous (formerly EP Rugby CEO) that BBV – on behalf of the players – will look into going after the new entity.
"We have not ruled out going after SARU," he told rugby365.
By Jan de Koning
@King365ed
@rugby365com
