Wigan win back deducted two points as punishment for breaching cap adjusted

[Dave T]

57 minutes ago, Exiled Wiganer said:

I don't see that this highlights anything very much. In many walks of life, the sentence for a breach is proportionate to the breach in question. This is de minimis, and so the penalty takes that into account.

I know it's by the by, and I am not sure how relevant it is, but I seem to recall that Wigan were not found in breach of the rules on at least one of the previous occasions, rather we were found to have broken the spirit of the cap. If I recall, we did not actually pay more to players during the year in question, but instead negotiated reduced payments under other contracts to allow us to sign Fielden and possibly Dobson. I don't want to go over old ground, so much as to highlight that even our worst offence did not involve paying players more than the total of the cap. Instead, the deferred payments were considered even though not paid then. Here, we are talking about payments to agents, as I understand it, rather than to players.

Again I may misremember, but in Saints' de minimis case, the payments were made to players, but that was because of bonuses triggered because of players earning international caps. Which distorts the cap because these are actual payments to players, while being entirely understandable and aguably forgivable because of the greater good.

Finally, we may have teams in both France and Canada next year. The cap takes no account of the cost of living in a country (though I appreciate it may be a while before the Toronto team are Canada based), or relative tax rates. Thus 100k may go a lot further in the South of Frnace and a lot less far in London than in Wigan. Moreover, when players were paid under "tax efficient" image rights schemes, that 100k could be worth 10s of thousands more to some players than others. (I always wondered what happened to prior year salary cap reviews when those schemes were reopened, as it is often the case that the club would at least share the hit of the scheme falling over).

I can see the logic behind it, but it is a minefield. 

I'm not sure you will get much credit for not actually breaching the cap by asking players to forego wages until the next year.

[Cheshire Setter]

1 hour ago, Rupert Prince said:

Fair comment, but...  The rules are or can be complex.  Players come off the Cap for injuries. Look at the "excuses" Saints  made. Etc. 

Generally I think clubs simply make mistakes.

I suppose the other main reason for the cap that I neglected to mention is that it’s intended to stop clubs spending over the odds to buy a competitive squad and going out of business.

I wonder if there is any value in a cap that is based as a percentage of a club’s previous year’s income (or the year before if that doesn’t fit around the tax year and accounting).   That would allow the bigger clubs to take risks they can afford to on higher-profile signings, whilst the smaller clubs would remain protected.

Interestingly enough, the last couple of years has shown that the reputation of squads with the ‘big-name’ players and internationals hasn’t necessarily been reflected in the league positions.   The main prize has still been pretty much Leeds’ and Wigan’s of course.

 

[Exiled Wiganer]

1 hour ago, Dave T said:

I'm not sure you will get much credit for not actually breaching the cap by asking players to forego wages until the next year.

I am not suggesting wigan should not have been punished, rather that the they did not breach the actual cap rules. The foregone wages would have counted in the subsequent year, so there was no question of double counting. As a matter of fact, they did not spend more on players in the period in question. 

I have no first hand experience, but have spoken with lawyers who acted on 2 of the most high profile cap breach cases, for different clubs, and they had a couple of observations in common which struck me as interesting. First, that there were so many loopholes and points open to interpretation that a club looking deliberately to breach the principle behind the cap could do so with ease (and indeed some clubs were very good indeed at gaming the system). Plus, most of the clubs, including those penalised, do buy into the principle and try to comply, but fall short either through misunderstandings or incompetence. 

[Dave T]

30 minutes ago, Exiled Wiganer said:

I am not suggesting wigan should not have been punished, rather that the they did not breach the actual cap rules. The foregone wages would have counted in the subsequent year, so there was no question of double counting. As a matter of fact, they did not spend more on players in the period in question. 

But the issue with that is that they had to defer wages to prevent them overspending. If you are up to your limit, I think it is pretty clear that you can't just sign more players and ask some to work for free so you don't overspend. Even if they were paid the following Jan, they were getting paid for that previous year. It is pretty easy to see why they were hit for that. 

I don't doubt any of your 2nd paragraph at all. There is a bit of a kick off in RU at the moment, although it doesn't surprise me over there that they care little for rules, but it will be interesting to see what comes out of it.

[Hemi4561]

5 hours ago, Davo5 said:

Investigate the RFL for incompetence,that would be one he'll of a long process.

It would take a nanosecond and we all know what the verdict would be. 

[Padge]

8 hours ago, Dave T said:

Didn't the Salford ruling get released in detail by the independent panel? My memory may be playing tricks but I thought there was an awful lot of detail released.

Isn't it normal practice for this sort of thing that they release a summary first followed by a full adjudication.

[Padge]

1 hour ago, Dave T said:

But the issue with that is that they had to defer wages to prevent them overspending. If you are up to your limit, I think it is pretty clear that you can't just sign more players and ask some to work for free so you don't overspend. Even if they were paid the following Jan, they were getting paid for that previous year. It is pretty easy to see why they were hit for that. 

I don't doubt any of your 2nd paragraph at all. There is a bit of a kick off in RU at the moment, although it doesn't surprise me over there that they care little for rules, but it will be interesting to see what comes out of it.

But the actual ruling in that case was that they had not broken the salary cap rules. Basically they had found a loophole and exploited it, which was not in the spirit of the 'cap' (not in the spirit of the operational rules is a long standing RFL catchall to cover their own backsides for something they have missed).

 

[Exiled Wiganer]

24 minutes ago, Padge said:

But the actual ruling in that case was that they had not broken the salary cap rules. Basically they had found a loophole and exploited it, which was not in the spirit of the 'cap' (not in the spirit of the operational rules is a long standing RFL catchall to cover their own backsides for something they have missed).

 

Actually, I think they were right to punish Wigan for looking to use the loophole. I have no issue with applying this principle, looked at narrowly. 

Tbh, what always most concerned me, and it ceased to apply years ago, was clubs using offshore tax dodge schemes. I know I am the only person in the world to be concerned about that, but having one club spending 1.8 m net, and another 1.2 m net massively distorted the competition for years. I have never seen anything about how the clubs were required to treat HMRC getting wise to such scams as image rights. If we were a big sport over here a journalist could have put together a good article on it. 

I should stress that I have a holier than thou attitude when it comes to avoiding tax, partly from professional experience, and appreciate one man’s avoidance is another one’s financial management. 

[Padge]

3 minutes ago, Exiled Wiganer said:

Actually, I think they were right to punish Wigan for looking to use the loophole. I have no issue with applying this principle, looked at narrowly. 

Tbh, what always most concerned me, and it ceased to apply years ago, was clubs using offshore tax dodge schemes. I know I am the only person in the world to be concerned about that, but having one club spending 1.8 m net, and another 1.2 m net massively distorted the competition for years. I have never seen anything about how the clubs were required to treat HMRC getting wise to such scams as image rights. If we were a big sport over here a journalist could have put together a good article on it. 

I should stress that I have a holier than thou attitude when it comes to avoiding tax, partly from professional experience, and appreciate one man’s avoidance is another one’s financial management. 

I wasn't saying anything about the punishment, either way. I was just setting the record straight about what Wigan were guilty of and what operational rule caught them out.

[Cheshire Setter]

43 minutes ago, Exiled Wiganer said:

I should stress that I have a holier than thou attitude when it comes to avoiding tax, partly from professional experience, and appreciate one man’s avoidance is another one’s financial management. 

I think the holier than thou attitude to avoiding tax should be that it is for the greater good.   I know that it's corrupted from the top down and the richest persons/biggest corporations are the worst offenders, but I'm still behind a tax system that should both target and reward all fairly.

The 'avoidance vs. financial management' thing for me is whether you are trying to cheat the system for personal gain without contributing fairly...   I exchange a larger chunk of my salary pre-tax into my pension, to avoid getting whacked with a higher tax rate.   The government allows this as it benefits both them and me, so I don't feel I'm trying to cheat anyone out of anything.   Pretending that a large chunk of my work is conducted offshore (which technically it is) would be a way of trying to cheat the system, because I'm home every night benefitting from all the tax that everyone else is paying...   so I shouldn't be doing that.

Ergo, the same should apply to the salary cap - abide by the rules and in the sprit of what was created to benefit the game.   We are too small for selfish acts and corruption.

[Padge]

21 minutes ago, Cheshire Setter said:

Ergo, the same should apply to the salary cap - abide by the rules and in the sprit of what was created to benefit the game.   We are too small for selfish acts and corruption.

In lots of different sections there is reference to "the spirit of the rules takes precedence over any technical aspect of the rules", that has been the operational rules and laws of the game for years and not just in RL but it is used by lots of sporting bodies.

The reason it is there is because you cannot list every possibly way that a rule can be broken. Thus Wigan broke no technical aspects of the cap and didn't pay out above it, but fell foul of the catch all spirit rule.

Maybe our tax laws should have a similar clause to stop dodgy avoidance scams.

[Cheshire Setter]

19 minutes ago, Padge said:

The reason it is there is because you cannot list every possibly way that a rule can be broken. Thus Wigan broke no technical aspects of the cap and didn't pay out above it, but fell foul of the catch all spirit rule.

Yes, it wasn't a dig at the Wigan incident - just the way I generally feel about clubs disrespecting the game (mine included if TRL's armchair cap monitors are to be believed )...