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The writing is on the wall for restrictive trade rules

Roar Guru
2nd December, 2008
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Collingwood's Nathan Brown tackles St Kilda's Stephen Milne during the AFL Round 19 match between the Collingwood Magpies and the St Kilda Saints at the MCG. GSP Images

The outcome of the national draft last weekend has pinpointed the need for drastic changes to the AFL’s rules restricting players’ movements between clubs. Only four of the 79 draft selections involved players who wanted to switch clubs, making only a total of ten when added to the six who were able to find new homes through the October trade week.

And it appears that only two or three more will picked up in the pre-season draft the week after next.

As Stephen Rielly put it The Australian on Tuesday, “it has become nigh on impossible to switch from one club to another through a trade, as Ryan O’Keefe [Sydney] and Brad Green [Melbourne] most recently discovered to their chagrin.”

The AFL Players Association’s chief executive Brendon Gale was quick to agree the next day, lamenting that the movement of listed players “has almost ground to a halt.”

Gale told Rielly there had been “a number of situations where experienced, professional players for a variety of reasons wanted to play somewhere else, but were deprived of the opportunity to do so,” and that the system was doing little more than encouraging a disgruntled player to challenge it.

Gale is right. The only wonder is that this hasn’t happened already.

There are three main planks to the AFL’s player-movement system: the draft in its various forms, the salary cap, and the restrictions on movement by players who have fulfilled their contracts.

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All three are restrictions on trade, but there are some sound reasons for the draft and salary cap to exist, such as maintaining an even competition and not allowing the richest clubs to squeeze the poorer ones out of having any chances of success.

You only have to look at the Premier League in England, where four clubs have dominated the scene for years and look like continuing to do so in an environment where there is no draft and no salary cap.

The third factor, though, is a vastly different kettle of fish, involving, as it does, the inability of players to take their services elsewhere once their contracts have expired.

This would almost certainly be overturned in the courts if challenged.

The High Court ruled, in the Tutty case 37 years ago, that such a system was an unlawful restraint of trade.

The NSW Rugby League’s rules at the time said, among other things: “A player who signs as a professional player should note carefully that he is in effect tied to his Club and cannot subsequently sign for any other club unless he is released – either by transfer or by the club agreeing to strike his name from their list of registered players.”

That’s not too far away from the present situation in the AFL, which requires an out-of-contract player who wants to move to go through the trade week process or register for the draft.

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He can’t take his services to another club of his choice, as rugby league players are now able to do, although the clubs they go to still have to observe the salary cap to accommodate them.

The High Court ruled in the Tutty case that it was “contrary to the public welfare that a man should unreasonably be prevented from earning his living in whatever lawful way he chooses and that the public should unreasonably be deprived of the services of a man prepared to engage in employment. It would indeed be a strange weakness in the law if it afforded no protection to a person who was against his will subjected in fact to an unreasonable restraint of trade.”

The five judges concluded: “In our opinion the rules now under consideration go beyond what is reasonable in two main respects. In the first place, they enable a club to prevent any professional who has played in one of [the NSWRL’s] teams from playing with another club, notwithstanding that he has ceased to play for the club which retains him and no longer receives any remuneration from that club.”

It’s highly unlikely that the AFLPA itself will cut off its nose to spite its face by mounting a legal challenge to the system, which means it will be up to an individual disaffected player to do so unless he finds a friendly, cheap legal team, as there are serious financial implications in the unlikely event of a loss.

Which is why the AFL has been immune from challenge so far.

And even winning isn’t without its downside, as Dennis Tutty told me a few years after his win.

“The only real winners are the lawyers, mate,” he said.

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