The AFL has plenty more than a trophy at stake in 2016

How much will the AFL’s players get paid with the new broadcast agreement coming into effect in 2017? When will players qualify for free agency? Should draftees be tied to their first club for longer? Will there be a player-driven lock out?

It’s time for the AFL’s new collective bargaining agreement to be negotiated, and you need to know what’s at stake, because there’s plenty.

Why aren’t we talking about this?

You’d be forgiven for thinking the only thing on the AFL Players Association’s mind right now was the Swiss legal system. For the League’s 780 other players, there’s something far more important happening this year – something that has the potential to reshape the game we love.

A quick browse of www.aflplayers.com.au reveals the AFL Players Association (AFLPA), led by ex-Australian cricketers union chief Paul Marsh, has been talking an awful lot about the Essendon situation in recent months. In fact, outside of the thoughts of AFL players on the upcoming fantasy season and Super Bowl 50 predictions, that’s about all they’ve spoken about or written about in a public setting in 2016.

Sure, it’s the AFLPA’s job to ensure that its players receive a fair hearing when legal matters arise, but when it comes down to it, the Association is there to represent all AFL players. And wouldn’t you know it, there’s something incredibly, remarkable, earth-shatteringly important that affects every single AFL player, past, present and future, that one would hope is front and centre at 170 Bridgeport St in Albert Park.

No, it’s not the Essendon situation. And no, it’s not the terribly designed, near-unusable AFLPA website. It’s the re-negotiation of the collective bargaining agreement (CBA) between the AFL players and the AFL.

What is the CBA? I would call it one of the most important document in the AFL, perhaps third behind the AFL Laws of the Game Charter, and the rule book itself. The CBA sets the parameters for everything, from how much players are paid, how they are listed and delisted, how they are traded, general working conditions, health and safety, and everything in between. Everything else – including any financial policies like equalisation – that happens in the AFL hangs off of this document.

There’s not a lot of time to do Industrial Relations 101, so please take my word for it: this thing is incredibly important. Not just for the players it covers, or the clubs it regulates, or the league in which these two spheres interact: it affects everyone and everything in the AFL.

No, it’s not the Essendon situation. And no, it’s not the terribly designed, near-unusable AFLPA website. It’s the re-negotiation of the collective bargaining agreement (CBA) between the AFL players and the AFL.

You can get your own copy of the CBA here.

The current CBA had an original term of 2012 to 2016, but was renegotiated following a standard mid-term review, after it became evident that the AFL’s financial health was a little stronger than anticipated. That’s the version of the document linked above. The 2014 deal, which came into effect in 2015, sets the current rules of the game, and one of those rules is that the CBA is to be re-negotiated in time to come into effect on 1 November 2016. In order for that to happen, the CBA states that negotiations for a new agreement should be complete by 30 June.

That’s four and a half months away, people. And as above, there has been nary a public peep out of the AFLPA on this baby since AFLPA president Matthew Pavlich spoke to the media following a December delegates meeting. There was no great revelation from Pavlich’s interview, but it did shed some light on the issues the players would seek to focus on in the coming negotiations.

Given 30 June is getting rather close, here are the biggest issues at play in the CBA, and some suggestions of what might happen from here.

But first, a step back and look at what happened the last time the full CBA was up for negotiation.

It’s getting hot in here

The 2011 negotiation period was a rock fight, plain and simple. The AFLPA, then headed up by current St Kilda CEO Matt Finnis, pushed for a significant increase in pay and an expansion in player entitlements, and did so incredibly hard. The AFL had just negotiated what was a record $1.253 billion over five years television rights deal, and the AFLPA wanted its players to receive a jump in pay in line with that. The League didn’t want a bar of it.

A lot of that was likely negotiating tactics. No one ever enters a negotiation putting their final figure on the table – you always go far higher or lower, depending on which side you’re on, knowing full well that’s what your opponent will do. But a lot of it wasn’t too, particularly on the AFL’s side, given many Victorian clubs were in trouble financially at the time, and weren’t confident of being able to meet the new salary benchmarks the AFLPA was seeking without making large losses.

The biggest point of difference emerged as the players called for a fixed share of the League’s revenue, as it is in a number of global sports. Initially, the players wanted 27 per cent of the AFL’s total revenue – club land and central command – made available for the players, to be used in a number of different ways. The lion’s share of that would go to player salaries, but it would also include education and training, health and welfare, and post-career support and funding.

HQ wouldn’t budge on this particular point, and the players eventually gave in, instead settling for fixed annual percentage increases in the game’s salary cap, known as Total Player Payments, or TPP. Those increases were quite run-of-the-mill in the end, with an initial seven per cent bump proceeded by four per cent, 5.4 per cent, three per cent and three per cent. 2014’s mid-term review saw that 2015 increase bumped up to 4.6 per cent.

The pattern was almost identical to the previous CBA, despite the surge in broadcast revenue. The AFL’s revenue increased by almost 25 per cent in 2012, the year that the new CBA kicked into effect and the players received a seven per cent increase.

So, the two sides were quite a way apart in that respect, and things started to get ugly towards the middle of the 2011 season. How serious did it get? There was open talk that the AFL players would boycott the International Rules series of that year, and potentially the NAB Cup too, as a way of “voicing their displeasure” at the holdouts at League HQ.

There couldn’t be a lock out, could there?

No games were lost, with the AFLPA and AFL coming to an agreement. However, the spectre of boycotts always looms large over these kinds of negotiations. Look no further than the NBA and NHL in the United States, where labour agreement delays have led to lost games as recently as 2013. The entire 2004-05 season of the NHL was canned as a result of an impasse between the buyers and sellers of ice hockey labour.

Those examples are in the hyper-commercial American sporting leagues. We’re a bit more egalitarian over here, and so the prospect of any actual “lost” games is incredibly remote. But, it is worth keeping it at the back of our collective minds; the AFLPA is, after all, a union that exists to protect the interests of its players, and just like in a more traditional workplace one of the options available to the AFL players is strike action.

It’s important to point out at this point that the current CBA states that if a new agreement is not struck, the current CBA will remain in effect until such time that a new agreement is made. That would mean everything is frozen at 2016 levels, despite the surge in revenue about to flow the way of the AFL. The players won’t allow that to happen.

Show us the money

Which is a nice segue into the key issues at play in the 2017 agreement. The biggest one is the most obvious: just how high will the AFL allow the TPP cap to rise?

In case you missed it last year, the AFL and its broadcast partners re-upped the League’s broadcast contract to an unthinkable $2.508 billion over six years from 2017, up from what was an already remarkable $1.253 million over five years from 2012 to 2016. That’s an increase from $250 million per year to $417 million per year, or a 67 per cent increase. To put this number into context, in 2014, the AFL earned $458 million in revenue for everything it does, including the circa $250 million of broadcast agreement money.

What could the League’s central pot grow to in 2017? One would think $600 million is not out of the question, and indeed that is probably a conservative estimate. The AFL has kept around 30 per cent of this revenue to fund its own operations in the past decade, distributing the rest to the AFLPA, the clubs, and other strategic projects.

Speculation as to what the League might spend its new riches on is rife. The first item on the AFL’s list is to untangle the Christmas lights that make up its financial equalisation/competitive balance policy. That itself is worth far more time that we can dedicate here, but be advised that the league will be mostly ripping up and redrawing its financial relationship with and among the clubs before the year is out.

Notwithstanding, the players will want a fair slice of the AFL’s newfound riches, given they, for all intents and purposes, missed out on a big pay rise under the last rights agreement.

We do know that the AFLPA will pursue the fixed share of the pie line of argument once again, which has already been largely dismissed by Gil McLachlan. If that’s off the table, what could the players reasonably expect to achieve as far as a new TPP limit is concerned?

The players will want a fair slice of the AFL’s newfound riches, given they, for all intents and purposes, missed out on a big pay rise under the last rights agreement.

Historically, the league-wide TPP figure has been equal to around 40 per cent of the AFL’s central revenue pot – the two aren’t related directly, that’s just what the numbers show when compared. In recent years, that figure has dropped to below 37 per cent, in a sign that player salaries are perhaps not keeping pace with top line growth across the league in recent years. We will get an update on this number towards the end of March, when the AFL’s 2015 annual report is released.

I’m hesitant to put a number out there, because so much is up in the air with regards to club finances, which are arguably a more important consideration to this discussion that the financial health of the league as an entity. But under a ceteris paribus scenario, assuming that the only thing that changes in the AFL’s top line revenue grows by $160 million in 2017 and it distributes funds in precisely the same portions that it did according to its 2014 annual report, we may expect the TPP cap to rise to just shy of $15 million in 2017, and head towards $18 million by the end of the CBA.

A cap jump like that, from the $10.4 million in 2016 to $15 million in 2017, is simply not going to happen.

Clubs would have been planning around an increase, but a surge of that magnitude would wreak untold havoc on the league. Players would begin breaking deals and looking for a big increase in their pay, while those with the luck – dumb luck or the kind that comes to those that are good at predicting the future – who come out of contract this year would do so with an unprecedented increase in cash available to them.

What is far more likely is a gradual increase, stretched over the life of the new agreement, which smooths out any prospective pay day that the players can expect to receive. Sure, there’ll be a large increase in the first year, but perhaps something closer to the seven per cent which has been granted in the first year of the past two agreements.

That all remains up in the air, though, given we’re working on old AFL numbers right now.

Disequal distribution

What we do know is that it’s a great time to be an AFL player. Or is it?

Last week, a summary report of 2015’s final TPP data was released by the AFL. The headlines, quite predictably, focussed on working out who the two highest paid players, who earned $1.2 million or more last season, were. But the data were far more interesting once the shiny-looking surface is breached.

Listed players took home an average of $302,104 in 2015, up from $237,388 at the end of the last CBA. That’s an increase of 27 per cent, which is higher than the increase in TPP (23 per cent). This is quite revealing, and sets up an interesting little dilemma for the AFLPA in the upcoming negotiations.

There has been an almost-near total eradication of sub-six digit earners under this new agreement, which would be a product of increased draft salaries and a lift in the base payment for rookies instituted in the 2012 agreement. However, that appears to have come at the expense of broadbased growth in player salaries, with those in the middle bearing the brunt.

For you see, the average player salary has grown faster than the overall TPP limit for one reason, and one sub-reason: there has been a veritable explosion in players earning $500,000 per year or more, likely enabled in large part by a surge in the value of additional service agreements (ASAs) entered into by established AFL players, particularly in 2015.

At the end of the last CBA, the majority of AFL players earned less than $200,000 per annum. A slightly smaller proportion earned between $200,000 and $500,000, and a small share – less than six per cent, or just 40 players – earned half a million dollars or more. At the end of 2015, just over a third of listed players earned $200,000 or less, half earned between $200,000 and $500,000, and a significantly larger 13 per cent of players took home $500,000 or more.

The median salary for an AFL players has remained in the $200,000 to $300,000 bracket for the past five years, despite an increase in the average salary to above $300,000. In essence, the current AFL CBA has enabled the very best, highest value AFL players to increase their salaries at a disproportionate rate to the rest of the competition. The lot of a middle-of-the-rung player has remained largely unchanged over the past five years, at least as far as take home pay is concerned.

This is an interesting tension within the AFLPA, given it exists to represent the interests of all AFL players, the vast majority of which aren’t 250-game stars. However, the majority of AFLPA delegates are established AFL players, not the run-of-the-mill types.

In essence, the current AFL CBA has enabled the very best, highest value AFL players to increase their salaries at a disproportionate rate to the rest of the competition

Meanwhile, 2015 was the first time in at least nine years that AFL players as a group earned more than the collective ASA allowance permissible under the CBA. The CBA states that AFL players can earn up to $992,000 worth of ASAs outside of the TPP cap, with any income earned about that amount counting towards the cap. Last season, AFL players were paid a total of $18.6 million in ASAs, which is above the threshold of $17.9 million. That’s an aggregate figure, so it doesn’t reveal whether five clubs were over their individual club threshold, or 10, or indeed just one.

This is another dilemma for the AFLPA, because all things being equal, it’s the star players that are already earning good money by virtue of their standard of play that draw the attention of companies looking to spruik their products. While it’s the first year that it’s occurred, that the ASA limit has been breached would mean there is slightly less money to go around for standard contract payments for players, and it’s those middle class players that would again bear the brunt of this.

Is there a solution? Not without introducing all sorts of crazy salary cap mechanics like those which exist in the NBA. There are means and ways to make middle class players seem more attractive, by adding bells and whistles to their salaries like traded salary exceptions or deferred free agency rights. But, this would be counter to the goals of the AFL’s competitive balance policy, which is attempting to strip all sorts of complexities out of the current salary cap arrangements – to great effect at this point.

So instead, what’s likely to occur is that the mostly free market approach to salary setting continues, which means clubs are free to lavish their star players with more and more lucrative contracts. That puts pressure on the middle class, given salaries at those lower levels are largely fixed.

Turn up the (entry) level

Another point of discussion may be how the league treats its youngsters and fringe players, namely draftees and rookie listed players.

Let’s deal with rookies first. The vast majority of AFL players are fully listed players, however there are 106 rookie-listed players this season, most of whom have spent their AFL careers on the fringes of lists, or plugging away at lower levels.

These players earn a relative pittance, with a minimum salary of $57,940 available to them in the 2016 year. Clubs can pay their rookies whatever they’d like – including match payments, bonuses, incentives and the like – but given rookies are mostly the last dog at the bowl when it comes to list management, one would expect the vast majority earn at or around that minimum figure.

That seems a comparative pittance for players that arguably work harder, and suffer more hardships, than their more highly-paid, highly-skilled counterparts. Rookies are, by their very definition in the AFL, fringe dwellers, and are likely made more so by their low pay.

Would an extra ten, or even 20, on the base figure for a rookie contract break the bank? Given most clubs have five or six on their list, we’re talking an extra $60,000 to $120,000 to make the wages of rookie listed players more liveable break the AFL’s collective bank?

The AFLPA managed to argue for a strong lift in both draftee and rookie pay – the latter of which was very close to the minimum wage – as part of the last CBA. More could certainly be done to help the rookies out.

JacobWeitering

Draft class warfare

All players taken in the AFL draft receive automatic two-year contracts, with fixed retainers, match payments and bonuses for total matches played that are defined in the CBA. There are three bands for the retainer: first round, second round, and third and subsequent rounds; draftees taken in the first round receive the highest retainer and third and lower rounds receive the lowest. Match payments and bonuses are the same regardless of position.

A player taken in the first round – let’s use Jacob Weitering as the example – could earn $175,490 if he plays the full 22-game season, $74,740 of which is a retainer, $80,520 of which is match payments ($3,660 per game) and $10,230 in a bonus for playing more than 10 games. Weitering also received a one-off bonus of $10,000 for being taken at number one, but also has additional media commitments that others draftees don’t. I don’t know about you, but I wasn’t earning $170,000 as an 18-year-old.

It sounds great, but not everyone is a first-round pick, nor will play a full year in their first season. The 70th overall pick in last year’s draft, Matthew Hayball, may earn $64,395 for the year, 100 per cent of which is his contract retainer. That’s assuming Geelong didn’t pull the wool over everybody’s eyes and uncovered another Paul Williams.

Second-year players get a pay rise, based on the position they were taken in the draft and the number of games they played in their debut year. However, they don’t receive a bonus for the number of games they play in their second year. Weitering would see his retainer bump up to $98,105, and his match payments to $5,305. Assuming he once again plays 22 games, his salary would increase to $214,815. Hayball, by contrast, could expect to earn $71,390.

This is in addition to allowances for moving expenses, tools of trade, and any ASA money that the club may wish to arrange for their youngsters.

With a salary cap of about $10 million per annum, those numbers look about par to me. An elite youngster can expect to become a very well paid individual (and take up about two per cent of his club’s salary cap) very early in their career, while someone who is good enough to be drafted can still pocket a decent salary – which is more than many full time professions pay – while they’re taking a shot at making it as an AFL player.

There likely won’t be a step change increase in draftee salaries in the upcoming CBA. But one issue that could be up for debate is the length of draftee contracts.

Lock ’em up

As above, draftees are awarded a fully guaranteed two-year contract with their new club. For most, this means they sign their deal as an 18-year-old, and are due a new contract by the time they’re the grand old age of 20. At this point, it’s nigh on impossible for a club to truly know what they have.

Nat Fyfe, taken in the second round of the 2009 draft, didn’t look like the footballing Jesus at the conclusion of his second year. Sure he looked like a potential star, but it took until July of his second year for the Dockers and he to agree to a two-year extension. Jesse Hogan was taken in the GWS mini-draft, effectively considered a member of the 2013 draft crop. He didn’t get on the park until the 2015 season, with the Demons having to lob him a new contract in 2014 to keep potential rivals from pinching him before they knew what they had.

The initial contract window in the AFL is quite short compared to international sports that have drafts, too. In the NBA, rookies are tied to their team for a minimum of two years, with clubs holding third and fourth year option rights which they must exercise at the end of their draftee’s second year.

In Major League Baseball, teams hold the rights to their players for up to eight years, while in the NFL… actually let’s not do anything like they do in the NFL.

Despite this, a number of clubs choose to sign their players up to longer-term agreements early, sometimes before they’ve even played a game. So far this year, two players have signed extensions to their draft contracts, and there’ve been many more in recent years. The most high profile and controversial of these has been GWS Giant Cam McCarthy, who is presumably in his native Western Australia right now on personal leave.

As we have seen in recent trade periods, players are beginning to exert their influence on the clubs in a more concerted fashion. The Cam McCarthy situation is the text book case of this. Can, or should, the clubs argue the case for an extra year on draft contracts?

Cam McCarthy Cameron McCarthy Greater Western Sydney Giants GWS Giants AFL 2015

A disappointed Cam McCarthy of the Giants as the Swans celebrate a goal by James Rose during the Round 21 AFL match between the Sydney Swans and the GWS Giants at Spotless Stadium in Sydney, Saturday, Aug. 22, 2015. (AAP Image/Dean Lewins)

This would have benefits for everyone. It would allow the clubs to have their coveted youngsters for an extra year of growth and development, at a cost controlled rate. The clubs would be in a position to know their draftees better, and give them greater opportunities. For the players, particularly those that are on the edge of retention or abandonment at the end of their second year, they get an extra 12 months to prove they can make it at this level – either at their current club or a new one.

The AFLPA may argue it precludes the better players making more money, earlier, and that’s likely the case. However, the best players will still realise their value. This would help the 90 per cent of its constituency that doesn’t have a long, storied career. Besides, the bigger prize from the AFLPA’s perspective isn’t draft contracts, it’s free agency.

Let the market decide

Free agency came into play in the AFL in the 2012 off season. Since its inception, 49 players have moved clubs using the mechanism – around 14 a year – the majority of these as delisted free agents. These are players that would have otherwise had to enter the pre-season draft to continue their careers, which seems archaic. A further 15 players have moved clubs as unrestricted free agents, and the balance (11) as restricted.

We don’t have the space to run through the specifics of each category means right now – there’s an excellent primer on the AFL’s website if you’re keen.

A player earns restricted free agency rights after eight seasons, and unrestricted free agency rights after ten years. An unrestricted free agent is a true free agent; free to move wherever they like. There are some cases where a player can become an unrestricted free agent earlier, but these do not occur often. The club of a restricted free agent holds the right to re-sign a player if they want to match the free agency offer that another club lodges – no club has chosen to do that in the four years of free agency.

Free agency has been a contentious issue since its inception. AFL football, for better or worse, has a bucket load of traditionalists and conservatives that don’t like the idea of players choosing their professional destiny. Some of this controversy is understandable, if not justified: James Frawley’s move to Hawthorn was a masterstroke on behalf of the Hawks, as they were able to pinch a very good player at the most shallow position in the league without having to give up anything but salary cap space.

The debate around free agency seems to centre on the old versus the new: loyalty versus business. This is an immature view, for mine, and it ignores what this and other player movement reforms achieve. As I argued when the AFL introduced future picks trading last year, initiatives to help grease the player movement wheels help even out the distribution of talent so long as there is a salary cap system in place.

Freer player movement has been on the AFLPA’s agenda forever; the introduction of free agency in 2012 was the result of many years of negotiation and lobbying, and it took two full years from agreement to implementation. I expect this to be a hot button issue once again.

In fact, we already know that it will be. Earlier this week, the Herald Sun reported that the AFLPA was pushing hard for free agency to kick in earlier in a player’s career. Under their proposal, restricted free agency would kick in at the six year mark, and unrestricted free agency at eight, down from the 8/10 model that’s in play now.

As it stands, very few players make it to unrestricted free agency; only those who are great have careers that are that long. In the view of the AFLPA, it kicks in far too late to be of any practical use. Meanwhile, restricted free agency is mostly a redundant concept, as evidenced by the Patrick Dangerfield situation last year, largely in my mind because of the long service limit.

Patrick Dangerfield looks on (Photo: AAP)

Patrick Dangerfield looks on (Photo: AAP)

There’s something of a quid pro quo here: clubs may be reluctant to allow players they enjoy the company of to attain free agency status earlier in their careers, but I bet they’d like to hold onto their youngsters on cost controlled deals for an extra year. The AFLPA wouldn’t want its players tied to below market value deals for longer than they are now, but earlier free agency would help the best earn more, earlier.

These two issues may not be discussed in the same context, but they are both likely to be on the table come the middle of the year. If I were a betting man I’d say the free agency service requirements are more likely to fall than the tenor of draft contracts rise, though.

The AFL’s free agency mechanism is not included in the current CBA, which seems something of a misnomer, and that will surely be addressed in the new agreement. However, the current CBA does refer to a working party that is discussing potential changes to free agency right now, and which is expected to report to the AFL and AFLPA at the end of the month.

That could kick CBA discussions off in earnest.

Rapid fire round

That’s a wrap of the biggest issues at play. But as ever, there’s more. Here’s a quick list of other things that will be up for discussion in the coming months.

• Under the current CBA, there is an ASA cap which exists outside of the TPP cap. This cap, set at $1.02 million in 2016, is a soft cap in so far as clubs are free to breach it if they wish. However, any ASA income paid above that threshold is counted towards TPP. The ASA cap is currently around 10 per cent of the TPP cap, up from seven per cent under the last agreement. Footy is only getting bigger and bigger, and the tension for the value of commercial endorsements to grow is large.

• Health and safety, player welfare, and education are likely to be big issues for the players – you can never have enough of any of these things these days. The question will come down to who foots the bill? The AFL? Clubs? Or players, in the form of a reduced salary increase?

• AFL clubs are required to lodge all player contracts with the AFLPA and the AFL itself. Both organisations are sitting on a goldmine of information; that information is kept almost completely hidden. I’d personally like to see more transparency, but the AFLPA and the players are dead against their salaries being published.

• Players currently hold absolute veto rights over any potential trade, which is a quaint feature of our domestic football league. Most, if not all, other major sporting codes around the world put trade powers firmly in the hands of the clubs. Some leagues, such as the NBA, allow their players to negotiate “no trade” clauses with their clubs directly as part of contract negotiations. It’s something worth mulling over when the free agency discussion ratchets up in a few weeks’ time.

• There’s been many positive steps taken to address player welfare and finances in retirement, but like education more can always be done. The AFL players’ superannuation fund is a defined benefit scheme, and requires ongoing subsidies from the AFL to remain fully viable. A big pay day is a great time to settle debts for organisations in the same way it is for individuals.

• The other major post playing career issue facing the AFL is long term illness and injury, namely the potential impact of head knocks and concussions, and just how liable the AFL and its clubs should be for medical treatment. The CBA does deal with this, but in a mostly short term manner. Expect this to be front and centre, with both parties keen to ensure retired players are better taken care of.

• Last time around, the clubs and AFLPA got into an argument over whether players should be guaranteed single rooms when travelling to play. The clubs felt this was an unnecessary financial burden, while the AFLPA thought twin rooms were a little passé. The matter remains unsolved, with the right to a single room not fully guaranteed by the CBA.

• Finally, one that I haven’t yet had the dual pleasure and burden of dealing with: player access. The AFL media complain consistently about the inability to get access to players and coaches. This is all governed by incredibly burdensome – in a relative sense – administration arrangements included in the CBA. This, again, seems somewhat archaic. Will the AFLPA come to the party and improve player access? Probably not. There’s plenty to discuss in the coming months, after all.

Comments (40)

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  • Samantha said | February 17th 2016 @ 6:46am

    For the good of the game, both clubs and players, there must be some sort of balance found regarding player movement. The players absolutely hold 100% of the power. It’s not healthy. The reason why free agency has worked for American and other off-shores sports, is because of the checks and balances inherent in the system. The AFL system, quite frankly, has none of these.
    In the AFL the ‘destination’ clubs will by design benefit the most from free agency as in demand players look to those clubs for career success. This in effect creates an atmosphere of the rich getting richer.
    The way this is balanced out in other sports is teams with players about to enter free agency (and who they likely can’t or won’t re-resign) can be traded. These ‘rental’ players typically get traded to fringe contenders looking to boost their chances of either making post-season or surviving deeper into post-season. The club that trades the player gets the benefit of gaining whatever they traded the player for (usually draft picks and young players).
    So the benefits break down to:
    1. Teams don’t need to lose a pending free agent for nothing.
    2. Contending teams can make a stronger push into the post-season by potentially filling holes in their lists.
    3. Pending free agents get to see what life is like outside the single club they ‘grew up in’, better preparing them for the next stage of their careers, while also generally moving to a team with a chance at playing post-season.

    It’s a win-win-win situation, that provides a nice balance to free agency, but sadly will never happen in the AFL. In order for it to happen the AFL players would need to give up thier absolute right to veto any trade and the AFL would have to allow in season trading. Neither of which I see the power hungry willing to give up, despite it obvious advantages to all involved.

    • Ryan Buckland said | February 17th 2016 @ 10:16am

      The trade veto is, as I say in the piece, a very quaint concept. Players have the power, and will get more power if free agency changes along the lines I expect. Players should be free to negotiate no trade clauses, but I don’t think it should be a basic right governef by the CBA.

      • Samantha said | February 17th 2016 @ 10:30am

        Agreed. Players have all the power when they are out of contract, they shouldn’t have all the power when they are contracted as well. The way things are going being contracted isn’t much of a deterrent for most players to get whatever they want. Contracted players should not be allowed to dictate what club(s) they can be traded to. Either honour your contract, or, if you your situation is truly unbearable where you are, ask for a trade, but your current club gets to decide what works best for them. There should be a risk to being asked to be traded.
        Free agency compensation also needs to be scraped. It’s not ‘free’ if it costs 17 other clubs draft positions. At the very least if compensation is absolutely necessary clubs should be required to tender some sort of qualifying offer (how this would work is a subject for another time). Clubs who make zero effort to retain a player deserve zero ‘reward’. The whole idea of letting a player walk because the ‘compensation’ is better than the player is anathemic to free agency.

        • Brian said | February 17th 2016 @ 1:08pm

          Agree on free agency compensation. It encourages player movement which encourages players agents making money.

          Ideally the players should give up that right in exchange for more overall pay. 27% is reasonable. Once can only wonder how much waste there is in the remaining 73%.

          I don’t agree on in-season trading except for a unique Giles at Essendon type situation.

  • AR said | February 17th 2016 @ 7:22am

    Seriously good work Ryan.

    • Ryan Buckland said | February 17th 2016 @ 10:17am

      Thanks AR, I’ve been wanting to write something deep on this for quite some time now. I’m glad you enjoyed it!

  • TomC said | February 17th 2016 @ 9:50am

    This is brilliant. Thanks very much Ryan. A fantastic read.

    Two things I’d like to challenge:

    Firstly, while the rules around restricted free agency doesn’t get exercised often in public, I doubt it is a redundant concept in practice. Negotiations occur in private for months or even years before a player can acceptably announce that they’re exercising free agency; if a club has decided to match a rival offer then there’s no point in a player announcing that they were going to leave otherwise.

    But player managers would certainly try to use that tool to leverage higher salaries from their clients’ current clubs. I suspect – although I have no way of knowing – that it creates an inflationary pressure for players at or approaching eight years of service.

    Secondly, there’s a briefly mentioned assumption that removing barriers to player movement will assist with equalisation as long as the salary cap is in place. It’s a typical free-market economist’s approach, and it’s not without logic.

    But there are obviously other factors: in particular the success of the club, but also geography, available facilities and third-party opportunities. Ryan touches on James Frawley, and that’s an example of how the salary cap system can only ever be a partial solution; the most high profile free agent at that time, who no doubt could have attracted some big offers, specifically chose to go to a club that makes a point of restricting how much it offers its top tier players in order to maintain its success. It makes sense that money would become less of a motivating factor the more of it you have, and Frawley almost certainly chose to eschew some funds above ~$500k a season in order to improve his chances of winning a premiership.

    The point is that when the AFL gives ground on free agency, it has to find another way to make up the gap on equalisation. And so far, it seems to be bereft of ideas.

    • Ryan Buckland said | February 17th 2016 @ 10:18am

      Thanks Tom, I’m glad you enjoyed it!

      I’ll respond to your comments in a little bit.

    • Ryan Buckland said | February 17th 2016 @ 10:18pm

      I think you’re spot on with restricted free agency Tom. My issue was that with the qualifying service level set at eight years, the only players that will ever realistically use it as a threat to move/extract more value are those with the clout to move anyway. Moving the threshold to six years would make it a more viable tool, both public and private.

      You are also quite correct on free agency – I’ll add another Econs 101 assumption into the mix here: over the long run, it should even out the distribution of talent. I’m not sure the primary objective of free agency is equalisation though; it’s about giving players that have proved themselves an alternative means to control their destiny, while also removing the archaic requirement that delisted players renominate for the draft. The equalisation argument is secondary, but still important.

      • Brian said | February 18th 2016 @ 9:27am

        I dont think the economics works because you have another distortion.

        Team A has a COLA. They use it and bet on a future salary cap increase to prize superstar from Team B (Hawthorn) leaving powerful Team B room to take Frawley & McEvoy from Teams C & D who are not so powerful.

        So instead of aiding equalisation FA allowed Hawthorn to make St Kilda & Melbourne pay for NSW expansion. Same with Treloar & Adams the more player movement the more distortions the more it favors the powerful.

        I hope FA doesn’t turn to 6 years and I hope the players are careful because it means the next Daniel Menzel might get delisted.

  • JKM said | February 17th 2016 @ 9:58am

    The Parochial system running the AFL (in fact all Australian sports) needs to collapse on itself and become reborn as a professional organisation.

    I am constantly amazed at the inability of the players to see the forest for the trees. Publication of their salaries will lead them to achieve better results by allowing them to better match themselves against comparable players.

    The players should get a fixed percentage of revenue and free agency should be culled back. Make the salary cap a hard cap.

    Players should be entitled to benefit from their own image, but should be required to assign rights applicable to their teams and be required to meet teams commercial obligations.

    People need to realise a league with an active free agent market draws attention 12 months a year, making it a more attractive and profitable property.

    • Ryan Buckland said | February 17th 2016 @ 10:21am

      All very good points. There’s plenty of very quaint concepts in the CBA, which one would expect to begin dropping out in the years ahead. Most of thee give the players disproportionate power and control over the clubs, which is incongruent with other sports. If the players want earlier free agency, I would hope they’d come to the party and give up some other things like their automatic trade veto rights.

  • Patrick Effeney said | February 17th 2016 @ 10:01am

    Good work Ryan – I like what you’ve done with the place.

    • Ryan Buckland said | February 17th 2016 @ 10:14am

      My HTML skills are getting pretty sharp, no?

      ^
      |
      This is the guy to praise for the design of this piece. I just spewed 5,000 words all over him – Paddy made it look pretty.

    • Samantha said | February 17th 2016 @ 10:32am

      The article looks nice, however, I do not like the 3 pictures back to back to back that you have to scroll through to continue with the story. Breaks the flow too much.

  • TomC said | February 17th 2016 @ 10:18am

    On another note, the news yesterday that Justin Clarke is still suffering from the effects of a concussion he received a month ago is really concerning, mostly for the young man himself.

    Let’s hope the structures that the AFL and AFLPA has put in place around injuries like this prove to be effective. Some players have had to take action after their careers have ended due to head injuries, so possibly there’s still some work to be done in this space.

    • Brian said | February 17th 2016 @ 1:14pm

      Yes at 600m revenue a year one would think a 1% spend of 6m could be set aside.

      I hope the CBA takes a TAC car registration type approach whereby every player is essentially underpaid by a set amount and the funds allocated to all present and future players to cover the associated costs.

    • Ryan Buckland said | February 17th 2016 @ 10:19pm

      I would be amazed if something serious and meaningful wasn’t brokered between the AFL and the players in this CBA. It’s an issue that is not going anywhere, and will worsen in the years ahead. The current post-career medical situation for AFL players is inadequate compared to global ball sports.

  • Paul D said | February 17th 2016 @ 10:52am

    Fantastic read. Thanks for this Ryan, very informative.

    • Ryan Buckland said | February 17th 2016 @ 10:21pm

      Thanks Paul I’m glad you enjoyed it! I loved getting into something this deep, and I hope that once the public CBA ructions kick off it’ll become a useful, relevant source for everyone.

  • Nick Welch said | February 17th 2016 @ 11:02am

    As always, great article Ryan. Covers the issues very well.

    Some other issues I’d like to see discussed when it comes to the negotiations:

    Lowering the minimum cap level. Currently, at 95%, it’s at $540,000 below the 100% level of the cap. That means that a team at the theoretical minimum level and assuming no change to the team’s TPP the following year has less “cap room” than a lot of players (as you say, 13% are earning more than 500k). Teams with retiring players or traded out players could theoretically go from 100% to below 95%, more cap room for free agents whilst a bottom team could go from 95%-95% due to contract increases to rising players.

    As others in the comments have mentioned – there’s too much power to the players. From no-trade veto power to the increased likelihood of a reduced free-agency power, clubs are very inflexible with how they manage lists. Alistair Clarkson said the other day in one of those Twitter Q&A’s that player movement is a lot easier because of fluid player movement. Maybe for him, coach of a top club, but with all power to the players it’s become extremely difficult for bottom clubs to manipulate the cap and their lists to rebuild earlier. There’s nothing wrong with FA so to speak, but it’s done to benefit the top clubs – look no further than James Frawley as an example.

    Which is why I’d like to see the negotiations done in such a way, in that if the players get a larger portion of the kitty and/or a greater or fixed proportion of the revenue, they’re happy to give up some of their “power” when it comes to contracts. This could include better investment on draft picks (3 year deals on 1st round picks, or club options to extend the contract, something like that), salaries being published publicaly (and therefore perhaps having the knock-on effect of more players playing for bottom clubs to to earn more rather than to play to win), or the removal of veto power in trades in some or all circumstances.

    I really think that this CBA will be the turning point for the AFL being branded as an entertainment product with much higher proportions of revenue – as you outline the numbers very well. Whilst the AFL has been professional for some time, many of the players earnt a salary that would put them at the higher end of a “professional”, educated worker of 100-300k range – not at the Amercian/European sports “entertainment” range of 500k+ or even $1 million+. As a result, even “philosophically”, the players attitude surely has to change – now all of a sudden they’re getting a heap more money, so they’ve got to accept more public scrutiny and they’ve got to accept less “control” of their place in the league merely because collectively they’re getting a lot more money.

    All of this isn’t even touching on the potential changes to free agency, or changes to free agency structure (can there be such a thing as a salary kicker to count against the cap for top teams to make it harder for them to sign FA? Should teams be able to go over the cap to re-sign their own free agents, but not other teams’) which is an article in an of itself.

    Again, a great article Ryan. Thanks for the read.

    • Ryan Buckland said | February 17th 2016 @ 10:28pm

      There’s a lot of very well made points here Nick – I won’t touch on all of them.

      But I will draw attention to your point on the salary floor. This is, again, a very quaint feature of our CBA, bought about because the AFLPA wanted clubs to be bound to spend ONE HUNDRED PER CENT of the cap. That would be even more ludicrous for the reasons you’ve noted above.

      The problem is now that it’s here, it’s going to be hard to get rid of it. This could be the League’s chance, though, given the cap is going to rise so much and the clubs will get a bigger slice of broadcasting cash. Something more realistic is 90%, or $1m at the moment.

      The other thing to consider is the banking mechanism included as part of equalisation measures. Clubs collectively “banked” $1.8 million last year that is available to spend this year or next – about 100k per club. In reality it’s likely concentrated in the hands of 6-8 clubs, which equals roughly one slightly below average paid player. If the floor is lowered to 90%, that gives clubs a very big degree of flexibility they can use to manage their list.

      • Samantha said | February 18th 2016 @ 1:28pm

        Don’t lower the floor just hold it at the amount it is now while letting the cap go up whatever it will go up by. Forget basing it on a meaningless %, just set the amounts for each.

  • Republican said | February 17th 2016 @ 12:29pm

    ….sort of related because the filthy lucre is what dictates these days while ‘the players’ clearly have an inflated sense of entitlement that contributes to what is a self perpetuating culture of avarice.
    (Q) When will the AFL cease their expedience of real footy heartlands i.e. Tasse, the ACT and yes the NT, (the latter boast the highest per capita following of the code in the nation), to restore a semblance of parity in respect of real growth of the code, including the grass roots that have been disenfranchised in my town anyway, because you know what, they can well afford to fund these long suffering loyal demographics of that there is NO doubt.
    When you consider how much the AFL have already earmarked in the form of a punt over a couple of decades on a potential financial basket case i.e. GWS, it is clear they have dough to burn.
    (A) Probably never – because the AFL is a veritable multi
    national monster dependant on and symbiotic of a ‘growth’ criteria set by tele networks and therefore arguably unfit to take the mantle as custodians of the indigenous code on behalf we we mere luddites.
    This model of growth lead to such historic demographics being usurped or leap frogged by GWS, Gold Coast – et al and this is why the next plastic brand may well be air dropped into the most undeserving of markets, NZ come the next expansion.
    God give me strength.

  • Adrian Polykandrites said | February 17th 2016 @ 12:38pm

    “The club of a restricted free agent holds the right to re-sign a player if they want to match the free agency offer that another club lodges – no club has chosen to do that in the four years of free agency.”

    Didn’t Geelong do this?

    • Adrian Polykandrites said | February 17th 2016 @ 12:39pm

      Damn, no edit. I meant, didn’t Adelaide do this with Dangerfield?

      • Ryan Buckland said | February 17th 2016 @ 1:33pm

        Nope, it never got to the offer-match stage. The Cats and Crows did it the old fashioned way, because Adelaide made it abundantly clear that they would match anything.

        • Adrian Polykandrites said | February 18th 2016 @ 1:11pm

          Right you are, those it really wouldn’t have changed anything. It’s not like they would have kept him if they matched. It’s such a faux system.

          • Ryan Buckland said | February 18th 2016 @ 1:50pm

            I reckon if it kicks in at six years it becomes much more valuable. Players like Luke Breust, Josh Caddy, Luke Dahlhaus and Jack Darling (to name a few) would be restricted free agents this season if they were coming off contract.

            • Samantha said | February 18th 2016 @ 2:38pm

              Small correction Ryan. Josh Caddy would not be eligible for restricted free agency because the 6/8 years must be at one club. He is only entering his 4th year at Geelong so would have two more years to go under the 6 year plan.

            • TomC said | February 18th 2016 @ 2:40pm

              Josh Caddy wouldn’t, unless his service at the Suns counted.

              Dion Prestia and Tom Lynch would be FAs.

            • Ryan Buckland said | February 18th 2016 @ 2:44pm

              Yeah, yeah, ok smarty pants’ :p

  • Cameron Rose said | February 17th 2016 @ 1:23pm

    Excellent work Ryan.

    What interests me most is the breakdown of earnings. I’d like to see earnings of rookies and years 1-2 draftees raised. I like the idea of the first contract to be a 3 year one.

    I like Tom’s points about restricted free agency being not totally redundant.

    My simplistic view of free agency is that it was brought in for good players from top clubs to go to bottom clubs for more money, thus making the competition more even. Anecdotally, it seems that this hasn’t really happened. Perhaps someone has a list that can prove otherwise.

    As for more player access, well, I couldn’t care less. There isn’t anything that makes me change the channel / turn the page / not click on a link more than hearing what a player has to say. No wonder there’s a rubbish overload.

    • Ryan Buckland said | February 17th 2016 @ 11:31pm

      Thanks Cam! I’m glad to see you back after your mic drop on the whole Dusty saga.

      I do have a list of free agents, but it’s too large to put here. Melbourne had been the biggest user of free agents, albeit most of them are of the delisted variety. Based on a cursory glance, there’s been a reasonable spread of clubs at different parts of the ladder when it comes to restricted & unrestricted FAs.

      On access, fair call with the players. They’re so coached as it is (exhibit A, everyone’s acrimony when Scott Pendlebury gave a non-rote answer last year). I’d love to hear more from the coaches though, but that’s out of the scope of this obviously.

      • Cameron Rose said | February 18th 2016 @ 3:43pm

        Haha, mic drop. Quality.

        Yeah, a lot of the coaches are compulsive listening aren’t they.

  • Chris Vincent said | February 17th 2016 @ 5:53pm

    Great read. Some painstaking research obviously went on here.

    • Ryan Buckland said | February 17th 2016 @ 11:31pm

      It was a lot of fun, though! Thanks Chris.

  • TomC said | February 17th 2016 @ 6:28pm

    I’m having a bit of trouble with the comments section in this format. I can’t seem to access them all.

    Any help?

  • Brett McKay said | February 18th 2016 @ 7:57pm

    Ryan, really enjoyable read, even for a non-AFL type such as myself.

    The numbers are mind-boggling. Can you contemplate being the 20th or 25th-ranked player at a club and making plus or minus $200K a year?!? No wonder kids are throwing away their basketballs and cricket bats!

    Excellent piece though. I’ve had it open for two days to make sure I got to it, and I’m certainly glad I did tonight..