Rugby Australia will shed one-third of its workforce as well as cut salaries as it looks to save $5.5 million in phase one of a brutal wholesale restructure announced on Monday.
After lodging their 2019 financial report that provisionally flagged a $9.4-million loss, RA interim chief executive Rob Clarke announced the massive job cuts in an attempt to reshape the cash-strapped code.
Over 75 per cent of RA’s workforce has been stood down or on significantly reduced hours since April 1 and many won’t return at all with Clarke announcing they would shed 47 of the 142 full-time staff over the coming months.
A further 30 contractors and casual workers have also had their roles terminated with immediate effect.
The full program of cuts will reduce the company’s current wages bill by $5.5 million.
In addition, RA is seeking to implement a five per cent reduction in base salary for all senior retained staff to take effect from their return date.
“Today was an incredibly difficult day for the organisation with many people affected by changes that are necessary to ensure the viability and sustainability of the organisation as a result of the devastating impacts of the pandemic,” Clarke said in a statement.
“We have delivered the news to staff this morning and told them that Rugby Australia values the contribution of each and every one of them, some of whom have given significant service to Rugby Australia and to the game over many years.
“This is a difficult time for a lot of very passionate, hard-working Rugby people and we are committed to helping those people find their next opportunity, whether it be within the game or elsewhere.”
Clarke said phase two of the restructure was under way and was examining the role of RA and the State and Territory Member Unions in delivering rugby across the country.
“The next phase is to find further opportunities for savings and efficiencies in the way we deliver our rugby programs and administrative operations across each of our businesses,” Clarke said.
RA announced on Monday the Japan-based Sunwolves won’t take part in a five-team domestic competition that will start next month and will meet with Fox Sports this week to hammer out a reworked broadcast deal for the modified competition in 2020.
Negotiations for beyond this year are stalled with SANZAAR uncertain of a ongoing format due to the coronavirus pandemic which stopped competition in March.
Gepetto
Roar Rookie
Do you think that option is open to coach Rennie?
Ex force fan
Guest
The ARU offered to cut a team knowing that there is only one team to be cut - the Force. SANZAR cannot force any of the unions to take such an action as all the SANZAR nations have a veto. Since 2017 RA has lost its ability to appeal to the greater good of the sport across Australia. How does it relate to the current situation. RA was in financial trouble long before COVID-19. They have allowed the financial situation to deteriorate since 2003 and made a couple of dubious choices that led to some very poor choices lately. I have posted several posts in the past 3 years in relation to RA poor performance, short sighted decisions and lack of strategic vision.
WallabyJ
Roar Rookie
Commiserations to all those that lost their jobs. I sure hope every position cut is in the best interests of the future of rugby in Australia. It is a bloody awesome game with hardcore loyal supporters. Fans and players of all grades have suffered long enough with the mismanagement of our game. I really hope that the leaders at RA can structure a lean and effective organisation that is all about the rugby, and that we will have a rugby system and winning culture to be proud of in the near future.
Gepetto
Roar Rookie
I didn't forsee a comparable deal, because the wallabies are / were on the slide, Coach Clown was hard to love, I rarely met anyone who watched Super rugby, Super rugby crowd numbers were low, Western Australian fans were alienated and a significant number of people were disappointed with the Folau debacle. Rugby league annoys me, so I have no choice but to watch rugby but I cannot see why Raelene Castle and the Board thought Fox would continue to pay at a comparable rate. Ratings must provide some indication of the value of the product.
Ex force fan
Guest
I don’t think RA has much of a say in how they spend their money. The money World Rugby lend them have very tough conditions attached, Twiggy will not fund anything without demanding radical changes and even the broadcasters will not give them money for free. Money is king and when you’re facing bankruptcy your choice are limited and so is your license to operate. The second round of cost cutting will be unleashed to the franchise and state levels soon and those like the Rebels that has historically been bankrolled by RA will be in trouble. Competitions that do not pay for themselves such as Superugby, Sevens, Woman’s rugby and even the NRC are unlikely to survive the brunt of this cut.
Val Saunders
Guest
Interesting to note that the Welsh Rugby Union is also facing financial problems but have taken a completely opposite path to saving the game from RA. They have ring fenced the amount of money they give to community rugby and will work with the balance for the professional game. Who has the best approach - WRU or RA?
Paulo
Roar Rookie
“... cutting the Force set off predictable set of events that already come back to haunt RA including losing control over the future of rugby in Australia.” Well, SANZAR already had control more or less, hence their direction to cut a team had to be followed. And I’m not sure how cutting the Force has lead to this current situation... would the Force have been able to stop COVID-19? I’m genuinely interested in how you think the Force cutting actually came about and has directly lead to the current situation. ?
stillmissit
Roar Guru
KFTD: You must be decent reader to hint at that book? One of the best writers of the 20th century.
Micko
Roar Rookie
I don't think there is "pleasure" per se at people being unemployed, just relief that a seemingly top heavy and bloated organisation that runs a sport that is easily in last place in competition with the other three pro football codes, but isn't even close to being in the top five men's sports in Australia, and with little public support in large areas of Australia, is now going to see a reduction in staff (and salaries?) many felt was overdue, and certainly more natural considering rugby union's very limited appeal in Australia.
Johan
Guest
Rugby Australia was hugely bloated given it is the fourth football code in Oz now. This was very much on the cards- especially with the ridiculous amount they were playing the Former CEO Castle.
AndyS
Guest
Which is well and good, but suggests that they long since lost sight that any waste, inefficiency or self-indulgence was and is money not spent on community rugby. The "good old days" were, at least in part, because he money the Wallabies made all flowed to the community in the absence of professionalism. That had to change, but the principle still stands and the professional game should not be an end in itself...the state of the game now is where that road winds up. Maybe going forward that should be the first and foremost KPI...the percentage of total revenues returned to the amateur game.
Gray-Hand
Roar Rookie
Because there was an expectation that the next tv rights deal would be comparable to the current one, and that revenue would be comparable. The pandemic changed all that.
Gepetto
Roar Rookie
Why didn't Raelene Castle do this earlier?
Gray-Hand
Roar Rookie
How many free to air rugby matches were there every year before Foxtel started showing super rugby?
Ex force fan
Guest
I would imagine cutting the Force was desirable from a Rebel's support point of view. Will the Rebels survive...time will tell.
Ex force fan
Guest
Clyne claimed that he saved $18 million just in 2018 from axing the Force vs $5.5. million from axing 77 people. This appears to be the way to go if you want to make a substantial cost saving I never subscribed to the cutting yourself into insignificance theory, but RA do. From a rugby perspective it may be the best outcome as the teams/states axed can then join the GRR of they can get a private owner that is prepared to back them financially.
stillmissit
Roar Guru
Great stuff, wish they were doing more out west Sydney.
Ex force fan
Guest
It may extend to some of the states that is still enjoying funding from RA. With less people it may be easier to pull in the same direction.
Pegasus64
Roar Rookie
Great to read all the comments about people losing their jobs - fun isn't it! All about RA bloating, not supporting grassroots, booting the Force out of SR, having all the DO's work for them, taking all the money from the tooth fairy, ... yadda, yadda, yadda! All businesses are bloated at some time or another. Q: Will this make rugby more agile and able to rebuild into a prosperous sport we all believe in? Time will tell. I do know that people have to pay mortgages and now that they've lost their livelihood it must be a terrible time for them and their families. I hope for their sake they don't read comments like some of the one's below. What i do hope for is a realignment that brings the rugby community closer together. There will be more hurt - COVID19 has seen to that - but I am hopeful that whatever happens this season is positive and the jobs that have been lost were not lost in vain. Stay strong for anyone losing their job. https://www.lifeline.org.au/ https://www.beyondblue.org.au/
Ex force fan
Guest
You are missing the point TWAS, cutting the Force achieved nothing as RA is still facing bankruptcy. Also from a different and more strategic perspective cutting the Force set off a whole set of predictable set of events that already come back to haunt RA including losing control over the future of rugby in Australia. Will the RA of the future still have any meaningful role to play after the lost control of the competition and players?