Leicester Tigers learn of punishment after salary cap inquiry

Leicester Tigers are to pay more than £300,000 in fines and tax following the conclusion of a Premiership Rugby investigation into salary cap compliance.

But Steve Borthwick’s side, who are 12 points clear at the top of the Gallagher Premiership, will not face any points deduction for historic lapses between 2016 and 2021.

The investigation was launched by Premiership Rugby salary cap director Andrew Rogers using enhanced powers introduced following a regulatory review in 2020.

In summary, the investigation revealed that Leicester Tigers and one or more of the club’s business partners had entered into agreements whereby a third party company made payments to Leicester Tigers player image rights companies. These payments should have been reported to the salary cap director as salary, but were not disclosed.

In each of the four seasons from 2016-17 to 2019-20, the Leicester Tigers exceeded the salary cap by an amount below the ‘overshoot’ limit above which a formal charge can be made for a breach presumed regulation.

The club have accepted the findings, meaning there will be no further disciplinary proceedings or appeals. The level of fine imposed in these circumstances, known as the excess charge, is calculated according to a formula set out in the regulations.

Due to the previously undisclosed payments now being considered salary, the Salary Cap Director has determined that Leicester Tigers exceed the salary cap by the following amounts:

  • 2016-17: £147,750.00 (senior salary cap £6,000,000; overage limit £325,000)
  • 2017-18: £89,718.05 (senior salary cap £6,400,000; overage limit £350,000)
  • 2018-19: £55,886.69 (senior salary cap £6,400,000; overage limit £350,000)
  • 2019-20: £98,586.32 (senior salary cap £6,400,000; overage limit £350,000)

During the relevant period, the Earnings Cap Regulations stated that for the first £50,000 overrun, a club would pay a tax of £0.50 for every £1 overrun. Beyond the first £50,000 and up to £200,000 of excess, the charge is £1 for each additional £1 of excess.

Therefore, the breakdown of the overage tax on Leicester Tigers is as follows:

  • 2016-17: £122,750.00
  • 2017-18: £64,718.05
  • 2018-19: £30,886.69
  • 2019-20: £73,586.32

Additionally, Leicester Tigers have been fined £17,900 for failing to disclose information on the above arrangements over the five seasons from 2016-17 to 2020-21 inclusive. As of 2020-21, the Tigers were fined for non-disclosure, but there was no salary cap breach.

This makes a total of £309,841.06 in fines and taxes.

Leicester Tigers chief executive Andrea Pinchen said: “The club has cooperated with Premiership Rugby throughout the period of investigation into the historical salary cap expenditure. We accept the decision and acknowledge that there were no overruns during the last exam season.

“We are grateful that this matter has been brought to a conclusion and delighted that we can now focus all our energy and efforts on the future of the club.”

Salary cap director Andrew Rogers said: “The review of the salary cap settlement has provided stronger powers to monitor spending and investigate possible breaches of the cap in past seasons. Leicester Tigers have cooperated my investigation and accepted the findings, which allows us to apply the penalties detailed in the regulations.

“While we are pleased that the arrangements which resulted in the overspending have come to an end, we will continue to assess all expenditures as part of our ongoing monitoring process at each club.”