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Capping the cash

Soccer officials look to limit rising salaries in the Gambrinus liga

By František Bouc
Staff Writer, The Prague Post
January 23rd, 2008 issue

ISIFA
The Gambrinus liga's highest-paid players, like Tomáš Řepka of Sparta Praha, could see their wages curbed if a salary cap is imposed.
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When he began talks with club management about extending his contract, Liberec midfielder Ivan Hodúr decided to play what amounted to Russian roulette early this month.
Well aware of the generous salaries that had been appearing among his peers in the Gambrinus liga, the country’s top-division soccer league, Hodúr decided to seek a 1.5 million Kč ($85,000) bonus. After all, he had spent seven years with Liberec and was considered the team’s most valuable player.
“I knew I could be refused or even dismissed, but I decided to try it,” the 28-year-old Hodúr said. “At my age, I have to consider money.”
Liberec owner Ludvík Karl was uncompromising in response. “No way,” he said when confronted with Hodúr’s demand. Days later, the club’s management moved Hodúr to Liberec’s reserve squad and then traded him to Mladá Boleslav. The club also took the unprecedented step of publicizing Hodúr’s demands on its Web site.
While seemingly a simple salary dispute, Hodúr’s story may be a sign of things to come in the Gambrinus liga.
In a move to counter the rising salary demands coming from the league’s players, the Czech Football Association (ČMFS) is considering the introduction of salary caps on the country’s professional clubs. Such caps would significantly increase the leverage club owners have over their players, meaning more and more stars like Hodúr will fall short in salary negotiations.
“We’d like to have [a salary cap] in force by next season,” said Jaroslav Vacek, ČMFS vice chairman for economics.
According to Vacek, a salary cap would bring financial stability to Czech soccer, which has seen tumultuous times of late. In 2005, the league stripped several professional clubs of their licenses for financial defaults. Even the league’s richest clubs, such as Slavia Praha, have owed players money in salaries or bonuses.
Clubs often pay players more than what they can really afford, Vacek said. “We’d like to set a share on the club’s guaranteed seasonal budget that can be used for salaries.”
Such a scenario would require accuracy in reporting teams’ budgets, which could be an obstacle, said Lukáš Přibyl, director of the Bohemians 1905 club.
“The ČMFS would then need to make sure club officials do not report false figures,” he said.
The ČMFS says that in seeking a salary cap it is following the example of the NHL in North America, which used such a system to right itself financially. “We’d like to see this model work here, too,” Vacek said.
Wage inflation
Steeply rising salaries have been a thorn in the side of Gambrinus liga officials for a while.
After the overthrow of communism and the launch of professional clubs in 1990, the league’s best players began earning some 12,000 Kč per month, agent Pavel Paska recalled. And those salaries “went to only the best players of Sparta Praha,” he said.
But then the arrival of Czech-American businessman Boris Korbel and his purchase of Slavia Praha in the early 1990s triggered price inflation in the league. Korbel did not hesitate to pay large transfer fees for players and lavished his team with financial incentives for successful results.
Another wealthy entrepreneur, Slovakia’s Alexander Rezeš, who owned Sparta Praha in the late 1990s, paid the team a 30 million Kč bonus for its historic advancement over Austria’s Salzburg to the financially lucrative Champions League.
Bonuses like that spoiled many players, Paska said.
“They got used to money that they couldn’t even dream about before,” he said. “Then, other clubs were joining in to remain competitive.”
Another players’ agent, Dalibor Lacina, said that not even the exodus of star players to foreign leagues helped slash the high costs to Gambrinus liga clubs.
“Stars were leaving but the new players who filled those vacancies inherited the same money,” Lacina said.
As an example, Lacina points to the case of famous midfielder Pavel Nedvěd, who left Sparta Praha for riches abroad in 1996. The current stars at Slavia and Sparta now make more than Nedvěd did when he left for Lazio in Italy.
Until spring 2004, professional soccer players in the Czech Republic were registered as self-employed and paid taxes on their own. After European Union accession, they became employees of the clubs and so the teams had to start paying taxes for them. This helped result in serious financial woes for many teams.

František Bouc can be reached at fbouc@praguepost.com


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