Essendon trade moves and the secret 'COLA'-style payments people still don't understand

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#55
Quick version : The AFL allowed Essendon to deliver big payments outside the salary cap in the form of legal settlements probably giving them a massive advantage over other clubs still to this day.

Long version: Essendon have done absolutely nothing wrong as they simply followed the AFL's directives. This is not the 'supplements saga', this is more like COLA. It was AFL, whether intentionally or incompetently, compromising the competition again.

The reason it's interesting to bring it up now is that generally people didn't understand the possible implications at the time and still don't. They didn't seem to get that it could allow Essendon to retain (almost) all of its gun players and young talent while raiding genuine talent elsewhere for a number of years. And that is what we are starting to really see now - seemingly no pressure to retain wanted (from outside) players and the ability to go after multiple big signings in consecutive years.

Essentially Essendon was allowed to make discretionary payments to players outside the cap who they were simultaneously trying to keep contracted at the club and negotiating salaries with, with the only oversight being that Essendon had to pay 'market value'. This means they couldn't take the absolute piss with the cap, but it did mean that they could easily free up extra cash for each player and allow further room to maneuver with front-loaded and back-loaded contracts. It reduced the likelihood of paying overs for required players, helping list management. This means the effects were always going to last for many years after the payments.

Collingwood would love to pay Tom Lynch a 3 million dollar settlement if he stubbed his toe while meeting Bucks, pay him a bit less on his contract than otherwise and use the spare cash to help fend off any future plays for Stephenson. A settlement is just a payment from a club to a player outside the cap. It's ridiculous that essentially only Jake Niall in the media realised this was a problem at the time (but even he couldn't see how inadequate the 'fix' was) and other clubs have screwed up badly by not pushing back on the AFL.

Lastly, someone will post that these were just insurance payments - this is a lie. Insurance covered SOME of the payment amounts, but Essendon was paying discretionary amounts to different players from its own pocket.
Linda I'd spend more time looking at my own club if I were you. And id be asking a question like "why are our players repeatedly failing drug tests?"
 

Marc_Remillard

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#61
Without AFL intervention the club would have folded. The were allowed to make payments which should have come under salary cap.
Sure, but it was an unusual situation. The AFL needed Essendon fielding a team, the other 17 clubs also needed it as well.

Sometimes things like this just have to happen
 

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Marc_Remillard

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#62
It's not really to do with the top-up players.

There was no easy answer as to what they could have done about the situation, short of requiring that no current Essendon player could negotiate a settlement. That would've caused a likely exodus - but that shows you why the whole thing was inherently compromised and also that the idea that compensation/contract negotiations were completely separate just doesn't make any sense. They were intrinsically linked.
Yeah, the AFL have manipulated the competition since it was formed
 

Tayl0r

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Moderator #66
I remember this topic coming up when Cale Hooker was coming out of contract, there was no way another club could match a deal from Essendon when the numbers could be artificially inflated with hundreds of thousands of dollars extra up front as a signing bonus.

And you can formulate that into the system to hide it like this:

Current contract offer x 0.1 = compensation payout.
Essendon use it's existing deal with Hooker to determine payout, or they can use their offered contract should he choose to stay with the Bombers as that will be 'contract' when the settlement is signed. The five year deal value is far more than his previous deal so he gets more cash up front.

Given his loyalty to the Bombers previously I don't think the chance of him leaving was all that high, but it does create a situation where the Bombers can pay Hooker less in the cap than other teams would offer and make it up with the compensation payment.

It's only the potential for murkiness, like the AFL CEO ringing the top level staff who happen to be in a meeting the day before news breaks about it, all coincidentally.
 

QuietB

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#73
No surprises here, they have been cheating and rorting the system for over 100 years.
This pretty much sums it up - wed all be a lot more surprised if Essendon were not gaming the system.

An example with zero evidence - Hurley was a minute from signing with the Dogs until something changed his mind. I would be astounded if compensation payments did not form part of conversations :think:
 
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