FOOTBALL FINANCES

In Denmark, if you are a wage earner, then your employer calculates 12.5% of your wages and pays this additional amount into the "holiday fund". The holiday fund then pays the money back out to you when you go on holiday. This antiquated and bureaucratic system dates back to the time when workers didn't have bank accounts, and the unions wanted to ensure that their members had money when they were not working. It has never applied to people paid a salary, who get twelve equal payments a year, irrespective of whether they are working or on holiday.

Footballers are wage earners, so the holiday fund system applies to them as well. But a problem arose. Footballers not only get a weekly wage, but also the possibility of signing-on fees and bonusses. Under Danish law, these payments are counted as wages, so the clubs should have paid an extra 12.5% of them into the holiday fund. For reasons that are not entirely clear, most of the top clubs didn't do so. The players' union, in a test case, sued the clubs. Yesterday they won.

So, are the players happy? Not entirely. Some players near the end of their careers will doubtless be glad for the extra cash. But the amounts of money involved are so large, that some clubs may go under. The finances of many Danish sports clubs (not just football, but also handball and ice hockey) are pretty fragile at the moment, since they rely, to a much larger extent than in bigger European countries, on sponsorship from local businesses, many of which are tightening their belts. There are only twelve clubs in the Danish football Super League, and only one or two that really matter. Brøndby, one of the two big Copenhagen clubs, was the one that lost the test case, and was already rumoured to be close to collapse. This case may tip it over the edge.

Walter Blotscher