Barcelona wage cuts explained: Why do the world's richest club need to reduce salaries in coronavirus crisis?

Ben Hayward
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Just two weeks after LaLiga was suspended due to the coronavirus crisis, Barcelona announced a reduction in wages.

Spain's top flight was suspended for two weeks on March 12 and all football has now been called off until further notice amid a "state of alarm" caused by the spread of Covid-19, which had seen over 64,000 cases and taken more than 4,800 lives throughout the country.

In a statement posted on their website on Thursday night, Barcelona said that due to the enforced break, they had opted for a "proportional reduction of the remuneration provided for in respective contracts".

The measures have been introduced in order to "minimise the economic impact that the coronavirus crisis is causing on the activity of FC Barcelona," the Blaugrana went on to say.

What is an ERTE?

Barcelona's move to cut wages has seen the Catalan club invoke what is called an 'ERTE' in Spain. That stands for "Expediente de Regulación Temporal de Empleo", which translates to Temporary Regulation of Employment Action.

An ERTE is a temporary authorisation for a company through which employment contracts can be suspended for a certain time, with salaries reduced or even cancelled. Holiday days cannot usually be taken in this period, either.

In Article 47 of the Workers' Statute Law in Spain, an ERTE is described as "suspension of the contract or reduction of working hours for economic, technical, organisational or production reasons or due to force majeure".

Who will be affected by the ERTE at Barcelona?

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Barcelona's first-team players will be hit with wage cuts, as will the other sportsmen and women in the club's six sections: football, basketball, handball, futsal, roller hockey and amateur sports (which includes athletics, hockey, rugby, volleyball and more).

The club's non-sporting employees will also be affected by the ERTE.

How much of their wages will players lose out on?

The proposal from the club is for Barcelona's players to have their wages reduced by 70 per cent. That means they would only take home 30% of their normal salary during this period of inactivity, but would earn as usual again once all activities resume as normal after the shutdown.

Have the Barcelona players agreed to it?

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Barcelona's players are willing to cut their wages in the current situation and have told president Josep Maria Bartomeu they are prepared to work with the club to find a solution.

At the moment, though, the squad have not accepted Barca's proposal to reduce their salaries by 70% and negotiations will continue in the coming days. It is thought that the players would be happy to give up around 10% of their annual earnings.

What about the non-sporting employees?

Prior to Thursday's announcement, the FC Barcelona Workers' Committee released a statement expressing concerns at the prospective cuts, saying they had not agreed to the measure and reminding the club that their workforce takes up just 3.7% of the annual budget (compared to the 61% earned by the sportsmen and women).

Why can't Barcelona afford to keep paying as normal?

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Barcelona's revenue income for last season stood at €840.8m (£726m), which was the highest in world football, but the Catalan club also pay out more in wages than any other team in sport (with Lionel Messi alone earning around €35m annually and Antoine Griezmann €17m per annum).

The shutdown means Barca will miss out on matchday income (around €6m per game from gate receipts alone), while the club's many sponsors also lose visibility if there are no fixtures taking place.

In addition, all of the megastores have had to close, along with the Museu, the third-most popular museum in Spain with 1.9m visitors a year and earnings of around €58m annually.

All of that has hit the club hard, and finances were already tight after the club paid €18m in February to sign striker Martin Braithwaite from Leganes in an emergency deal to replace long-term injury victim Ousmane Dembele.

Will other clubs follow suit?

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Atletico Madrid announced similar measures on Friday and said it was necessary to "guarantee the future of the club" in a statement posted on their website. Barca's city rivals Espanyol have also confirmed their own ERTE, with their male and female teams both affected by the cuts.

Other clubs will likely follow suit in the coming days, but Real Madrid are unlikely to be among them. Los Blancos are currently less burdened by wages than Barcelona – especially since the departure of Cristiano Ronaldo (who earned €29m per year at Real) to Juventus in 2018.