Liverpool's Move Toward Performance-Related Pay Is the Future of Football
When Christopher Samba joined Queens Park Rangers in the January transfer window, the London club agreed to pay him £100,000 a week until June 2017.
Regardless of how poorly he performs on the pitch—and he has been particularly disappointing for the Hoops—the 29-year-old is entitled to a six-figure windfall every week until he is 33 years old.
Wayne Rooney is thought to be one of the Premier League's highest earners, with a weekly wage somewhere north of £200,000. After Sunday's match with Swansea, however, Sir Alex Ferguson admitted Rooney had asked not to play on account of a transfer request. Even though Fergie obliged his request and he did not help the team, you can bet he still received a weekly salary that would keep many people going for 10 years.
In possibly one of biggest injustices of the Premier League era, a top-flight footballer of any calibre is guaranteed a very comfortable salary, regardless of their contributions to the team. It's the equivalent of a city banker being handed his huge pay check even if he decides to spend most weekdays on a golf course.
This absurd approach to economics in the modern game, however, might soon be coming to an end.
The Guardian's Sean Ingle has written a very interesting piece about the impending use of performance-related pay and key performance indicators (KPIs) among professional footballers.
Instead of an immovable base salary, players might soon be remunerated with bonus payments based on their contributions on the field, as measured by a particular set of in-game metrics.
According to Ingle's source, at least two teams in the top five want to introduce this kind of payment system.
Meanwhile, a team just outside the top five have already publicly announced their intention to change their pay structures. In January, Liverpool managing director Ian Ayre spoke of the club's intention to offer lower base salaries with higher performance bonuses. He is quoted by the Liverpool Echo:
"From the football club's perspective, our view has to be that people are rewarded for contributing towards what we achieve. As long as contracts are structured in that way then everyone wins.
"If a player performs then he will be rewarded. That's the philosophy of the contracts we are offering and signing."
The plan makes perfect sense: The best performing players will still be handsomely rewarded, while those who are not pulling their weight will not be a financial liability.
Performance-related pay would also remove the long-term burden of clubs issuing excessively multi-season lucrative contracts—much like Chris Samba's. Or in the case of Liverpool's purchases of Alberto Aquilani and Joe Cole, it would limit the damage of players failing to live up to their potential.
Perhaps it will also have an extremely positive effect on motivation.
Last season, Manchester City had the highest wage bill in the league at an eye-watering £202 million, which represents 87 percent of their turnover (statistic via The Guardian). If City's stars didn't know they had stupendous guaranteed wages this season, they would almost certainly have tried a little harder to defend their league title.
Imagine how much a player would strive if he knew he had to truly earn his next Aston Martin. (And based on the underwhelming outings of certain players in their squad this season, imagine how much smaller City's wage bill would be if they were actually paid by performance-related bonuses!)
Ingle's Guardian column also mentions the fact that the Qatar Football Association is implementing performance-related pay. In order to increase the standard of play leading up to the Qatar 2022 World Cup, league bosses are making players work harder for bigger financial rewards.
League director Valter Di Salvo says 40 percent of pay will be based on appearances, 40 percent from a "technical assessment" from the coach (which takes into account their fitness, skills and professionalism) and the remaining 20 percent from their actual performance on the field.
The main problem is discerning how much a players' performance is worth. How much better is a striker who scores a penalty than a centre-back who helps keep a clean sheet?
The answer, it seems, may be the system on which Sam Allardyce bases his decisions: Prozone stats.
Rather than simply measuring a team's goals or clean sheets, a midfielder might need to make a certain number of runs or dispossessions. A goalkeeper might need to land a certain amount of goal kicks on a teammate to receive an extra bonus.
Of course, if such a system were introduced, there is a risk it may cause players to worry only about their individual performances, at the expense of the team.
But in an age were financial fair play regulations are coming in to prevent the football bubble from bursting, clubs need to be smarter with their money. Using performance-related pay will have a beneficial effect on finances, motivation and perhaps even standards on the field.
Where Liverpool are leading, many clubs are set to follow.
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