Furloughing staff

[robin09]

The optics of this were pretty bad in that my mates who don't even follow football sent me messages yesterday somehow thinking I, as a Spurs fan, need to be informed that the club I support were dicks for having to be in a position to do a u-turn in the first place.

Money has to be saved somewhere and I don't personally think Furloughing the staff they did was an attrocious act of greed and corruption, especially when faced with the facts.

I do think they made the decision too early though and should have waited until we know how long they were going to need to furlough.

It's just funny the moral high ground anyone in here is taking over one opinion or the other. Like anyone here knows what it's like to have to make decisions regarding a business of that size while having to worry about how the world is going to judge you.

The argument of not cutting staff wages by 20%, or in some cases the seperate moral argument against using the Government's furlough scheme is overly simplistic.

Some feel we should cut transfer budgets and youth development budgets before the non-playing staffs wages. The idea of protecting our spending budget is being considered heartless and immoral by some. Or, at least a sacrifice worth making.

But that is to forget the entire purpose of the 'football business'.

If the club has to limit the talent it is able to buy, or able to develop, then that will directly impact on-field performance. If the on-field performance is hindered, then that puts the club at risk of not being as competitve and dropping down the League table and missing out on cup revenue, gate receipts, merchandise sales, TV money etc. Our revenue hit would be a vicious circle.

Levy was trying to protect us from that risk by diversifying the uses of the stadium. Spread the risk, create new revenue streams. Don't allow the financial stability of the club be at the mercy of the squads form. Unfortunately, this pandemic and the weird desire from fans for the club to take the 100% overhead hit, is the perfect storm of ways to strangle the clubs intentions to mitigate it's financial risks!

So, anyway, what would happen if we act like investment in the playing staff is a luxury that we can afford to sacrifice? We'd probably end up in a position where we have to sack non-playing staff.


Imagine it was a different industry. Say a computer hardware manufacturer. If they were put in this situation by their customers, protesting against using a government scheme, or cutting 20% of the wages etc, what would be the other option?

Cut the R&D budget? Don't buy the latest manufacturing equipment, to instead pay the staff's wages? To do that would harm the future success of the business. It may not be able to keep up with it's competitors. It may become less successful, stuck using ageing hardware and not being able to keep up with advances.
To demand the staff wages are paid by the company themselves, and to sacrifice it's ability to remain competitive in the market place in future, puts those very same jobs at risk by putting the future success of the company at risk.

Now, all of this may be academic. Finger's crossed that life can somehow return to normal within the next month or so. Then this whole argument will have been a storm in a teacup. But you have to plan for worse than the best case scenario, and in that event the priorities some fans have chosen are going to do so much harm to the club, that the staff they're trying to protect are going to be the worst affected.

 

[brasil_spur]

I don't believe anyone is saying lockdown as it exists will continue for another 6 months. More just social distancing and some regulations will be kept in place. Essentially we're not gonna just go back to normal straight away, it'll just be a more gradual thing.

With regards to Furlogh for that (to keep it on topic) I'd imagine we'd get empty arena games before we get fans at the stadium which would get some form of revenue coming back to the club (if anything mainly TV deals) which would ease the burden on the club.

Though as you said, this could and probably would be the least of our worries.

My original reply was in relation to a post about us having to make staff redundancies down the line if in 6 months things were still ongoing. As you say i can't see things continuing as they are right now for 6 months, so there will be a gradual ease up and whether it's in front of crowds or not we should be generating income again and thus be able to keep staff. From what i know we run a fairly lean non-playing staff head count as it is and so the only case i can see us having to let staff go will be if things are still in near total lockdown in 4-6 months, which is very unlikely IMO.

 

[brasil_spur]

But that is to forget the entire purpose of the 'football business'.

If the club has to limit the talent it is able to buy, or able to develop, then that will directly impact on-field performance. If the on-field performance is hindered, then that puts the club at risk of not being as competitve and dropping down the League table and missing out on cup revenue, gate receipts, merchandise sales, TV money etc. Our revenue hit would be a vicious circle.

This would be the case if we were the only club affected, or even if the PL was the only league affected, but in reality as one of the richest clubs in the world, the forced necessity of having to cut our budget, let's say to zero for this summer, will mean that the vast majority of other clubs in the PL and Europe will be at least the same disadvantage as us, if not worse off.

Frankly, without any player investment this summer we'd still have a fairly strong team, maybe not as strong as we'd like, but there's a realistic scenario that could mean we end up better off than other PL and European teams based on the way the club has been run.

 

[robin09]

This would be the case if we were the only club affected, or even if the PL was the only league affected, but in reality as one of the richest clubs in the world, the forced necessity of having to cut our budget, let's say to zero for this summer, will mean that the vast majority of other clubs in the PL and Europe will be at least the same disadvantage as us, if not worse off.

Frankly, without any player investment this summer we'd still have a fairly strong team, maybe not as strong as we'd like, but there's a realistic scenario that could mean we end up better off than other PL and European teams based on the way the club has been run.

That would be true if every club had the same overhead and exposure to debt.

We have just built a £1billion stadium that has to be paid for. Being 'rich' is a misleading term. Is the guy with a new Porsche and a big house 'rich'? Or does he have huge personal loans?

We have considerably more exposure to debt than many other rival clubs. We also don't know when football, and therefore business, will return. So at the moment it's pure speculation to say we'll be better off when we can't even say how much money we will have lost, how much servicing of our debts will have happened, by the time the option to sign players comes back around.

 

[brasil_spur]

That would be true if every club had the same overhead and exposure to debt.

We have just built a £1billion stadium that has to be paid for. Being 'rich' is a misleading term. Is the guy with a new Porsche and a big house 'rich'? Or does he have huge personal loans?

We have considerably more exposure to debt than many other rival clubs. We also don't know when football, and therefore business, will return. So at the moment it's pure speculation to say we'll be better off when we can't even say how much money we will have lost, how much servicing of our debts will have happened, by the time the option to sign players comes back around.

It's not the same though, if the guy had bought a classic 1960s Porsche for say £3m then whilst he would have a load of debt he would also have an asset with a fixed value that can be leveraged for future borrowing. In addition he could rent out the classic Porsche for a very high rate in the future for say weddings and generate a lot of future revenue from this expensive asset. Also the loan he has will be paid off, say in 5-10 years. At which point the value of the Porsche will have very likely grown.

Most "rich" people don't have anything close to their net worth in available cash and are continually leveraging the majority of this worth to increase their wealth over time.

So yes we have exposure to debt, but that debt has been used to create valuable assets that not only increase the revenue of the club directly (i.e. through making us a better football team), but also by secondary revenue generation such as hosting events etc...

Additionally once the current crisis is over then those same debt causing assets will start generating huge amounts of income.

Other clubs may not have the debt we do, but they also are unlikely to have the financial leverage we have due to a lack of assets. Even some of the "rich" clubs are propped up by their owners rather than by the assets of the club. Many other clubs are not able to generate revenue anywhere near as quickly as we are once the world gets back to normality. Even from a player standpoint we are high up in terms of current squad player value and have one of the most valuable players in the world right now. Not that i'd want us to sell Kane, but if selling Kane meant the difference between the collapse and survival of our club then i could live with it.

In summary i think we're better off than many clubs, but there are some risks for us. In the end however what i think we're likely to see is that those clubs which have been running themselves "properly" for the last few years will come out of this ok.

 

[vegassd]

Other clubs may not have the debt we do, but they also are unlikely to have the financial leverage we have due to a lack of assets. Even some of the "rich" clubs are propped up by their owners rather than by the assets of the club. Many other clubs are not able to generate revenue anywhere near as quickly as we are once the world gets back to normality. Even from a player standpoint we are high up in terms of current squad player value and have one of the most valuable players in the world right now. Not that i'd want us to sell Kane, but if selling Kane meant the difference between the collapse and survival of our club then i could live with it.

In summary i think we're better off than many clubs, but there are some risks for us. In the end however what i think we're likely to see is that those clubs which have been running themselves "properly" for the last few years will come out of this ok.

There's so much nuance in all of this I find it fascinating.

In a "normal" scenario or if Spurs were being affected by this alone I would totally agree, but if all clubs are taking this kind of financial hit it will do funny things with the value of players. Obviously we don't know how that's going to look at this stage but given Levy's cautious nature I could imagine him not liking the idea of selling a prize asset when the transfer market is deflated. That's to be seen of course.

Our stadium certainly gives us revenue potentials above many other clubs although lots of those events do rely on crowds so there will be some additional lag based on social distancing measures, plus how hard the country will be hit by recession. I really hope that big events get back to normal as quickly as possible, but the events companies that still exist might be understandably cautious about putting on big shows if people aren't spending money.

The TV money is going to be our biggest earner regardless and I think that's another sticky topic. How many fans are going to diligently stay at home to watch the matches (as opposed to a few lads getting together), particularly for the games when Liverpool can clinch or other big matches? The authorities will be aware that they cannot police social distancing on that sort of scale so that must come into their decision making about when the cameras can go back on.

 

[pagevee]

For people claiming that the furlough program was established for small businesses only, here is a quick list of major companies using the same "small business" furlough program. (As an American, I don't even know some of the ones listed, I am using UK media sources)
‐--------
British Airways (over 30k/80% of the workforce)
EasyJet Airways (just under half of their workforce)
Greggs
McDonald's
Topshop owner Arcadia
Nissan
Nation Broadcasting
CCUK
Bauer Media
Mace Group (800 employees)
AMC Entertainment (600 employees)
PA Media Group
Reach (publisher for Mirror/Express/Star furlough 20% of staff~940 employees)
JPI Media (350 employees)
Newsquest (10% of 650 employees)
Archant
City AM
Evening Standard
‐‐--‐----
To quote the Chancellor of the Treasury, Rishi Sunak....
"Any employer in the country, small or large, charitable or non-profit, will be eligible for the scheme."

I do not understand the logic behind allowing the owners of your media to use government funds but DL is villified for using the same program.

Using a direct comparison, REACH placed 10% of 4700 employees(around 940) on furlough, cut leadership wages by 20%, and cut wages for all other employees by 10%. REACH claimed 2019 revenue of 702.5 million pounds and 2019 Profit After Tax of 94.3 million pounds. THFC reportadly placed around 40% of the 550 employees(around 300) on furlough, cut leadership wages by 20%, and cut wages of all other eligible employees by 20% (players/coaches are ineligible for pay cuts due to standard contract stipulations). Consolidated 2019 statement (reported June 2019) shows revenue of 460.695 million pounds with an after tax Profit of 68.552 million pounds. REACH makes more Revenue, more Profit, and placed more people on furlough which uses more taxpayer money.

Ask yourself, why are they painting THFC as the villian? Again, Levy cannot cut player/coaches wages without permission.

Tottenham reverse controversial decision to furlough staff until end of May

Spurs have followed Liverpool in reversing their unpopular decision to use public money to pay non-playing staff under the CoronavirusJob Retention Scheme

www.mirror.co.uk

Please notice the picture of Daniel Levy that the Mirror decided to use for this article published yesterday covering THFC reversing the furlough at the club. Unfortunately, this type of hypocritical sensationalism/journalism is what I have come to expect from the UK media. This type of reporting is why I struggle to listen to other posters discussing Levy/ENIC out. The club is well ahead of expectations from when I started following the club with Martin Jol. Levy has absolutely made mistakes. To me, those are primarily with handling Martin Jol's sacking, replacing Berbatov with that kid from Man United, if true that he allowed the Grealish transfer to fall through due to negotiations, AND how he handled announcing this original furlough decision. I don't think the furlough decision was a mistake, I think the handling of the announcement was poor. Levy gave people the ammunition to continue the negative caricature within the media in how this announcement was handled, and that was his mistake.

For another viewpoint, Archer is a oil company refusing to place employees on furlough in Scotland. They are refusing to furlough bc the program Guarantees the jobs. They don't see the demand as an ongoing concern for the rest of 2020, so they are cutting the 130 jobs rather than furlough.

In my mind, this is the alternative to using the furlough program. Employers not furloughing employees should not be applauded unless they have gone on record guaranteeing jobs throughout 2020. Even if they do guarantee for 2020, I shudder to consider what will happen in 2021.

 

[brasil_spur]

There's so much nuance in all of this I find it fascinating.

In a "normal" scenario or if Spurs were being affected by this alone I would totally agree, but if all clubs are taking this kind of financial hit it will do funny things with the value of players. Obviously we don't know how that's going to look at this stage but given Levy's cautious nature I could imagine him not liking the idea of selling a prize asset when the transfer market is deflated. That's to be seen of course.

Our stadium certainly gives us revenue potentials above many other clubs although lots of those events do rely on crowds so there will be some additional lag based on social distancing measures, plus how hard the country will be hit by recession. I really hope that big events get back to normal as quickly as possible, but the events companies that still exist might be understandably cautious about putting on big shows if people aren't spending money.

The TV money is going to be our biggest earner regardless and I think that's another sticky topic. How many fans are going to diligently stay at home to watch the matches (as opposed to a few lads getting together), particularly for the games when Liverpool can clinch or other big matches? The authorities will be aware that they cannot police social distancing on that sort of scale so that must come into their decision making about when the cameras can go back on.

Yeh it is interesting.

There's also a bizarre but yet real scenario where this season gets voided, some of the TV money is returned and then next season starts as if this one hadn't happened. In theory Spurs could actually come out of this better off than if the season had finished and we didn't qualify for CL due to the additional revenue that we shouldn't be getting next season.

If we have good enough relationships with our lenders we could wangle some deferred payments or extended loan terms and be in a position to actually take advantage of a deflated player market. We certainly have form in this regard in the past when teams were struggling to survive.

There's likely to be a flurry of events once C-19 is over with and we could then capitalise further by securing more events for the stadium.

All of this is of course very hypothetical, but if there was one chairman in the PL who is likely to come out of this having made the best of the situation then i would bet money on it being Levy.

 

[Bobbins]

Yeh it is interesting.

There's also a bizarre but yet real scenario where this season gets voided, some of the TV money is returned and then next season starts as if this one hadn't happened. In theory Spurs could actually come out of this better off than if the season had finished and we didn't qualify for CL due to the additional revenue that we shouldn't be getting next season.

If we have good enough relationships with our lenders we could wangle some deferred payments or extended loan terms and be in a position to actually take advantage of a deflated player market. We certainly have form in this regard in the past when teams were struggling to survive.

There's likely to be a flurry of events once C-19 is over with and we could then capitalise further by securing more events for the stadium.

All of this is of course very hypothetical, but if there was one chairman in the PL who is likely to come out of this having made the best of the situation then i would bet money on it being Levy.

That's wildly, madly optimistic.

The absolute opposite of that scenario is far more likely to be true.

 

[ultimateloner]

Spurs is run efficiently as a business under DL. It is also heartless.

We were about to make live harder to the least privileged staff - our own people - when they are facing the hardest circumstances. That is, until media pressure kicks in.

You shouldn't need the law or external forces to pressure you into helping your own people when you can afford it. This is excess greed. If we play hardball to our own people expect the worse from everyone else when we are in need.

Spurs will thrive as a club in the coming decade because its is a mean and lean machine. but that's all it is; a machine. I'm not supporting this club anymore.

 

[robin09]

Spurs is run efficiently as a business under DL. It is also heartless.

We were about to make live harder to the least privileged staff - our own people - when they are facing the hardest circumstances. That is, until media pressure kicks in.

You shouldn't need the law or external forces to pressure you into helping your own people when you can afford it. This is excess greed. If we play hardball to our own people expect the worse from everyone else when we are in need.

Spurs will thrive as a club in the coming decade because its is a mean and lean machine. but that's all it is; a machine. I'm not supporting this club anymore.

Are you angry at the club using the furlough scheme to pay 80% of the staffs wages? Or that the club was not going to make up the other 20%?

Because if I didn't know anything about the issue, your comments would make me think the staff weren't going to be paid at all. By anyone. In reality, at most, we were talking about staff being paid at least 80% of their salaries, while sat at home because the company they work for has closed for the foreseeable future.

If that's your idea of 'hardball', I'd hate to think what you think of all the businesses who've had to fire staff, or make them take mandatory holiday.

 

[BringBack_leGin]

Spurs is run efficiently as a business under DL. It is also heartless.

We were about to make live harder to the least privileged staff - our own people - when they are facing the hardest circumstances. That is, until media pressure kicks in.

You shouldn't need the law or external forces to pressure you into helping your own people when you can afford it. This is excess greed. If we play hardball to our own people expect the worse from everyone else when we are in need.

Spurs will thrive as a club in the coming decade because its is a mean and lean machine. but that's all it is; a machine. I'm not supporting this club anymore.

Is it heartless that ours, the most expensive stadium in the country is also the only stadium being used, freely, for masses of different services to help the NHS?

That was decided long before the initial furlough too, so you can’t even say that it’s anything to do with Par or media pressure.

 

[BringBack_leGin]

Are you angry at the club using the furlough scheme to pay 80% of the staffs wages? Or that the club was not going to make up the other 20%?

Because if I didn't know anything about the issue, your comments would make me think the staff weren't going to be paid at all. By anyone. In reality, at most, we were talking about staff being paid at least 80% of their salaries, while sat at home because the company they work for has closed for the foreseeable future.

If that's your idea of 'hardball', I'd hate to think what you think of all the businesses who've had to fire staff, or make them take mandatory holiday.

My situation pretty much (we’ve not closed, only kept in place the regional managers to keep some visibility). I’ve never had so much money in the bank at this time of the month. All receiving full salary would’ve allowed me to do is save £300 a month more when previously I’ve not managed to save a penny in my current life circumstances as I’d have been working from home, no commute or meetings, despite there being almost no market for my and my colleagues services. In effect, by not being furloughed, I’d have been benefitting financially from a pandemic. I would directly be getting richer from something that is killing people. Where’s the morality in that?

 

[Shadydan]

Spurs is run efficiently as a business under DL. It is also heartless.

We were about to make live harder to the least privileged staff - our own people - when they are facing the hardest circumstances. That is, until media pressure kicks in.

You shouldn't need the law or external forces to pressure you into helping your own people when you can afford it. This is excess greed. If we play hardball to our own people expect the worse from everyone else when we are in need.

Spurs will thrive as a club in the coming decade because its is a mean and lean machine. but that's all it is; a machine. I'm not supporting this club anymore.

I'll see you in a few months mate

 

[Yid-ol]

Spurs is run efficiently as a business under DL. It is also heartless.

We were about to make live harder to the least privileged staff - our own people - when they are facing the hardest circumstances. That is, until media pressure kicks in.

You shouldn't need the law or external forces to pressure you into helping your own people when you can afford it. This is excess greed. If we play hardball to our own people expect the worse from everyone else when we are in need.

Spurs will thrive as a club in the coming decade because its is a mean and lean machine. but that's all it is; a machine. I'm not supporting this club anymore.

 

[pagevee]

Is it heartless that ours, the most expensive stadium in the country is also the only stadium being used, freely, for masses of different services to help the NHS?

That was decided long before the initial furlough too, so you can’t even say that it’s anything to do with Par or media pressure.

Has anyone seen any THFC furlough articles that mention the extent of use the club has provided the stadium facilities to the NHS? Serious question, I don't recall any of the articles I saw mentioning anything positive about what the club is doing. If not, that type of imbalanced reporting does not show any effort at professionalism.

I am interested in knowing the amount of media companies that are using the governments furlough scheme and yet, were hypocritically criticizing the club prior to reversing the furlough decision. Due to the negative PR the club received from the same media, it would be interesting to see if the club had legal options. I am not a lawyer so have no clue about the viability of such a case. I personally consider this type of behavior deplorable and to be a massive conflict of interest. I did not read a disclaimer mentioning that its parent company, REACH, placed 940 employees on furlough within the Daily Mirror article about the THFC furlough reversal. I could have missed it but don't think I did.

 

[Bobbins]

Has anyone seen any THFC furlough articles that mention the extent of use the club has provided the stadium facilities to the NHS? Serious question, I don't recall any of the articles I saw mentioning anything positive about what the club is doing. If not, that type of imbalanced reporting does not show any effort at professionalism.

I am interested in knowing the amount of media companies that are using the governments furlough scheme and yet, were hypocritically criticizing the club prior to reversing the furlough decision. Due to the negative PR the club received from the same media, it would be interesting to see if the club had legal options. I am not a lawyer so have no clue about the viability of such a case. I personally consider this type of behavior deplorable and to be a massive conflict of interest. I did not read a disclaimer mentioning that its parent company, REACH, placed 940 employees on furlough within the Daily Mirror article about the THFC furlough reversal. I could have missed it but don't think I did.

BBC London News is doing a small feature on the stadium being used for the NHS. No doubt the club has put pressure on London media outlets to cover the story in an attempt to generate some positive PR.

As I said earlier in the thread though, none of this matters - absolutely no-one cares. The club does, and has always done, vast amounts of good in the community and for local and national charities and good causes. Almost no-one knows about it because no-one's interested in positive news from either the club or football in general.

 

[spursfan77]

BBC London News is doing a small feature on the stadium being used for the NHS. No doubt the club has put pressure on London media outlets to cover the story in an attempt to generate some positive PR.

As I said earlier in the thread though, none of this matters - absolutely no-one cares. The club does, and has always done, vast amounts of good in the community and for local and national charities and good causes. Almost no-one knows about it because no-one's interested in positive news from either the club or football in general.

The Foundation gets half a million a year doesn’t it. More than any other foundation in the country. Never mentioned though. Doesn’t bother me, it’s not there for that.

 

[buckley]

I care that nothing positive about spurs will reach the red tops it does not fit their agenda anyway F them who cares bigger picture and all that.

 

[Chirpystheman]

He made his billions off a financial mess too, so I suppose what goes around...

A person totalling a £2m car is highly likely to have more than one means of transport, an Enzo certainly isn't purchased for practicality, while the £500 Fiesta might be someone's only way of getting to their job. What's more valuable to that person beyond a simplistic percentage calculation of wealth? Someone might lose a £50m third home but that's a bit different to losing the only roof above your head.

No offence but attitudes like yours are why the super rich love countries like the UK and US, we have a society full of people that utterly defer to class, power and wealth so much that many people actually seem to support them not paying their fair share and call anything against that unchecked wealth to be the 'politics of envy'.

Anyway, glad the club saw the light, hope we don't do a Leeds.

People like me who refuse to poor scorn over someone more fortunate than me. Why should i feel bad for that. Just because someone can afford to do something doesnt mean that not doing it makes them a bad person. Im sure all us in here could afford to give more to charity every year but if youve earned it, its yours to spend however you see fit. Some of the abuse thrown lewis and levy way on social media over this is a joke and smacks of jealousy and envy. You have no idea what class of society i fall in to. It definitely isnt upper class or even middle class. Family grew up in hackney and i grew up in wood green before moving to the poor side of the A10 in enfield. However i was bought up to accept that to a vast degree you get out of life what you put in and not just expecting those who have achieved more to give me a handout. I dont support levy and lewis not handing out their own money but not going to criticise them for not doing so.

Out if interest of Lewis 200 odd businesses and 200,000+ staff they employ. How much money should he give away and why? Saying he can afford too isnt a valid answer