Joint statement from the Scottish Rugby Board and Council

Following previous statements on 9 June and 17 June 2018, and comments made by the Scottish Rugby President and Chairman at the Scottish Rugby AGM on 4 August 2018, the Council and Board of Scottish Rugby wish to provide the following update. 

As was noted on 17 June 2018 Lesley Thomson QC, Senior Independent Non-Executive Director and former Solicitor General for Scotland was asked to conduct a full review to look into the sequence of events that led to the recent employment tribunal and matters in respect of its findings.

It was also noted at the 2018 AGM by Chairman Colin Grassie that the Board would also review, with the aid of external independent experts, the use of settlement agreements within Scottish Rugby.

This work has now concluded. The Board have taken appropriate time to fully consider Ms Thomson’s extensive report. The steps taken by the Board throughout this process and the recommendations made by Ms Thomson have also been considered by the Scottish Rugby Council as part of their oversight responsibility.

Both bodies have accepted the recommendations Ms Thomson has put forward and have committed to implementing changes in relevant operational areas and procedures within Scottish Rugby to reflect the recommendations.

These include:

  • Strengthening Human Resource capability and resource at a senior level to reflect the growing scope of Scottish Rugby as a diverse and complex organisation with multiple staffing needs and expanding legal responsibilities.
  • Recognition that settlement agreements are a legitimate facility which should be retained, but are not to be used as part of performance management procedures.
  • Any other use of settlement agreements to be in exceptional circumstances only, with advance approval of the Board’s Remuneration Committee and following ACAS codes of practice and guidance, if they are to be used.
  • An enhanced remit for the Remuneration Committee of the Board providing for: 
  • (i) Reporting to the Committee of performance management issues,
  • (ii) Committee approval for any dismissals of any employee whose initial appointment was subject to Committee approval, and
  • (iii) Committee approval in future of any request to use a settlement agreement.
  • A full endorsement of the decision to conduct a governance review, led by Independent Chair Gavin MacColl QC, to examine governance structures and ensure they are fit for purpose in a modern and transparent rugby environment.

Following on from the commitment made at the AGM to examine the use of off-field settlement agreements, external experts PwC were commissioned to review the 14 off-field settlement agreements entered into since September 2011. They also met with a number of former employees as part of their work.

PwC’s review identified that there were various reasons for making the 14 Settlement Agreements. For a certain number of the Settlement Agreements reviewed, PWC considered that the documentation available did not make it immediately obvious why those Settlement Agreements were considered necessary.  Scottish Rugby provided additional context in this regard.

In relation to the content of the Settlement Agreements themselves, PwC considered them to be in line with what would be expected, such as evidence of independent legal advice received by the employee, evidenced by a solicitor’s certificate contained within each Agreement.

The Board also conducted additional checks on agreements entered into in the same period relating to the early termination of fixed term contracts of on-field non-playing staff, with similar conclusions reached and shared with the Council.

Any future use of settlement agreements will continue to be by exception and only with the prior approval of the Remuneration Committee of the Board.

Scottish Rugby Board and Council, after taking external, independent legal advice and in line with staff privacy policies and data protection legislation, have confirmed that no further information within Ms Thomson’s report can be made public.

Scottish Rugby Chairman Colin Grassie said: “I would like to thank Lesley Thomson QC for her exhaustive report which has helped us to reflect and work through issues raised by this recent sequence of events.

“It is vital as an expanding organisation that we adopt the necessary learnings from this process to enable us to prepare for the next phase of our growth and increasing complexity in various aspects of the game. With the help of independent, external professional advisers we have reviewed relevant operational areas and recognised that improvements needed to be made.

“Following a long and thorough exercise the Board remain clear about its role and having absorbed and acted upon lessons learned, will now move on.

“The Board and Council reiterates its earlier position and the pride it has in the positive culture within Scottish Rugby.”

Scottish Rugby President Dee Bradbury said: “This has been a very significant and useful exercise for us to go through and I am grateful to Lesley Thomson QC for the depth and quality of the review she submitted.

“It is vital that Scottish Rugby continues to maintain high professional standards to support all areas of its business and the wider game across Scotland. The Review has enabled us to focus on areas where we can improve, as well as reviewing current practices.

“This has been a disconcerting period for Scottish Rugby’s hard-working and talented staff and on behalf of the Council I would like to thank them for their continued support.

“As Scottish Rugby grows the time is also right for the governance between Board and Council to be reviewed and updated where appropriate and I look forward to working with Gavin MacColl QC on this important piece of work in the coming months.

“I would actively encourage all our clubs to participate fully in both the consultation process on issues related to player payment and league structures and in due course, the wider governance review.”

Scottish Rugby reaffirms its commitment to developing rugby across the country and continues to work with member clubs to deliver the extensive Agenda 3 programme to help future-proof the grassroots game.

A significant regional restructure programme has been developed and is now being implemented. A successful external and internal recruitment programme has just concluded and details of the newly appointed Regional Directors and Regional Managers were announced this week.

A strong domestic game is vital to provide strong foundations and continue rugby’s important role in local communities and for the nation.

GOVERNANCE

As referenced by the Chairman at the AGM there is a clear need for the governance structure based on the Dunlop Report of 2005 to be updated, to better reflect the growing organisation Scottish Rugby has become and the challenges of administering the modern game.  There are also certain discrete matters that have been referred for consideration by the AGM.

Scottish Rugby operates in a highly competitive and dynamic environment on a global and domestic level. This sporting landscape is constantly evolving and it is imperative Scottish Rugby keeps pace with the speed of change.

Following a briefing from Gavin MacColl QC, Independent Chair of the Council Standing Committee on Governance, the Council and Board have also approved a programme for consultation with clubs on issues related to player payments and league structures discussed at the August AGM, and taking account of the requirements of the Bye-Law changes introduced at the AGM.

The programme approved is as follows:

End September 2018 (previously communicated to clubs in July)

  • Final submission date for club responses to player payment survey.
  • Formal communication from Gavin MacColl QC to member clubs updating on consultation programme and timeline.
  • Finalisation and distribution of 2019/20 Domestic League Structure Survey to clubs. Returns by end October 2018

October 2018 – Collation and analysis of Player Payment & Reward Survey results.
End-October to mid-November 2018 – Collation and analysis of 2019/20 Domestic League Structure Survey results.
Mid-November to end-November 2018 – Governance Committee to formulate recommendations on options/proposals and consultation method/next steps.
6 & 13 December 2018 – Board Meeting and Council Meeting. Decision points on recommendations and next steps on any recommended options/proposals.
14 December 2018 to 10 January 2019 – final consultation period with clubs on any recommended options/proposals (if required). 
17 & 24 January 2019 – Council Meeting and Board Meeting.  Decision point on final proposal to put to clubs and any next steps.
Mid/end March 2019 – SGM to approve final proposal, if required.

The Council and Board express their appreciation for Mr MacColl’s assistance and encourage all clubs to participate in the consultation process.

Mr MacColl has also updated the Council and Board on the approach that he will be adopting to the wider governance review. A small working group will be formed from stakeholders in the game, together with independent individuals with appropriate skills and experience, including governance matters, and chaired by Mr MacColl.

The detailed remit and membership of the group will be finalised in October 2018, with the group starting work formally shortly afterwards.

The working group will operate on a “review and recommend” basis and report to both the Council and the Board.

The review is intended to be wide ranging, taking account of views from within the organisation itself, clubs, stakeholders and other interested parties, as well as considering alternative corporate and governance models used elsewhere.  It is a necessarily longer-term exercise, though the intention is for updates on the Committee’s work to be provided on a regular basis.

Details on how to contribute will be released in due course, after the group has been formally constituted.

Scottish Rugby fully acknowledges the challenges presented following the outcome of the employment tribunal in June. It has acted to address them and take on board the necessary recommendations to improve our processes in the future.

Scottish Rugby remains in great health. We have seen a positive start to the domestic rugby season, good performances from our professional clubs, several significant new sponsors joining or extending their relationship with us and the launch of the new Rugby Development department and its associated appointments to work more closely with clubs in their communities.

As we enter the year to go to the Rugby World Cup 2019 we will continue to work hard to develop and support rugby in Scotland alongside our member clubs and many partners.