So what does Paid Up or by mutual consent mean?
Well for starters rarely what it suggests, but it is a process where both sides can gain if they play their cards right.
With the player getting their money early and a thirty thousand windfall allowance also negating the National Insurance for both parties there is a benefit before negotiations even start. It is always therefore in a clubs best interest to settle early, if you have the money available of course. Butcher for instance is a no go at the moment until the season ticket and commercial revenue roll in.
The player is normally called in for an initial or one off meeting depending on the amount. All contracts also have an additional month`s money in the last year of the deal to contend with. So therefore a contract that terminates on June 30th will in fact have the best part of 9 weeks to run plus the additional month.
To the negotiation table then???.
So let us take a round £800 weekly wage shall we. The club will have to pay 12.8% National Insurance contribution each week and the player 11%. Plus 23% tax above his tax allowance. So the player will get £712 per week less his tax which equates to £551. The 13 week ‘lump` is then just over ‘7 grand` to the player.
The club will be in for £10,400 to the player and the tax man plus another £1300 NI gross and so wanting to drop that at all costs, reasoning a third would not even go the players way anyway. But just to be clever they will offer the player 5 grand – remember that`s our cash and next years budget.
The player may agree, normally want to meet in the middle at ‘6 bags of sand` or even chance their arm with 8 or 9 grand because they ‘know the game`. (Add up was an unkind term according to the ex Imp we spoke to – for the record not Connor, Gordon or Simon Yeo)
Players at this level also rarely want an agent taking 15% of the trough so a quick call to an accountant to cover the sums will normally suffice. Then it`s a hand shake, a signature (plus another on a confidentiality agreement) and a cheque.
And low and behold cashed has changed hands, the secrets are safe and it`s all smiles as both sides part by mutual consent. The player is then able to move on ahead of the herd safe in the knowledge he can undercut the opposition if need be in a difficult climate.