SA Racing Operators Slam Jockey Association 'Threat'

In an unprecedented show of unity, South Africa’s three independent racing operators, Cape Racing, Gold Circle and 4Racing, have rejected what appears to be an ill conceived notice of an increase in stakes commissions and implied threats of industrial action made recently by the Coastal Jockeys Association.

The letter, signed by all active currently riding members of the Coastal Jockeys Association (CJA), bar Gavin Lerena, Julius Mariba  and Thabiso Gumede – see a copy here with signatories removed– was clearly a bolt from the blue for the racing operators.

The letter, which will leave egg on the face of the CJA, has been described as being met with ‘shock, disappointment and disgust’ in a response published on 6 April 2023 jointly signed by Cape Racing Chairman Greg Bortz, 4Racing CEO Fundi Sithebe and Gold Circle CEO Michel Nairac.

The response from the operators, addressed to the Coastal Jockeys Association, is carried in its entirety below with the permission of the signatories.

Dear Aldo and Corne

I am writing to you on behalf of three operators of horse racing in South Africa, namely 4Racing, Gold Circle and Cape Racing (collectively, the “Operators”).

As you will notice at the end of this letter, the signatures of the leadership of the Operators are present. That said, I may be writing this letter in the first person from time to time as I have had numerous direct personal involvement with the Coastal Jockeys Association (“CJA”), including recent meetings in my office with the purported leadership of the CJA, namely yourselves. But do know that any personal opinions I may express in this letter are explicitly agreed to by all the leadership of Operators.

We are in receipt of a letter sent by a certain Sharna Pheiffer to Fazela Abhed, the Jockey Remuneration Officer at Gold Circle. Personally, I have no knowledge of a Sharna Pheiffer, but seeing the letter was sent purportedly on behalf of the CJA, and given your roles as the purported heads of the CJA, we can only assume this letter was sent on your behalf.

Similarly, we are assuming that the letter was intended for senior leadership of the Operators. Once again, we must make this assumption because the letter was bizarrely and inappropriately addressed to “TO WHOM IT MAY CONCERN”.

Our collective reaction to the letter, on its face, was one of shock, disappointment and, most prevalent, absolute disgust at the level of disrespect shown.

And this reaction is BEFORE considering your outrageous demands! On a personal level, how is it you both can sit in my office on numerous occasions, work in an open constructive manner together on finding solutions, and then address a letter to “WHOM IT MAY CONCERN”? Where is your respect and your manners?

Did it ever even enter your minds that the letter at a minimum should begin “Dear Mr. Bortz”? Or even better “Dear Ms Sithebe, Mr Nairac and Mr Bortz”? We believe that the leadership of the CJA has already done a disservice to its members by virtue of its mode, means and tone of delivery. And that is before we even get to the demands made by the CJA.

With that said, on a personal level I have lost all faith in the leadership of the CJA’s ability to communicate accurately and faithfully with its membership.

This letter will be circulated directly by the Operators to all the jockey signatories on the letter, and thus it is appropriate that the relevant history of discussions to date is shared with all the jockey members.

Recent History

As you are aware, most recently we have met on three occasions in my office – December 22, 2022, February 8, 2023, and March 15, 2023.

During these meetings I shared with you my concern that the costs being incurred by the Operators on behalf of the jockeys was out of control and unsustainable. The key issues discussed, and the outcome of these discussions are listed below:

1. I explained that the Operators are inexplicably paying for medical insurance for jockeys, despite the jockeys NOT being employees of the Operators. The Operators do not even provide medical insurance to their own employees, so I was at a loss as to why the Operators provide medical insurance to jockeys, who are independent contractors and not employees.
2. I explained further that, to make it even worse, the Operators are even paying for insurance for jockey’s dependents for a vast number of jockeys(such as yourselves).
3. I pointed out that to make matters worse Operators are paying for an expensive plan for most jockeys and are even paying for Vitality for many
4. I explained that jockeys have ABUSED permanent disability policies by treating these policies as their “retirement fund”. This abuse has led to costs spinning out of control, and of great concern the jockeys now, as a group, becoming uninsurable. This has increased the Operators’ costs even further.
5. Your response to items 1 -4 above was that the jockeys had not had an increase in riding fees in a long while, and that you wanted more money. Notwithstanding that these benefits you were receiving (paid medical insurance and temporary and permanent disability) are costing the Operators more every year.
6. You pointed out that the Operators paying for jockey insurance was simply expected by the jockeys, and that they did not understand or appreciate that it was a benefit in and of itself.
7. I pointed out that Cape Racing had increased its stakes significantly, and, as a result, many of your members’ earnings had increased impressively as a result.
8. Your response was that while the top jockeys had indeed benefitted from the stakes increase, the less successful jockeys were not enjoying similar increase in earnings, and they are more focused on the riding fee than the stakes.
9. My response to you was that the Operators would be open to increasing riding fees, provided cost savings could be achieved in items 1 -4 above.
10. Our meetings were spent looking at the various permutations to allow us to save in certain areas and to pass those savings on to the jockeys in the form of increased riding fees.
11. I provided you with an open summary of all our costs, so that we could work through the economics together.
12. At the third meeting held on March 15, 2023, we reached an agreement. We shook hands on the agreement. The agreement was as follows:

– increase in riding fee by R100 per ride (from R1,000_to R1,100)

– reduction of riding fee by 50% for the winning jockey in the race

– the Operators to reimburse for the Classic Saver medical insurance plan only (jockeys are free to keep / upgrade their plans, but the Operators would cover the cost of Classic Saver only)

– the Operators to cease covering Vitality

– no new jockeys to receive medical insurance going forward

As I said, we reached agreement on the above.

That night, I sent both of you (Aldo and Corne) a message summarizing these terms.

13. The next day, March 16 2023, Aldo sent me the following message (copied and pasted) saying “Morning Mr Bortz.. thank you for the message. I’ve run these numbers and we still stuck in same place. We’ve just reshuffle the deck. We going to need to do this again. Unfortunately.”
14. The day after, March 17 2023, Aldo sent me the following message(copied and pasted): “There’s been a lot of wanting to come to stand still but I think emotions were just running high yesterday and Corne has since asked them to just give us some time to try calculate how we can make this work”

I have had no further contact with the CJA since then.

Based on the last message received, I was under the impression the CJA was working through things before we would sit down again.

To go from “give us some time to try calculate how we can make this work” to a “TO WHOM IT MAY CONCERN” letter with demands and a threat of industrial action was, to say the least, unexpected and not well received.

Demands of the CJA

The CJA demands in its letter of March 24, 2023, are the following:

1. A 20% increase [NOT a 2% increase] in share of winning stakes payable to the winning jockey (from 10% to 12%)
2. A 29% increase [NOT a 2% increase] in share of place stakes payable to the placed jockey (from 7% to 9%)
3. The Operators to adjust the deductions accordingly in its system
4. Failure by the Operators to comply and to adjust the stakes deductions as set out in 1 and 2 above to result in no jockeys being willing to ride from April 20th onwards.

Reaction to the CJA demands

As should be clear from previous comments above, the demands of the CJA are poorly received.

The CJA not only has presented its demands in a disrespectful, unprofessional, amateurish manner, but has made demands which are completely out of touch with the reality of the situation.

The Operators collectively have in recent history faced a multitude of financial issues. Serious financial issues. The issues are plentiful and ongoing. As you know, the predecessor to 4Racing (Phumelela) filed for business rescue, and 4Racing continues making losses. Gold Circle’s financial woes have been well publicised and are significant and extreme, and is running out of capital, and fast.

Furthermore, Cape Racing faced an imminent business rescue of its own and was literally saved the day it ran out of money. Cape Racing, like the other operators, faces its own financial hurdles.

In short, the Operators collectively cannot and will not survive unless passionate people generously donate money to keep the sport alive. There are but three such people at present – the shareholder of 4Racing, Owen Heffer and me. That is it! But for the generosity of the three of us, no Operator would be in business today. If any of the three of us walked away right now, racing would cease in the country. That simple.

Yet, with that in mind, the CJA threatens industrial action unless it receives a greater share of the stakes on offer? Talk about being arrogant, misguided, unprofessional, presumptuous and out of touch! To say the least!

Racing’s horse population has dwindled. It has dwindled because breeders stopped breeding. Because owners stopped buying. Because the economics of owning a racehorse were too terrible. As a result, the number of races fell (not enough horses), and the number of horses per race fell. All this meant that the opportunities for jockeys fell too.

Our intervention has given the sport a chance to survive. Has given jockeys an opportunity to ride more. Has given jockeys an opportunity to earn more. Has given jockeys an opportunity to have a career!

But for our VOLUNTARY generosity, all jockeys (and trainers, grooms and others in the industry) would be unemployed.

We also would like to spotlight the hypocrisy of the CJA. When I pointed out the increase in stakes having benefited the jockeys, I was promptly told that this only benefited the top jockeys, and that the riding fee increase was needed to benefit all jockeys. Yet the demand letter of the CJA is focused on giving more stakes to jockeys – which, according to your own words, only benefits the top jockeys! How does this help the less successful jockeys?

You can’t have it all ways! You cannot claim that the generous stake increases don’t count because it favours but a few, and then your response is to demand more of these stakes for yourselves (i.e. the top jockeys)!

So, your STRIKE letter addressed to “TO WHOM IT MAY CONCERN” demanding that we take away from the owner to give to the jockeys is rejected in totality.

We are helping the industry on a voluntary basis. We will not bow to any threats of any kind. Ever. We do not need to be here. We will walk away long before we bow to threats. Please understand that. You cannot and will not force anything out of us.Ever.

Our proposal

We understand that the world, and South Africa in particular, faces challenging economic times. We understand that inflation is rife, and day to day life is more expensive. We understand that jockeys would like to earn more money. We are not unsympathetic.

That said, the only way we could ever possibly reach an agreement is through constructive, positive, reasonable face to face discussions. We are willing to continue those discussions, with the dual objective of:

– increasing riding fees to jockeys

– reducing the insurance and insurance related costs to the Operators

April 20th onwards

Unless or until we receive proactive and direct communication from the CJA looking to meet in person, we will be under the assumption that none of the CJA jockeys will be riding on and from April 20th.

The Operators will be instructing the NRB today to fill the fields from April 20 onwards only with apprentices and work riders and non-CJA jockeys. We will begin making those preparations. If there are insufficient riders to race, we will cancel racing if need be. Ed –See NRB letter to trainers – click here.

And be aware, if we cannot fill fields with work riders and apprentices, and racing gets cancelled, the Operators will be in breach of our international betting and broadcast commitments. Which in turn increases the likelihood of us shutting our doors permanently.

But seeing that this is purely a passion project for the three investors, we would prefer to shut it all down rather than deal with anyone who feels they can hold a gun to our head. Be in no doubt about that.

That said, it is not too late to re-engage in dialogue and to do so in a positive appropriate manner.

Obviously, that re-engagement can only commence with the formal and unequivocal withdrawal of your unfortunate letter of 24 March (effectively received twelve days later on 5 April).

Considering the unambiguous response that you have received to your “letter of demand”, and the disastrous consequences that will arise therefrom, it is incumbent upon you to urgently engage with your members. We have serious doubts as to whether those consequences are fully understood. Furthermore, even more concerning are reports that certain of your members were not aware of what they were signing, while others claim that they were told that these demands were supported by myself!

We would also caution you that a good number of your jockeys may be at risk of seriously imperilling their sponsorships and retainers because of your demands and approach. You should reflect on that carefully.

I for one hope you can reflect on your current approach, and quickly come to your senses and request a meeting. This is solvable but needs to be handled in the right way.

We look forward to hearing from you.