The Highlanders have become the first New Zealand Super Rugby franchise to make staff pay cuts as a result of the coronavirus pandemic.

Highlanders staff have taken a pay cut of 30 per cent, but no-one has been laid off.

New Zealand Rugby have announced grants of $250,000 to each of the five NZ franchises, which are under severe financial pressures.

Highlanders chief executive Roger Clark said the money was greatly appreciated, but couldn't stop pay cuts.

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"We are like every other business. When the revenue dries up because you have not got a product, then you can go through money pretty quickly," he said.

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Clark said since a private investment group came on board in 2015 to buy the Highlanders licence, money had been put into the business and reserves had been built up. Those were now being used and employees had been prepared to take the pay cut.

The franchise had also used the Government's wage subsidy system.

He said the Highlanders ran a pretty lean operation, but outgoings were at more than $500,000 a month at the franchise, so that could be chewed through pretty quickly.

Clark said things may have to change, but that depended on the duration of the lockdown. The club was working hard to be ready when the team got back on the field for the rest of the season or in 2021.

When — or if — a season started this year is unknown.

The Highlanders. Photo / Photosport
The Highlanders. Photo / Photosport

New Zealand Rugby CEO Mark Robinson said the $250,000 grant was seen as "a critical supplement to other financing options or levers being considered by the clubs".

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"Super Rugby is a vital part of our rugby eco-system and has a solid 25-year track record as a strong and admired rugby competition that has valuable intellectual property and a legacy of world class rugby," Robinson said.

"These decisions are about protecting the core capability of the Super Rugby clubs so that they are ready to hit the ground running if Super Rugby resumes later this year, and also be in a position to revive and participate in Super Rugby in whatever shape it takes in 2021 and beyond."

The announcement follows the earlier revelation that NZR projects a $100m revenue loss over the next 18 months due to the impact of the Covid-19 pandemic.

Robinson told the Herald NZR had issued sweeping 20 per cent wage cuts across the organisation for the next three months - after Rugby Australia on Tuesday stood down 75 per cent of its staff.

According to Robinson, NZR would also be investigating the structure of all domestic competitions in 2020 once rugby re-starts, through a working group of representatives from provincial unions, Super Rugby clubs, the New Zealand Rugby Players Association, commercial partners, NZR and other key stakeholders.

Covid19.govt.nz: The Government's official Covid-19 advisory website