The story behind Mark Dodson £887,000 pay-out and why there was 'no alternative'

Dodson announced in January this year that he would be stepping down from the role in the summer of 2024 but ended up going in March following a medical procedure. He was contracted until summer 2025 and his final remuneration package included a contractual payment in lieu of notice.

McGuigan said that Scottish Rugby was duty-bound to pay out the contract.

“It was pretty straightforward in the sense of that was what he was entitled to legally,” said McGuigan, speaking after Scottish Rugby’s annual general meeting at Murrayfield. “So from a legal point of view we would always check that and make sure that we weren’t doing anything other than what was completely legal.

“Mark went off at Christmas 2023, had his operation, came back for about a month after that in March 2024. And then at that point we had a conversation and decided he would leave the organisation.

“We have a legal responsibility to pay out his contract. It was agreed in 2022 [when he signed a contract extension] that we must pay him his notice period. That’s what he got paid. He didn’t get paid anything else.

“He had salary within the year 2023-24, then payment in lieu of notice that was paid in the year but extends into when the 12 months elapse in this financial year, but we account for in the year that we pay it.”

Scottish Rugby announced earlier this month that it had made a loss of £11.3 million for the 13-month period from 31 May 2023 to 30 June 2024. It follows on from the £10.5m loss the previous year. A redundancy programme has since been implemented and 23 jobs have gone and 34 vacancies have not been filled.

It has been a painful process but McGuigan said the organisation was obliged to pay Dodson such a large sum.

“Absolutely no alternative,” he said. “The alternative is that we could be taken to court, which we didn’t want to do, because the circumstances were very clear to us. In 2022 the agreement was if Mark was to leave the organisation he was entitled to these things, and that’s what we paid him.

“I appreciate everybody has got an opinion, and many people’s opinion is that that’s a lot of money. But in this role I’m in, the responsibility is to do what I’m legally required to do. And I was legally required to pay Mark what we paid. No more than that.”

The contract extension Dodson signed in 2022 predates McGuigan’s time in office. He was appointed chair of Scottish Rugby’s operating arm in May 2023, succeeding John Jeffrey who resigned as chair the previous month.

Earlier this year, the Scottish Rugby Union’s custodian board refused to back Jeffrey’s bid to be chair of World Rugby. Without their backing, Jeffrey was unable to stand in the election for the sport’s most important administrative position.

Prof Lorne Crerar, the chair of the custodian board, refused to be drawn on the exact reasons why they didn’t back Jeffrey’s candidacy

“The SRU custodian board decided that they didn't feel they could support John Jeffrey in his application to be World Rugby chair and the reasons for that were intimated to Mr Jeffrey. They would be a matter for him, they were personal to him and it would be inappropriate for me to tell you what they were,” said Prof Crerar.

Crerar said he wrote to Jeffrey in September to explain why they would not be supporting him. Jeffrey said he wanted the reasons in writing and Crerar said he duly obliged.

Speaking in September, Jeffrey said he felt there was a personal grudge against him and said it was “mind blowing” that his own union wouldn’t support him. “To get beaten by my own country is a right kick in the face,” the Scotland great said.

McGuigan and Crerar both spoke optimistically about turning round the union's financial position over the next three years. The aim is to have a significantly reduced loss, in the region of £3.8m, in the 2024-25 financial year followed by a breakeven position in 2025-26 and a return to profit in 2026-27.

Alex Williamson, Dodson's successor as chief executive, will take over in the new year. The 50-year-old joins Scottish Rugby from private equity-owned education provider Inspiring Learning, where he has been CEO since 2019. He is a former CEO of House of Fraser.

In the formal part of the annual general meeting, Haddington RFC’s Keith Wallace was ratified as the new president of the SRU after two years as vice president. He succeeds Colin Rigby whose four-year stint came to an end at the meeting. Wallace paid tribute to his predecessor who was the longest serving SRU president since World War II, his term extended because of Covid.

Hazel Swankie of Dunfermline RFC was elected as the union’s new vice-president, beating the only other candidate, John Brown of Ayr, by 75 votes to 28. She is on course to become president in 2026 and would become only the second female president in SRU history after Dee Bradbury who served from 2018 to 2020.

The financial statements of the Union for the financial year ended 30 June 2024 were accepted by the member clubs.