The New Zealand Rugby Union and the New Zealand Rugby Players' Association have agreed terms for a new collective employment agreement for 2010 to 2012.

The proposed new agreement will feature an agreed domestic competition structure as well as a range of new and updated terms, including an adjusted player payment pool which introduces franchise contracting at Super Rugby and NZRU level and a reduced salary cap at provincial level.

The existing collective agreement, due to expire at the end of this year, was initially agreed in 2005 and ran from 2006 to 2008 with a one-year extension agreed for 2009.

The terms of the new agreement were presented to the NZRU board and provincial union and franchise chairmen and chief executives at a meeting in Auckland.

The agreement remains subject to detailed contract drafting and ratification by the NZRU board, individual provincial unions and franchises, and the Players' Association board and professional players, likely to be concluded by the end of March next year.

NZRU chief executive Steve Tew said the conclusion of a new agreement before the end of the year was a significant milestone and also provided certainty around the structure of domestic competitions.

"Among our key goals for this year were to provide certainty around our competitions both at the domestic level and within Sanzar and complete a new collective agreement.

"The settlement terms represent a significant step forward for professional rugby in this country and reflect the strength of the relationship we have with our professional players," Tew said.

Players' Association chief executive Rob Nichol said players were "rapt" they have been able to reach a provisional agreement on the key terms underpinning the collective agreement.

"The events of the past several months and challenges faced by rugby during this time presented some very real and difficult issues that we had to deal with during this negotiation process.

"We are proud of the fact that we have dealt with those issues and pleased with the results we have all managed to produce for rugby, first and foremost, and for our members."

Nichol said the new structure would provide an "exciting and dynamic" competition.

"Every game will have significant tension and meaning, will be highly competitive and provide a fantastic platform for the players to demonstrate their ability and skills and push for higher honours. The players will love it."

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