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With Nowhere Else to Go, Toto Wolff Forced Lewis Hamilton Into a
‘$20,000,000 Pay Cut Salary’ in the 2021 Season
Sabyasachi Biswas|Published July 25, 2023

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Despite $50,000,000 on Table, Ferrari Can Still Poach Lewis Hamilton as
Toto Wolff Not Agreeing to a Key Demand
Credits: IMAGO / Nordphoto

Lewis Hamilton faced a highly unusual situation while signing the 2021
contract with Mercedes. The British driver, who spent eight years with
the Silver Arrows then, had to take a 45% pay cut. The cut then left him
with $20,000,000 to take home.

According to Business F1, Hamilton was furious over it. As he joined the
team back in 2013 and helped to deliver seven back-to-back constructors’
championships by 2020, he naturally believed he was worth more.

This has come along with his seven world titles, which altogether made
him believe that he is worth a lot more and certainly deserves a raise.
The Business F1 further reported that the Briton also threatened to
leave the team if his demands were not met.

Adamant Lewis Hamilton wanted a pay rise, Wolff was reluctant
Despite a series of negotiations, Hamilton remained adamant about his
salary. He wanted the rise from $35 million to $40 million in the next
contract. However, team principal Toto Wolff was unwilling to increase
the amount.

Instead, Wolff cited the pandemic back in 2020 and the unfair
distribution of the salary. Pointing at these, he stayed prominent on
the pay cut. Eventually, the Stevenage-born driver agreed, but the
report by Business F1 said that Hamilton accepted the deal because he
had nowhere to go.

Given, Sainz had already signed for Ferrari back then, that left the
Silver Arrows ace without a prominent seat for the next season.
Furthermore, the Mercedes boss knew the W11 was superior to any other
challenger in F1 back then.

This was added after the British driver was replaced by his compatriot
George Russell following the former’s Covid-positive status. It showed
how a young driver like Russell can dominate the race in a Mercedes.
Hence, Hamilton would think twice before leaving the team, and that made
Wolff confirm to people that $20 million was all he could do.

The contract negotiations created a lot of tensions
Even though Lewis Hamilton is still with Mercedes, the contract
negotiations back in 2021 created a lot of confusion and tension. And it
was so difficult and so long that it started in summer and lasted
through all winter.

Admittedly, reports say that the current contract negotiations are going
through the same, as Hamilton is still to sign his Mercedes contract.

Despite multiple reports of the Briton signing his extension by the 2023
British Grand Prix at Silverstone, there are still lots of confusion
surrounding the seven-time world champion’s stay with the Brackley-based
team.

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About the author

Sabyasachi Biswas
Sabyasachi Biswas

Sabyasachi Biswas is an F1 journalist at The SportsRush. With over one
and a half decades of love for the sport and five years of experience in
the field, he dreams to be a regular at the paddock when the lights go
out. A Red Bull fan and F1 fan in general over the years, he enjoyed
watching Felipe Massa, Sebastian Vettel, and Max Verstappen dominate the
track. Apart from F1, he's also a big-time Madridista and Federer
fanatic. He was a sub-junior level footballer, won inter-district
quizzes and debate competitions back in school. A travel freak
throughout, he tries different cuisines and learns new cultures whenever
he's away from the keyboard.

Read more from Sabyasachi Biswas

On 7/26/2023 2:12 PM, a425couple wrote:

> Nowhere Else to Go

Aww... Poor widdle...

At least Toto finally grew a pair.

https://www.youtube.com/watch?v=JIymxwyDhiw

Love that they want to save money buy reducing tires but do nothing about salaries. If they wont cap them then they should at least put in a "tax" like baseball and some others use.

XYXPDQ <qwrtz123@gmail.com> wrote:
>
> Love that they want to save money buy reducing tires but do nothing
> about salaries. If they wont cap them then they should at least put
> in a "tax" like baseball and some others use.

Without more significant change, that simply won't work. The current
contractual arrangements separate out their Team responsibilities under
contract from their own personal sponsorship. If you put a cap on wages
or tax them, the money would shift.

For example, if Max is receiving 20M (I have no idea and don't want to
look it up as it doesn't matter for this example) in wages and a further
30M in sponsorship this year and the sport imposes a 10M cap on
wages...the team has a quiet word with their sponsors and 10M of team
sponsorship magically appears in personal sponsorship direct to Max and
he's back to 50M, but that's 10M from the team and 40M in sponsorship.

The only way I can see of fully enforcing a wage cap on drivers would be
to have them as full employees with all sponsorship going through the
team, and that's something the drivers would never accept these days.

Why should they?

On 28/07/2023 10:31, Mark wrote:

> The only way I can see of fully enforcing a wage cap on drivers would be
> to have them as full employees with all sponsorship going through the
> team, and that's something the drivers would never accept these days.
>
> Why should they?

Because they'd be punted and somebody less greedy would get to drive
their car.

Calum <com.gmail@nospam.scottishwildcat> wrote:
> On 28/07/2023 10:31, Mark wrote:
>
>> The only way I can see of fully enforcing a wage cap on drivers would be
>> to have them as full employees with all sponsorship going through the
>> team, and that's something the drivers would never accept these days.
>>
>> Why should they?
>
> Because they'd be punted and somebody less greedy would get to drive
> their car.

Are you kidding?

By that logic, it would all be easy...but it's not.

It's not greed: any racing driver has a shelf-life and they need to make
money while they can. Why should the FIA and teams get rich while an
artificial ceiling is placed on drivers' wages? That's not just the race
weekends and development time, it's finding opportunities (easier for
some than others) to endorse products & services as well as being paid
for personal appearances.

The lower-ranks could be cajoled (and are) into signing contracts where
they don't control these rights. Attempting to force drivers to solely
have income via the team just isn't realistic. They have a right to
exploit their time in the spotlight to the best advantage. That's good
for the sport as well as them individually.

Finally, teams will always look to recruit the fastest driver available
to their budgets. They might like to even up the playing field and
reduce costs, but not if it limits the top-end talent available. The
gap in value from the least "valuable" driver (think "pay driver"
through to proven winners) would grossly distort the running costs for
the rest of the team. This hasn't been done without thought, and clearly
that's unpalatable for the sport.

Trying to cap driver incomes would be the death-knell for the sport. It
shouldn't - and won't - happen.