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The new football season is with us and already Paolo Di Canio has become the first Premier League manager to lose his job. With managers coming and going seemingly at the whims of oligarchs and other wealthy individuals, it can be difficult to see how the world of football management is compatible with UK employment law. When a football manager is sacked what are their employment rights? Can they make claims and, if so, why don’t we see more of them?

What employment rights do football managers have?

Like all employees in England, a football manager employed by an English club has the right to seek to bring a claim for unfair dismissal if dismissed subject to various criteria.

Firstly, the manager would need to satisfy the qualifying period of service. Two years service is required if the manager was appointed after 6 April 2012. Given that the average duration of a manager’s employment throughout the Premier League and Football League over the last five seasons is 1.88 years, many dismissed managers would not have the required length of service to bring a claim.

Automatic unfair dismissal

As with other types of employees, a manager would not need to satisfy the qualifying period of service to bring a claim if they were dismissed for one of automatic unfair dismissal reasons that do not require it. These include whistleblowing or family related reasons, such as maternity or paternity leave.

A manager with the required qualifying period of service would benefit from the same protection as any other employee against unfair dismissal. That is to say, in order for a football club to show that dismissal was fair it would need to have a potentially fair reason for the dismissal  and be able to show that it acted reasonably in treating the reason as sufficient to justify sacking their manager.

Dismissal on capability grounds

‘No away win all season? Can’t we just sack him for being rubbish?’ Football supporters and directors of football clubs might seek to justify a manager’s dismissal on the basis that he just isn’t very good at the job. Capability is one of the potentially fair reasons for dismissal, along with conduct, redundancy, statutory restriction and ‘some other substantial reason’. But a run of poor away form is unlikely to be considered sufficient lack of capability to result in dismissal. A manager would likely argue that he is performing his duties as manager of the team as required but the performance of the players is leading to poor results. But – as anybody interested in football knows – it is easier and cheaper to sack a manager than to sack 11 players.

A ‘normal’ employee would often be placed on a performance improvement plan if their capability to carry out their duties is in question. However, given what is often a demand for instant results, the time required to undertake such a plan would not be compatible with the desire to appoint a replacement manager as soon as possible.

Given the nature of football management and the personalities involved, it is difficult to imagine a scenario where a manager would submit to a performance improvement plan.

Can a football manager claim breach of contract?

A football manager is usually appointed on a fixed-term contract, giving rise to headlines such as ‘Mou signs 5-year deal at the Bridge’. As with any other contract of employment, if the terms of that contract are breached, a manager could consider bringing a claim for breach of contract. Where there has been a dismissal, this can be done in either the Employment Tribunal or the civil courts.

Such claims are capped at £25,000 in the Employment Tribunal. Given the sums earned by many football mangers, they would usually look to bring such a claim in the civil court.

Former Blackburn Rovers and Manchester United player Henning Berg was appointed manager of Blackburn in November 2012, to be sacked after only 57 days in charge.  As part of his contract, Berg had negotiated a clause stating that should he be sacked before expiry of his three-year fixed term, he would be entitled to compensation on the basis of his basic salary for the unexpired balance of the fixed term. This claim totalled £2.25 million. When the sum was not forthcoming, Berg began civil proceedings in the High Court for breach of contract to recover the amount owed. Initially, Blackburn filed an admission to the claim and sought more time to pay, citing cashflow problems caused by recent relegation from the Premier League.

Penalty clause

Blackburn subsequently made an application to withdraw its admission on two grounds. Firstly, that the Managing Director – who had agreed the terms of the contract – only had the authority to agree a liquidated damages clause up to a maximum of 12 months salary and secondly, that the clause itself constituted a penalty and was therefore unenforceable.

In respect of the first ground, the court rejected the submission that the Managing Director did not have the authority to conclude the contract. At no point during negotiations was it mentioned that he would require further approval and, on the club’s own website, a statement confirmed that they were seeking to settle Berg’s claim and that, contrary to speculation, there was no investigation into the conduct of their Managing Director, who retained their “complete backing and support.”

In terms of the second ground for the application, the court refused to accept that the clause was a penalty clause. A contract may state that, should one party breach the contract, then they would be required to pay a sum to the other party. If this payment does not bear any resemblance to the actual losses suffered it could be considered to be a penalty clause.

The effect of the clause in question, however, was to entitle Berg to payment from Blackburn if he was dismissed. Blackburn’s dismissal of Berg was not itself a breach of contract but their failure to pay him in accordance with the contract’s terms was. As such, Blackburn’s application was dismissed and they were ordered to pay the sum claimed.

Why don’t football manager’s make claims against their employers?

Beyond drawing attention to the ongoing chaos of the Venky’s regime at Blackburn and providing an example of a football manager successfully making a claim for breach of contract, the Berg case serves to highlight some of the reasons why dismissals of football managers do not result in Employment Tribunal claims.

The bargaining position of many managers is such that they are able to negotiate favourable severance clauses that provide for much higher compensation then they would be able to recover in a Employment Tribunal claim for unfair dismissal, which would be subject to a statutory cap on a compensation award of £74,200.

Also, given the high-profile nature of their roles and the finite number of football manager jobs available, it may often be desirable not to appear to be a difficult employee to potential future employers – especially when managers are often extremely well-rewarded. Similarly, severance clauses are also in the interests of a club wanting to bring certainty and a speedy resolution once the decision is taken to replace a manager.

Mutual consent

An oft-repeated phrase when reporting a manager’s dismissal is that he has left a club ‘by mutual consent’, reflecting that the parties have reached an agreement on the terms of departure. Given the inevitable highly publicised dismissal of football managers, it is often in the interests of both parties to settle the claim by way of agreement rather than publicly through the courts.

While UK employment law does apply to the world of football management, do not expect to see any high-profile managers involved in an Employment Tribunal claim any time soon.

For more information on employment rights or any of the other issues raised in this article or to discuss employment law in general contact our Employment Law team by emailing [email protected].