Galling season for Van Gaal; Employment rights for football’s top managers

Monday 16 May 2016

After being eliminated from both the Champions League and the Europa League, plus their recent failure to beat West Ham, Manchester United are on the cusp of failing to qualify for the Champions League after United’s destiny was taken out of their own hands. Louis van Gaal could yet face the humiliation of missing out on European football next season altogether. Calls for the United boss to be sacked are increasing. Rumours of a “Mourinho Manchester” are flooding the back pages; piling the pressure on the Dutchman. So what happens when a football manager is dismissed? Like employees in England and Wales, football managers’ sign contracts of employment and when they are dismissed prematurely they will demand compensation.

Options available

Were Van Gaal to be sacked after 19 May 2016, he could bring a claim for unfair dismissal to the Employment Tribunal as he will meet the two years qualifying service criteria. However, it is highly unlikely Van Gaal will lodge in the Employment Tribunal as the maximum statutory award is £78,962 for unfair dismissal and £25,000 for a breach of contract claim. Hardly fit for purpose when his contract is worth £7.3million.

A breach of contract claim can be brought in civil proceedings where there is no limit on damages. However there are high costs that come with civil proceedings and adverse publicity clubs and managers will be keen to avoid.

The Premier Leagues Managers Arbitration Tribunal (“MAT”) is favoured by Premier League Mangers. The tribunal, made up of barristers who are experts in sports employment law with a good understanding of the football industry, was chosen by managers such as Alan Curbishley, Kevin Keegan and Martin O’Neill who all successfully settled their disputes with their respective clubs.

Protection

The best protection a manager can give himself is a well drafted contract of employment. Henning Berg, manager of Blackburn Rovers for 57 days successfully brought an action for breach of contract for £2.25million when the club refused to honour his contract. Berg’s contract contained clauses that ensured he would be entitled to a sum equal to his gross basic salary for the unexpired balance. Berg’s use of the High Court served his purpose, but the adverse publicity it attracted will ensure other football clubs do not repeat the same mistakes made at Blackburn.

Settlement behind closed doors is the favoured approach of Chelsea owner Roman Abramovich. Chelsea’s traditional approach has been to offer lucrative settlement packages to dismissed managers and since 2003 Abramovich has shelled out compensation in excess of £90million. Chelsea’s latest casualty Jose Mourinho reportedly received a severance package worth around £12million. Nothing to be sniffed at, and certainly more fit for purpose than £78,962.

Solution

Gary Neville has advocated that a ‘Manager Transfer Window’ would provide managers with much greater job security. It would mirror what is in place for players and ensure that when managers are appointed at the start of a season, they will at the very least be able to remain in charge from 1 September until 1 January and should they survive the January transfer window then they would remain in their post until 1 July of that same season. Neville would certainly have benefitted from this policy at Valencia, where he was sacked after just four months in charge.