Football Managers and Employment Law

The managerial merry-go-round has been in full swing during the 2021-2022 season, with 6 of the 20 Premier League clubs deciding to dismiss their manager in recent weeks following poor runs of form.

The most recent of these dismissals, and arguably the highest profile, is Manchester United’s decision to dismiss manager Ole Gunnar Solskjaer after almost 3 years in the job.

Here in the Employment team at MLP Law we naturally can’t help but think about the employment law implications whenever managers are dismissed. In this blog, we cover the relevance of employment law to such high profile dismissals and consider why it can feel like the usual principles don’t seem to apply.

What employment rights do football managers have?

The first thing to say is that football managers, however high profile and however well paid, have the same employment rights as any other employee. This means they have a right not to be unfairly dismissed (provided they have the requisite two years of continuous service) and a right not to be discriminated against, amongst other things.

Unfair dismissal and football managers

In most cases, employees must have at least two years of continuous service to bring a claim for unfair dismissal. This fact alone may explain why we rarely hear about football managers bringing unfair dismissal claims, given that many managers are lucky to be given even two years in a job.

When managers are dismissed, it is overwhelmingly likely that the reason for their dismissal is poor performance. Whilst this can be a potentially fair reason for dismissal, in order to be fair such a dismissal should be the culmination of a proper performance management process, under which the employee is given a reasonably opportunity, over a reasonable timescale, to improve their performance to the required standard. It is not uncommon for this process to take around four to six months, but it can take even longer.

By contrast, most football manager dismissals follow a poor run of results, usually over a matter of only a few weeks. Indeed, it is common for the media to report that a particular manager has been given say 3 games to save their job or face the sack. It is unfeasible for an employer to conduct a reasonable performance management process over such a short period of time, meaning most manager dismissals will inevitably be unfair dismissals.

So why don’t we see more unfair dismissal claims from dismissed managers?

Although not completely unheard of (Antonio Conte being a successful recent example), it is still very rare to hear of a high profile football manager bringing a claim for unfair dismissal, even where it seems inevitable that such a claim would succeed. But why is this?

Perhaps the answer lies in the limit on the compensation which the Employment Tribunal can award in most unfair dismissal claims, which is a compensatory award of £89,493 plus a relatively modest basic award based on length of service.

Such sums are clearly a lot of money for most employees, but perhaps not so for football managers who are often paid annual salaries in excess of £10 million. In that context, it seems unlikely that the prospect of bringing an Employment Tribunal claim would ever be more than a tiny blip on the radar of a dismissed football manager.

Why do we always hear about managers receiving large compensation payments?

A detail which irks many football fans is when an underperforming manager receives a huge pay off when they are dismissed. So why are such large payments made?

The simple answer is that all employees are entitled to notice of termination of employment. There is a statutory minimum amount of notice required, but this is often superseded by longer periods of notice (especially for key employees). Longer notice periods offer stability and security for both employer and employee.

It is likely that in many cases the “compensation” paid to employees on dismissal is in fact their contractual notice entitlement, paid as a lump sum. The fact that these payments involve such eye watering sums is simply a reflection of highly paid top level managers are.

Another factor is that managers typically sign fixed term contracts for one or more seasons. In some cases, the fixed term contract may not include a right for the club to terminate the contract before expiry of the fixed term and may instead be legally obliged to pay up the remaining period of the contract in full if they wish to remove the manager.

Why do managers often leave their club “by mutual agreement”

A termination “by mutual agreement” can mean a number of things in this context. Occasionally it is simply a phrase used to avoid the perceived embarrassment of a dismissal. However, it may also be a reference to the club and the manager having entered into a Settlement Agreement as a means of ending their employment. Such an agreement may be appropriate where there is compensation to be agreed and certain confidentiality restrictions are being imposed.

How could clubs do things differently and save themselves millions?

There are examples in world football of clubs doing things differently, which English clubs could potentially consider rather than shelling out millions after millions to replace their managers every few years.

Clubs in Italy, for example, are famous for keeping managers on their books, effectively on garden leave, for their notice periods rather than paying them a lump sum for an immediate exit. The benefit of this approach is that the club can agree with the manager to waive their notice period if they are offered a new role elsewhere. They could also prevent their former manager from joining a rival, although if they dismissed them for poor performance, this may not be such a concern!

Get in touch with the MLP Law Employment team today to discuss any of the issues raised here or more generally. You can contact us on0161 926 9969 or employment@mlplaw.co.uk, or follow us on Twitter @HRHeroUK.