Football manager contracts of employment – key clauses for clubs to consider – Part 2

In part one of this article, Nick Tsatsas explored current trends relating to football manager contracts and analysed key provisions of those contracts, such as duration of contract, termination provisions and release clauses. In part two, Nick looks at some more key provisions of football manager contracts that clubs should consider, including those relating to garden leave, confidential information and post-termination restrictions.

Garden Leave

A Club can attempt to hold a Manager who is being courted by a rival Club to his contractual notice period (or to the end of his fixed term, if the Contract is expressed in that way). However, in such circumstances, relationships will often become strained, and the Manager’s current Club will typically not want the Manager to remain involved in the team’s day-to-day affairs. In such circumstances, and provided the Manager’s Contract contains the appropriate provisions, his Club can seek to place him on “garden leave”. English courts are reluctant, on grounds of public policy, to allow employers (including Clubs) to put their employees on garden leave for periods longer than six to twelve months¹. However, the tactic of placing a Manager on garden leave is commonly used to delay the Manager’s departure to the rival Club, and to increase the compensation being offered for him, rather than stopping his move happening at all.

The effectiveness of this strategy was seen in 2001, in the case of Steve Bruce, who wanted to leave Crystal Palace to join Birmingham City. Less than a year into his Palace Contract (which, amongst other things, provided for a nine-month notice period, and also contained a garden leave clause), Bruce attempted to resign with immediate effect, but Palace rejected that resignation (which would have amounted to a breach of contract), and sought to keep the Contract alive, by continuing to pay Bruce and honouring the Club’s contractual obligations to him. Palace sought an injunction from the High Court to enforce Bruce’s garden leave provision against him and, on the facts of that case, that injunction was granted². Less than a month later, Palace did allow Bruce to join Birmingham, but only after Birmingham had increased their offer of compensation (allegedly from £250k to nearer the £1m Palace wanted)³.

An almost identical scenario played out in 2003 when Alan Pardew sought to leave Reading to join West Ham United. In that case, a deal was agreed at the door of the court, pursuant to which Pardew agreed to (i) remain on garden leave for a month, (ii) not employ any of Reading’s staff or players until the end of the season, and (iii) give an undertaking not to use or disclose Reading’s confidential information. West Ham also agreed to pay Reading compensation of £380k⁴.

Confidential Information and Property

As is evident from the settlement reached in the Pardew case referred to above, Clubs have been aware of the value of their confidential information for some time now. However, the relatively recent rise of companies such as Prozone and Opta is testament to how English football has embraced the data analytics movement, and how much more of an issue protecting confidential information has now become. Manchester City reportedly employs a team of 11 data analysts⁵, and Arsenal is said to have spent over £2m in order to actually acquire an entire sports performance analytics business⁶. Doubtless, the data that Clubs now have access to informs every aspect of the Club’s football operations – tactics, scouting, on-field performance, the physical and mental health of players and, of course, player acquisition. Most, if not all, of this commercially sensitive and valuable proprietary information will be made available to a Club’s Manager for him to use in furthering the Club’s aims, but Clubs will want to be sure that Managers do not take such information with them when they leave the Club. Without the appropriate protections, such information can be easy to copy or download.

It is not always easy to distinguish between confidential information that can properly be said to “belong” to an employer, and the general knowledge that belongs to an employee (and a detailed analysis of this complex topic is beyond the scope of this article). Consider, though, that many Managers, such as José Mourinho⁷, are said to have their own coaching “bible” that is constantly being updated with thoughts regarding training and tactics. Doubtless, such Managers would argue that the information contained in those bibles constitutes their own “skill and knowledge”, which they are free to use as they please. It may be, however, that their current thinking is informed by confidential information that has been provided to them by their Club. In the circumstances, a Club may wish to reserve the right to inspect a Manager’s bible upon his departure so as to satisfy itself that it contains no proprietary information.