Friday, June 19, 2009

Sports Law Round Up: Player Contracts

The news story that most intrigued me this week was that Manchester United has implemented a policy that the club will not sign players over 26 years of age, in a move apparently designed to generate value for the club at the end of a five or six year player contract when that player is sold. I am sure that this article screamed out to the sensibilities of sports lawyers as well, as clear discrimination contrary to Article 6 of the Employment Equality Directive (2000/78/EC).

Manchester United are not silly enough to put such a policy in writing, and when questioned by World Sports Law Report, denied its existence. “We sign, and will continue to sign, players of all ages and abilities”, said a club spokesperson. “There is no such policy”. The European Commission also indicated that if the policy doesn’t rule out the signing of older players but submits each proposed signing to a cost against investment calculation, then that may not be illegal. “The Employment Equality Directive forbids discrimination in the workplace on grounds of race, religion, disability, age or sexual orientation”, said a Commission spokesperson. “However, as far as I can understand from the Guardian’s article, you are actually referring to a policy decision based on a cost/investment calculation which does not rule out the signing of older players, but will submit any new recruitment to an assessment of its longer-term financial viability”.

Given that Deloitte’s recent Annual Review of Football Finance revealed massive levels of club debt – which is not a good position to be in given the precarious nature of banks’ lending abilities in today’s economic climate – the above story illustrates that clubs are beginning to carefully examine every investment they make (unless you are Real Madrid). This shift in policy could perhaps have more of an effect that any proposals to limit overseas signings to protect national teams, such as FIFA’s ‘6+5’ idea. A good example of where this has already happened is Scotland. Following the collapse of ITV Digital and a massive reduction in TV payments, Scottish clubs were forced to re-evaluate their economic situation, and many realised that training up young players was cheaper than signing players from overseas. The Scottish national team – which is currently 22nd in FIFA’s rankings – has benefited as a result (although the Scottish Premier League could be put under massive economic pressure if Setanta collapses).

There is a forum where you can discuss these issues further. As you can see from the article below, World Sports Law Report and Hammonds LLP have organised an excellent line up of speakers for Player Issues: Regulations & Contracts 2009. It would be great to see you there.

Andy Brown



dinaki said...

gr8 one.. gr8 blog... good info


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