Lack of success for managers still pays off in payoffs

Posted by - January 19, 2011 - Premier League, Ranting and Raving

Time for a change in managers’ contracts?

Rafa Benitez’s record at Inter Milan does not make for pleasant reading. In 39 games either side of his term, the club lost just three games. In his reign of 23 games, they lost seven times. The Spaniard was forced out of the club, presumably with hurt pride. But however lightened Rafa’s ego, his wallet gained significantly in weight. It was reported that he gained a payoff of approximately £5million, coming just six months after a £3-4million farewell handshake from Liverpool. And Benitez is far from alone. When Schteve McClaren left England under the ‘Wally with the Brolly’ tag, he did so with a cool £2.5million, despite his inability to guide England to a major tournament.

Closer to the present day, and Avram Grant has refused to resign as West Ham manager. Whilst this might be portrayed as a stand of determination, and he has undoubtedly been treated lousily by Gold and Sullivan, it is possibly related to the potential £5million fee he will receive if pushed.

The principles of such a system are found in reasonably basic employment law. Upon taking on a football manager role, you sign a contract. If you break the terms of that contract, you can be dismissed without payoff. If you resign from your position, you gain no payoff. But if the club wishes to relieve you of your duties, then they must pay up the full length of the contract. In reality, many managers negotiate a lower fee.

So the adage remains: money for old rope. And Grant’s refusal to name the club directors who he believes have it in for him may not be the gallant stance it first appears. In doing so he may break the terms of his contract, and therefore not receive a penny. Gianfranco Zola, his predecessor, was sacked for ‘breach of contract’ after declaring his opinion on David Sullivan’s statement that “every player but Scott Parker is for sale”.

These rules evidently allow for inequalities to occur. When Tony Mowbray was sacked from Celtic in March 2010, it was reported that his payoff would be around £1million. However, when Paul le Guen left Rangers just three years earlier, he walked away from the club due to his own poor performance so as not to receive his fee.

The illogicality of such a system is clear. If I was to consistently perform badly at my job (and unfortunately writing about football is not my permanent employment), then I would expect a P45 to land fairly swiftly on my desk. In terms of any extras, a clip around the ear would probably suffice.

In a cynical world, where is the drive and motivation for a manager to give 100% to his job? If they perform slightly below expectation, they will be fired, and the inevitable financial boost will follow. They can then take on another job and earn money from this contract. Clearly clubs are loathed to appoint unsuccessful managers, although Bryan Robson has managed five clubs, and the conspiracy theory above is unlikely to be repeated in practice, but the irrationality is obvious.

The only way in which this situation can be addressed is by altering the way in which the contracts of managers are designed. Instead of being provided with an extraordinarily long deal (see Alan Pardew’s recent appointment at the Toon), should managers not be motivated by clear targets or incentives?

For example, why could Avram Grant’s contract not have stated that if the club spent eight consecutive weeks in the relegation zone, performances would be declared unacceptable and his position would be untenable? If this had been a contract requirement, a payoff would surely not be needed?

The effect of this would be that clubs would think twice before appointing managers, and create realistic ambitions for their clubs. If ambitions were set too high a manager would not sign, knowing he would be unlikely to receive a payoff after being asked to leave.

Maybe I am being all misty-eyed and idealistic. I’m just saying it bothers me that a manager can earn approximately £8million in payoffs for a year of underperformance when you or I can slave away at a desk, dreaming of such a role, and then be made redundant simply because funding no longer exists to continue that avenue of business. Now who’s not with me on that?

  • EBass

    Would it be possible to write in performance requirements for contracts? I.e “We believe this club is capable of finishing in the top 6 every season during your 5 year term contingent upon us providing a transfer budget of 10 million each season. If you fail to meet these objectives you can be sacked with no recompense.”

    Might mean only managers who thought they could seriously achieve the objectives take the job. Then again I suppose its equally possible that club chairmen form a sort of unofficial agreement to ALWAYS write in somewhat unrealistic expectations so as to be always able to sack with no payoff.


  • Jjreade

    I think you’re being misty eyed. Club owners don’t put these contracts together for shits and giggles – they have to to attract the best managers. It’s pretty simple. The club that stops putting them in, and stops offering good terms to managers, doesn’t get good managers, and doesn’t do well.

    So arguing for these clauses is easy, but it’s misty eyed. It’ll never happen. And neither should it either. If clubs jump the gun and sack a manager based on things beyond his control (what irrational players who don’t listen do on the field), after even just a few of such days, and are able to do so without some compensation for the unfortunate manager, nobody would ever manage – and we’d be a lot poorer for that.

  • Daniel Storey

    Well the point is that they wouldnt be able to jump the gun and sack without paying off the manager.

    And you say no one would manage, but why not? If the contract had finacial incentoves for good performance, then a manager confident in his own ability would take on the job. If anything would it not produce more home grown, young, confident managers likely to build reputations as oppose to sub standard managers trawling for payoffs?

    But i accept your points, and was aware it was misty eyed!

  • Stuart Otterson

    In fairness though, sometimes a club will supposedly get a good manager and still not do well, so they can be damned both ways.

  • Stuart Otterson

    I have admiration for Martin O’Neil, his contract at Aston Villa was always yearly and would get renewed for the start of the next season. It’s quite honourable, if his performance is good, it gets renewed, if not it doesn’t and I guess he doesn’t get any compensation. I guess there’s advantages for him as well, if a new club was interested in him he could simply walk away at the end of the season without any difficulty. Course in the end he quit anyway.