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Duncan Black is a partner at Titmuss Sainer Dechert.
THE LATEST development in the career of football club manager Howard Kendal, who has made a disputed move from Sheffield United to Everton, makes a recent decision by an FA tribunal all the more interesting.
The tribunal was set up following the mid-1994-5 season move by manager George Burley from third division Colchester United to first division Ipswich Town. The tribunal awarded Colchester £135,000 plus interest in compensation.
Tim Higginson, counsel for Colchester, argued that instinct and "feel" should play a part in deciding the sum. The tribunal agreed but it also took account of the starting salary offered to Burley by Ipswich and the fact that Ipswich did not pursue discussions with a third club which demanded £200,000 for a more experienced manager. It did not seek to evaluate the disruption caused by Burley's departure in any exact way, but it did include an amount for the risk of such disruption.
The decision discredits the idea that FA tribunals should follow a mechanistic approach to damage quantification. Instead it will look at the overall circumstances.
In most cases compensation for loss of a manager is agreed between the clubs without the need to go to a tribunal. Often the details are kept secret and this makes it difficult for FA tribunals to know what the going rate might be.
In presenting cases before the tribunal we believe it is helpful to look at the "setting", that is, the special skills of the manager (for example, spotting young players and developing them) which will be lost to his old club, the other managers interviewed by the new club and the reason why they were rejected. The size of the manager's pay is one factor, but as with players, it is not directly related to transfer value.
In response to the increasing litigiousness on this subject, a number of clubs build an agreed compensation figure into a new manager's contract in the event of early departure. But clubs should think carefully about the size of that payment to make sure they are not selling themselves short.