By Karl Thomas, Senior Associate Solicitor 

Employment contracts (“contracts”) are fundamental in all industries, serving as the foundation block of any employment relationship. 

In sport, contracts between athletes, coaches, teams, and organisations should clearly outline the terms and conditions of employment and reflect the commercial terms agreed.  

Clarity and Expectations

A primary function of an employment contract is to clearly define the roles, responsibilities, and expectations of the parties. 

A well-drafted contract for a coach or athlete will specify duties, performance targets, and behavioural expectations. This clarity is important for maintaining a harmonious working environment and ensuring the parties are on the same page.  

Protection and Security

Employment contracts provide legal protection for both parties. It is a legal requirement for employees to be provided with the main terms of their employment in writing, from the start of any engagement. 

These terms will include salary, benefits, duration, holiday entitlement, sick pay, and conditions for termination. This obligation protects employees during the relationship and sets out what will happen if either party wants to terminate the contract.  

A recent high-profile termination of a contract concerns Warren Gatland’s departure as Welsh rugby coach. Gatland saw his second tenure as head coach end by mutual agreement after a series of disappointing results. 

His contract, which was initially set to run until the 2027 World Cup, is likely to have included clauses that allowed for termination under specific conditions and set out what was to happen upon termination including any right to compensation.  

Nothing is certain, particularly in sport.  Having a contract that deals with what happens if things do not work out as planned, is invaluable.   

Brand Protection

In addition, contracts can also play a vital role in brand protection. Athletes and coaches will often have significant earning potential that relates to their personal brands. 

Athletes may want to protect their own personal brand and ensure that they are able to exploit this outside of the employment relationship. In these circumstances, having the correct contractual arrangements in place is crucial.  

Further, employers may require athletes to comply with media obligations, marketing or community engagement.  If this is the case, the contract should set out what those obligations will be.  

Conclusion 

Employment contracts provide clarity, protection, and certainty for all parties. The case of Warren Gatland and the WRU is just the latest example of how having a contract in place helps manage a relationship during its lifetime and when that relationship ends. 

As the sports industry continues to evolve and professionalise, employment contracts will remain crucial in setting out expectations and ensuring that commercial terms are clear. 

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