Don't score an own goal when a key employee moves to a rival - Donna Reynolds
Rubbing salt into the wounds of Berrada’s previous employer, arch-rivals Manchester City, the statement continues “As one of the most experienced football executives at the top of European football, Omar brings a wealth of football and commercial expertise...”
Putting on a brave face, in its own statement, City said “The club understands his decision to look for a new challenge and he leaves with our thanks and best wishes." However, reports suggest Berrada has been placed on gardening leave because of City’s fear of transfer leaks and contract offers.
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Hide AdThere’s no doubt Berrada’s move to the promoted position of CEO is a new challenge, and ‘looking for a challenge’ is an oft-cited (and valid) – reason for employees moving to pastures new. However, there’s also no doubting that, as Chief Football Operations Officer at City Football Group, there’s little Berrada won’t know about past, present and future goings on at the club, including transfer talks and contract negotiations. He was closely involved in high-profile signings including Erling Haaland and Jack Grealish.
This is invaluable information in any club’s hands, not just United’s.
It therefore makes sense that City would place him on gardening leave (as, surely, any employer faced with an employee leaving to join a competitor would). Gardening leave is a contractual right to require an employee, upon giving notice, not to return to the workplace, or have contact with employees, clients or suppliers, for the duration of the notice period.
There are multiple benefits for the employer, but in this case, it denies Berrada access to sensitive and strategic information arising from the current transfer window as well as any important relationships. However, an employer must have reserved itself the right in the contract of employment to implement this strategy.
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Hide AdOf course, if you know you know, and Berrada has been at City for nearly a decade in various roles with access to a plethora of confidential information. No doubt City will have an express duty of confidentiality in their contracts of employment, which serve a legitimate and useful purpose of prohibiting the unauthorised disclosure of confidential information both during and after employment.
In addition, prudent employers expect that, at some point, their senior or highly-skilled employees will be enticed away by what another has to offer, and insure against that risk by including restrictive covenants in contracts of employment.
Designed to prohibit an employee from competing with their ex-employer, or from soliciting, dealing with, or poaching customers, clients, suppliers or former employees of the business by using knowledge of them gained during their prior employment, restrictive covenants can be very effective at protecting information, connections and a stable workforce – invaluable to a business’s success.
They do, however, have to be carefully drafted; justified and sufficiently narrow and relative to the employee’s position within the business, otherwise they are at risk of being more than is necessary to protect legitimate business interests and extending further than is reasonably necessary to protect those interests.
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Hide AdIf Berrada has been placed on gardening leave, and has restrictive covenants, City might then have to reduce the duration of the latter by reference to the time spent on the former.
Change is inevitable in any business, so don’t score an own goal by failing to take steps to protect your business from employee moves – however unexpected they might be.
Donna Reynolds is a Partner, Blackadders
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