Lorna Gibb: Football – A Funny Old Game ?

In particular, employees and employers, whether within or out-with the football industry, owe each other a duty not to act in a way that is likely to destroy or seriously damage the relationship of trust and confidence that exists between them. The type of conduct concerned is broad and in the football context might include, for example, seriously undermining the authority of a manager.

Although not exactly in point, a useful starter that produced one of the most influential rulings in football occurred in 1995 when Jean-Marc Bosman, a Belgian player, successfully argued in the European Court of Justice that the transfer system should be changed so that players, who were out of contract could move to another club without the payment of a fee.

Although Bosman established the right to freedom of contract, much nearer home the 2006 case of Andy Webster is also seen as being of major significance to European football. Webster signed for Wigan when he had served three years of a four-year contract with Hearts, against the wishes of the Edinburgh club. Although he was initially found to have broken his contract, it was decided by the Court of Arbitration in Sport that he had acted in accordance with FIFA transfer regulations which stipulate that a player who signs a contract before the age of 28 can buy himself out of the contract three years after the deal was signed. If a player is 28 or older the time limit is shortened to two years.

A recent 2011 appeal case, that of McCormack v Hamilton Academicals, has reinforced the position that the duty of trust and confidence applies equally to managers and not just players. John McCormack was appointed by the Lanarkshire club as an assistant manager in June 2008 and dismissed for gross misconduct after being just over two months in the job. No contract of employment was ever signed by McCormack although Hamilton contended that his conduct, which allegedly involved various incidents of bullying, swearing and making sexually derogatory comments, collectively amounted to gross misconduct which justified summary dismissal.

The separate incidents when taken individually would not have justified summary dismissal and McCormack was not subject to any disciplinary proceedings, nor was there a written record of warnings having been given to McCormack. The case therefore focussed on whether taken as a whole the related incidents undermined the mutual trust and confidence between the club and McCormack to such an extent that summary dismissal was justified.

It was held by the Court of Session that in terms of the mutual obligation of trust and confidence placed on the club, it had not discharged its duty to keep McCormack fully informed of any perceived deficiencies in his conduct; that he had been wrongfully dismissed and was entitled to compensation.

Another notable Scottish case involved Lou Macari when he was the Celtic manager. This centred on a residence clause in his contract which required him to live within a 45 mile radius of Glasgow. He continued to keep his family home in England, although he had been reminded about his failure to comply with the residence clause, which resulted in a dispute with the then managing director and which contributed to the dismissal of Macari.

It was argued by Macari that the club was in breach of contract as he was not bound to obey instructions given in “bad faith” as the managing director had adopted a manner that was calculated and likely to destroy or seriously damage the relationship of confidence and trust between Macari and the club.

It was held by the Court of Session that an employee who failed to obey a residence clause in his contract of employment and comply with his employer’s lawful and legitimate instructions was in material breach of his contract, irrespective of the employer’s motives in giving those instructions. Moreover, a breach of the implied term of trust and confidence by Celtic did not entitle Macari to withhold performance of his contractual obligations.

Importantly, if an employer breaches the implied duty of trust and confidence, an employee may be entitled to resign and treat himself as being constructively dismissed. Such a situation arose in the 2008 case of Jim McBride when he was appointed as the manager of the Falkirk under-19 team. His duties included daily training, coaching development and team selection but when a Youth Academy Director was subsequently appointed McBride was told, without any discussion or consultation, that this person would be responsible for picking the U19 team.

McBride resigned his post and claimed constructive dismissal. On appeal it was decided that McBride had been unfairly dismissed, not only because he could no longer select the U19 team but also because that decision had been taken without proper consultation with him, in breach of the mutual duty of trust and confidence.

Reference was made to the contention made on behalf of Falkirk that the lack of consultation was associated with the style of management which was the norm in the football world and this meant that the manner in which McBride was treated did amount to a breach of the duty to maintain trust and confidence. However, such an submission was rejected by the Employment Appeal Tribunal.

The McBride case re-emphasised the point that employers have a duty not, without reasonable and proper cause, to conduct themselves in a manner likely to destroy or seriously damage the relationship of trust and confidence between employer and employee.

Football may have The Special One and in some respects the football industry can be said to be special from in the context of employment law. What the above cases illustrate, however, is that the courts and employment tribunals have a distinct place in the resolution of disputes between clubs, managers and players in very much the same manner as that which applies to the general employment relationship.

• Lorna Gibb is an Associate with HBM Sayers