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Why Moyes “Leaks” Mattered for Pay-Off Negotiations

First written for and published by LawInSport. Click here to view the original article.

John Mehrzad

PAY-OFF

The financial terms of the David Moyes/Manchester United settlement, which are almost certainly subject to a confidentiality clause, are unlikely ever to be known precisely. The question is whether Moyes may have received more than his £4.5m contractual termination payment?

The League Managers’ Association stepped in to represent Moyes. Whilst Moyes himself adopted a dignified stance, the LMA were hard-hitting, publically calling United “unprofessional with reference to the extensive leaked reports confirming Moyes’ departure even before he was told.

The LMA’s statement is perhaps indicative of where, beyond his agreed termination payment, the battle lines were drawn in pay-off negotiations between Moyes and United.

“LEAKS”

When news surfaced that Moyes was going to be dismissed, United’s response was not to deny it but simply “no comment”.

Around the same time, details also leaked out of alleged player discord. Apparently United substitutes had placed bets on how long Moyes would last in his job and, during the 2-0 defeat to Olympiakos, suggested he should be sent off as United would be better off without him.He was mocked for reading self-help books.Relationships with senior players, such as Rio Ferdinand, Robin Van Persie and Ryan Giggs, were questioned. One of United’s younger star players, Danny Welbeck, even wanted to leave.

REPUTATIONAL DAMAGE

The significance of those “leaks” in legal terms is their impact on Moyes’ reputation and his consequent ability to find another job at a similar level within football.

Moyes would have been able to argue that United breached the trust and confidence owed to him by acting in a manner which has now given rise to a poor reputation.

The “leaks” go further than a manager who failed to secure European football for United, they arguably showed a manager who was unable to motivate and lead world-class players.

Those apparent failings could make Moyes’ return to top-level football, at least in the short term, even harder. We all remember Steve McClaren having to resurrect his career in Holland after his sacking from the England post when the national team did not qualify for Euro 2008.

The issue of reputational, or stigma, damages to a former manager has arisen previously in legal argument. Kevin Keegan sought an award on that basis when he sued Newcastle United. He failed with that aspect of his claim since he accepted in evidence that the publication of the decision vindicating his resignation would restore his reputation. In any event, the Premier League Manager’s Arbitration Tribunal said that an award of reputational damages to him would be “very little”.

COMMERCIAL REALITY

With the Manchester United Supports Trust criticising United’s handling of the situation, Moyes’ sacking gives all indications of being a PR disaster.

Even if reputational damage in pure legal terms would amount to very little, the commercial and marketing reality of the situation is rather different. United will not have wanted to fight this out in public, revealing where and from whom the “leaks” came.

This put Moyes and his legal team in a strong position to argue for additional compensation to reflect his damaged reputation in excess of his £4.5 million contractual entitlement.

His position would be that United’s handling of the situation will keep him out of a similarly well-paid job for years – even if that does not actually turn out to be the case in reality.

Accounting for income from a new managerial role in the meantime, the difference in salary between the sums paid to Moyes at United and a salary in a new role may well be millions of pounds. Given the amounts at stake, therefore, it would be surprising if the “leaks” were not used to Moyes’ financial advantage in pay-off negotiations

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