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COVID-19, Footballers and Furlough Leave

Introduction

Taking a look at the workings of the UK corona virus furlough scheme within Premier League Football Clubs and of football players.

The news of football clubs furloughing its employees has been met with backlash. There has been negative reaction to football clubs implementing the government's measures to assist businesses during this time, especially against the premier league clubs (Liverpool being one, who have since recanted their position due to such reaction). The question must be asked whether such reactions are warranted. There is no similar reaction toward blue chip companies that furlough its staff. British Gas for instance are implementing a rolling furlough of its staff and their company profits dwarf those of even the top premier league teams. Richard Branson was one of the first people, even before the government's measures were announced, to request Virgin staff to take unpaid leave (admittedly, it did not go down well). It should be kept in mind that football clubs are just a business like any other and the sports industry is arguably going to feel the adverse impacts of the virus more than others - a complete halt to game time, no TV coverage, high rents (although still shirt sales and merchandise).

The backlash against football clubs may however be warranted from a moral standpoint based on the fact that premier league clubs announced that they would be furloughing their non-playing staff, whilst continuing to pay their players full wages. This is perhaps were the back-lash has arisen. However, in response to this it should be remembered that players are a commodity. They may have contracts of employment, but the contracts are completely unlike any other employment contract. One player alone can make their club millions in endorsement and sponsorship. A player is the football clubs' investments. In order to furlough an employee, the employee must agree. The PFA has advised players against agreeing to be furloughed and clubs will inevitably be aware of this as they will not want to breach contracts leaving themselves open to claims or (perhaps worse) their players leaving for a different club.

It is good to see that some players at some clubs have agreed to take wage cuts in a show of solidarity with their non-playing team-mates. Barcelona players have agreed to have their wages slashed. Leeds United have too.

Looking to the lower leagues, a player not agreeing to be furloughed becomes more unlikely as cash for lower league clubs can be tight. It is a sad day when a lower league club, a backbone of its local community, shuts its doors, and it is right that these businesses can benefit from the government's corona measures the same as others.

Whatever ones viewpoint, football is quite unlike any other industry, and it is worth asking questions and thinking about the impact and even availability of furlough measures in the world of football.

International Football on 17/11/19 and COVID-19

On 17 November 2019 Harry Winks set England on their way to a 4-0 victory away to Kosovo putting England among the top seeds for the UEFA European Championships in the summer of 2020. It was the beginning of the end for England and their appearance at the coveted tournament for the year 2020.

Interestingly, the 17 November 2019 can be traced back as one of the first reported cases of COVID-19.

There are more important issues than football which world leaders must grapple with.

Ultimately, business does not stop, and football is a business, and it requires key figures, associations, participants and stakeholders to continue to do all they can to preserve the infrastructure of the game we love.

In an unprecedented move the UK government created a furlough scheme; a state aid scheme which seeks to avoid employees being made redundant and subsequently seeking the assistance of the state by way of unemployed benefits. If as a result of COVID-19 employees are unable to operate or have no work they can be placed on furlough leave and in turn the government will pay the lower of £2,500 a month or 80% of the employee’s salary. This scheme is known as the Coronavirus Job Retention Scheme.

Can a Premier League footballer be placed on furlough leave?

COVID-19 has led to the indefinite suspension of English Premier League 2019/2020 season. This has left the twenty member clubs unable to compete. It is not disputed that a footballer generally earns above the national average wage but does that prevent them from being placed on furlough leave?

Generally, the perception is that a footballer’s main function is to play football. As a result of the league being suspended, member clubs are unable to compete, and their employees, footballers, are unable to carry out that function. In this regard, if a footballer was simply contracted to play football but due to COVID-19 they are unable to do so, they qualify for the scheme.

It is appreciated a footballer must keep fit during this period of uncertainty. The next question is whether a footballer who is on furlough leave, can keep fit by training. This hurdle is arguably more difficult to overcome. Under the furlough scheme, an employee is able to undertake training during their leave on the basis they are paid the national minimum wage. Therefore, it could be said that training is the exception and a footballer is able to continue to train in order to keep their fitness levels up during furlough leave as long as the club ensures they receive the national minimum wage. Supporting the position that training is permitted while on furlough leave, is reference to the guidance from the government who state that we are entitled to one form of exercise each day. A professional footballer will also know that it is essential they keep fit if they have been furloughed as once this pandemic is over and they return to work they will be competing with their colleagues. If they return unfit they are unlikely to play ahead of those that are fit. This may lead to a footballer’s professionalism being questioned and may impact their short and long term career prospects.

The hierarchy at a football club may encounter difficulty when delving deeper into a playing contract. The majority, if not all playing contracts at Premier League level, have additional contractual obligations which must be considered. Obligations are generally commercial and include agreements with sponsors, club media, external media partners as well as charities. It may be that the player’s obligation to carry out the contractual obligations remains notwithstanding the suspension of the Premier League. If they did remain, players who carry out those obligations would in effect be carrying out work and for that reason would not qualify under the scheme. Footballers without such obligations, could potentially be furloughed, however, it is important the club presents a proposal to the player and obtains consent in order to then place them on furlough leave. It is perhaps a more realistic option for footballers further down the football pyramid to be placed on furlough leave.

It should be noted, within Premier League football clubs there are some key non-playing staff who cannot be placed on furlough leave. They are generally operational staff such as Chief Executives and Finance Directors whose role remains and must be carried out. Their roles are more important now than ever.

Premier League footballers or indeed, footballers with commercial obligations, are unlikely to be placed on furlough leave, rather, we are likely to see them taking a pay cut or deferring wages. With that said, we must not forget that a lot of footballers support charities, individuals, family members, and placing them on furlough leave may have a greater impact.

Footballers receive unfair criticism on a day to day basis. None more so than in the current climate where they are being scrutinised by some media outlets and politicians. Nobody can dispute some are paid well, however, consideration of the bigger picture is paramount before pointing an uninformed finger. There are further variables to consider that is beyond this blog but the overriding answer is footballers are not immune from being placed on furlough leave, however, in reality those with additional contractual obligations are unlikely to qualify for the scheme.

Source: https://fgsportlaw.wordpress.com/2020/04/05/covid-19-footballers-and-furlough-leave/

This information is in no way to be taken as legal advice or tax advice. It is for information purposes only and is in no way to be relied upon. You should always seek the appropriate professional legal advice before attempting to act on any of the information given here.

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