Home | Contact Us

The process of performance dismissal

17 March 2015

Employment law and the world of professional sports have an awkward relationship. Employment law principles can struggle to make sense when applied to the sporting context. But where does this leave those for whom sports is employment? Should they be excluded from the protections offered by employment law, and if so, how could this be done in a context where strict adherence to the usual rules could end up sinking the ship?

Dean Barker's recent departure from Emirates Team New Zealand exemplifies this struggle faced by those who find employment in professional sports.

Following Team New Zealand's heartbreaking 9-8 loss in the 2013 America's Cup campaign, Team New Zealand reviewed their campaign.

As a consequence of this review, it was decided that Barker should be offered the performance coaching role. However, Barker was adamant that his place was on the water, and he did not accept the offer.

Barker has been paid three months' salary as notice and has left Team New Zealand.

Team New Zealand's chairman, Keith Turner, has described the decision to remove Barker from the skipper's role as part of a restructure.

It is long established in employment law that organisations may restructure their enterprises. Restructuring may occur to make a business more efficient, to abandon unprofitable activities, or simply to reorganise a business. Courts have emphasised that following a restructure it is the position, not the person, that is made redundant.

Glen Ashby has taken the role of sailing director, and Peter Burling has taken over at the helm. From the outside, it is hard to see how the roles have changed. Have the America's Cup results played a part in his departure?

We are, of course, all well aware professional sportspeople have their performance subjected to constant scrutiny. Dean Barker is a person of extraordinary sailing skills. But in an ordinary employment context, hypothetically, could a captain of a losing boat be dismissed on account of his performance?

The leading case between Karl Trotter and his employer Telecom outlined the process for dismissing an employee based on their performance. This included steps such as giving a warning, giving the employee a measurable standard of performance to achieve, and allowing the employee reasonable time to improve.

Hypothetically, if the performance issue was a captain's failure to win the America's Cup, then the reasonable opportunity to improve might be to allow the captain to run another campaign. Readers can no doubt appreciate that this hypothetical multi-million dollar performance plan would be unwelcome.

An alternate view is that professional athletes' performances are already under constant scrutiny. When their employer decides it is in the team's interest to remove that particular athlete, the necessary performance evaluation requirements are already roughly met.

For the most part, athletes and coaches have been reluctant to take a legal route to resolve their employment problems. The result is that the courts have not developed a body of law in this area, and as such there is little guidance on the unique question of professional sportspeople as employees.

The more vigorous fights have often been around the movement of stars in the sporting arena. They are often on big money and are offered an even bigger purse to switch clubs.

The old club has a contract with them which usually includes a restraint of trade locking them in for a period of time. The old club tries to keep them by enforcing the restraint. Presumably matters are settled by the payment of money to the old club because ultimately there is little point in forcing a player to stay in a club they don't want to play for.

Readers will remember the legal dispute involving footballer Michael McGlinchey a Central Coast Mariners player who wanted to play for the Wellington Phoenix. There was a vigorously fought legal dispute between the two clubs before things were resolved.

At the end of the day when things aren't working out from a human perspective, reality is ultimately accepted even if a cheque is involved.

Cullen - The Employment Law Firm was one of the first eleven law firms in New Zealand approved to provide employment law services to Government and the public sector.

  • Subscribe to our Newsletter

  • Designed by Expert and Powered by MoST Infrastructure Platform

    MoST Content Management V3.0.6852