Legal Opinion: the perils of finding a scapegoat

The plight of sports managers has been in the headlines recently, raising the question of what happens when a team fails to support a manager in the face of derogatory comments and starts courting replacements for their job.

When the Rugby Football Union (RFU) proposed to remove Brian Ashton, head coach of the England Rugby team, and replace him with ex-England captain Martin Johnson, it opened itself up to constructive dismissal claims.

A sports team’s perceived failure on the pitch is often the catalyst for claims. The hunt for a scapegoat then ensues and it is the manager who is the first in the firing line, often with a replacement lined up to move in.

The driving force is the immediate imperative to keep the fans, owners, other shareholders and/or sponsors on board. In many cases, this leads to a cast-iron claim for constructive dismissal.

Press attention leaped on the alleged clandestine meetings between Johnson and Rob Andrew, the RFU’s director of elite rugby. This, in turn, seemed to force the management board of the RFU to appoint Johnson without any agreed strategy as to what Ashton’s future would be.

Ashton took legal advice and remained uncertain as to whether or not to lodge a claim. Eventually, to the considerable relief of the RFU, he accepted the lesser role of director of its National Academy.

The need to take immediate action in these circumstances often overrides any thought as to the legal ramifications for employers. In Ashton’s case, the three key elements of a constructive dismissal were readily displayed to the public gaze.

First, there must be a fundamental breach of contract. Courting and then appointing a replacement is a very good example of how to breach the implied contractual duty of trust and confidence.

Second, the individual must then rely on that breach to resign and maintain that such a breach is the cause of them leaving. The RFU managed to persuade Ashton away from such a course and in so doing, they also ensured that he would fail the third element, that the individual has not affirmed the breach of contract. By taking the new position at the National Academy, Ashton accepted or “affirmed” the breach.

Even with the acceptance of a new role, there are still significant problems with the employer keeping productive relations with the individual who has effectively been demoted. Such scenarios also often leave the employer looking distinctly unprofessional, both internally and externally, where more longer lasting damage can be done. Where there is a need for swift action, there must also be a strategy in place to understand the wider implications of the proposed action.

At the very least, a clear understanding of the options means that everyone involved knows the risks and can ensure that the headlines focus on the new incumbent and not the legal claims of the person being removed.

On the other side of the coin, with senior employees, no-one can dispute that the cap on unfair dismissal damages is still a disincentive to taking any action. The cap, now at £63,000 (plus the small basic award), is often not an attractive solution to their problems when they must also pay their own legal costs, even if they win. A claim for breach of contract and damage to reputation would potentially be more lucrative, but proving both a breach and the losses which flow from the breach is extremely difficult and hence why there is so little case law in this area.

While no one but Brian Ashton and the RFU have a full understanding of what truly went on, it would appear that in the face of these difficulties, Ashton, in the end, took the most pragmatic approach to the options available to him.

Key points

Open criticism of a senior employee while courting others for the job gives clear-cut grounds to claim constructive dismissal,

There are three key elements to a claim for constructive dismissal

  • There must be a fundamental breach of contract
  •  The person must resign because of the breach
  • The person must not have “affirmed” the breach

Swift action to remove senior employees needs an agreed strategy before it gets under way.

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