Terms and conditions – Why rising costs mean it’s time to review yours
The moment a young athlete is offered their first professional contract is one that families often describe as the culmination of years of dedication.
It can also be one of the most legally significant moments in that athlete’s life and one that is often approached without the independent advice it deserves.
Professional sport is, at its heart, a commercial industry. Clubs, academies and sponsors are experienced in negotiating contracts that serve their interests.
Young athletes and their families frequently are not. Understanding the key issues before signing anything is essential.
The issue of capacity
Under English law, the age of full contractual capacity is 18. The Family Law Reform Act 1969 makes clear that anyone under that age is a minor, and that contracts entered into by minors are generally voidable at the minor’s option.
In practice, this means that a young athlete under 18 can, in most circumstances, walk away from a contract, but the other party cannot enforce it against them in the same way they could with an adult.
In football, the FA’s regulations prevent professional contracts from being signed before the age of 17, and representation contracts with agents must be countersigned by a parent or guardian where the player is under 18.
Other governing bodies have comparable safeguards, though these vary across sports. The existence of these protections does not mean the contract can simply be disregarded and on reaching 18, an athlete may ratify an earlier agreement expressly or by continuing to act in accordance with its terms.
What to look for in your first sports contract
Whether the athlete is 17 or 21, the key contractual terms deserve careful scrutiny and the following questions should be asked and the answers considered carefully:
Duration and termination – How long does the contract run, and on what grounds can either party terminate it? Release clauses and termination provisions are areas where athletes can be left exposed if the terms are one-sided.
Remuneration – What is the basic pay, and how are bonuses, appearance fees and other incentives structured? Are the performance conditions realistic, and how is payment handled during injury absences?
Image rights – Does the club or organisation seek to control the athlete’s image or commercial activities outside the sport? These provisions can significantly affect an athlete’s ability to earn from sponsorship and endorsement, which for many will form a substantial part of their income.
Injury provisions – What happens to the contract and the athlete’s pay if they suffer a serious injury? Is there adequate insurance in place, and who is responsible for arranging it?
Governing body regulations – Many sports operate under rules that sit above the individual employment contract, particularly around transfers, agent relationships and anti-doping. Any contract should be read in light of those regulatory requirements.
The role of an agent or intermediary
Many young athletes will be approached by agents before they sign their first contract. The agent’s job is ostensibly to secure the best terms for the athlete, but it is important to understand that agents are paid by commission and that their interests and the athlete’s interests are not always perfectly aligned.
A representation agreement with an agent is itself a contract that needs to be reviewed carefully, and an independent solicitor’s involvement at that stage can be just as valuable as it is at the playing contract stage.
It is also worth remembering that some sports, particularly football, have specific regulations about when agents can be engaged, what they can be paid and how any transaction involving a minor must be structured.
Getting this wrong can have regulatory consequences for everyone involved.
Education and long-term planning
The vast majority of young athletes who sign their first professional contracts will not go on to careers at the top of their sport.
This is not a counsel of pessimism. It is a reason to think carefully about what happens if the career does not progress as hoped.
Contracts that lock a young person in for an extended period or that restrict their ability to move to a better opportunity, should be scrutinised closely.
If you or a family member has been offered a first sports contract, we can advise on the terms and ensure that your interests are properly protected before anything is signed.
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