UK Law and Practice Contributed by: Alistair McHenry, Sofia Antipatis and Rebecca Dods, Tyr
Salary Caps and Financial Regulation Several UK sports use salary control mechanisms, though their structure varies: • Prem Rugby operates a long-standing salary cap, set at GBP6.4 million for 2025–26, with credits for home-grown, international and long-term injured players, plus one exempt “marquee” player. • Football does not use a traditional cap at elite level. A salary cap for League One and League Two intro - duced in 2021 was removed following a legal chal - lenge. The Premier League instead uses a squad cost ratio, limiting spending on wages, agent fees and transfer amortisation to a percentage of club revenue. Debate on a formal cap continues. • In cricket, the Hundred applies salary caps in both men’s and women’s competitions, with women’s salaries rising significantly as part of wider profes - sionalisation. Restraint of Trade and Competition Law Considerations Salary caps and spending limits can engage restraint of trade and competition law, particularly where they restrict earning potential or contractual freedom. Gov - erning bodies must demonstrate that such measures pursue legitimate aims – such as financial stability or competitive balance – and are proportionate. 7.2 Employer/Employee Rights Employment law applies fully to NGBs, clubs and associations in the UK, although the status of athletes varies between sports. Where an athlete is classified as an employee, statutory protections such as unfair dismissal rights, family-related rights and protection from discrimination apply. Many sports contracts incorporate arbitration provisions, and employment- related disputes are frequently resolved through these mechanisms. Upcoming reforms under the Employment Rights Bill – expected on 1 January 2027 – are expected to require organisations to update internal policies relating to dismissal, family leave and harassment prevention. These provisions will apply to sports employers in the same way as other UK sectors, and governing bodies may need to adapt their procedures to ensure com - pliance. It is likely that all football managers will be
to be bound by the organisation’s rules. This gives broad powers to impose sporting and financial sanc - tions, including suspensions, fines, disqualification of results and removal of titles. These sanctions are enforceable under the body’s regulatory framework and, where necessary, can be supported through the enforcement mechanisms provided by the Arbitration Act 1996. Parties subjected to sanctions have established routes to challenge these sanctions. Most sports maintain internal appeal procedures that allow decisions to be reviewed for fairness, proportionality or proce - dural error. Where internal processes are exhausted or where the rules permit, disputes may be referred to independent arbitration, typically through Sport Resolutions or the CAS. Only in rare cases, such as allegations of procedural unfairness or jurisdictional overreach, will the national courts intervene. The long- awaited verdict on the dispute between the Premier League and Manchester City may raise interesting questions about sanction and its effectiveness in cir - cumstances where the seasons in which the charges arose have long since passed. 7. Employment Contracts and Rights 7.1 Sports-Related Employment Contracts Relationships between UK sports organisations and athletes vary significantly by sport. In major profes - sional team sports such as football and rugby, play - ers are typically employees, reflecting the high degree of control clubs exercise over training, schedules, performance standards, discipline and use of facili - ties. In football, this is mandatory: both the Premier League and The FA require professional players to be employed rather than self-employed. Player contracts usually combine collectively agreed terms – agreed between governing bodies, clubs and player unions – with individually negotiated provisions such as salary, bonuses, image rights arrangements and contract duration. In contrast, athletes in indi - vidual sports (eg, tennis, athletics, boxing) are most often self-employed, earning income through prize money, appearance fees, sponsorship and personal commercial deals.
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