The last 48 hours has seen a lot of discussion in sports media about employment contracts centred around the Wests Tigers, Ivan Cleary and the Penrith Panthers. One of the key discussion points has been around the legal ramifications of the Penrith Panthers’ approach to Ivan Cleary who is currently contracted to Wests Tigers until 2020.
Some lawyers and media outlets have suggested that the fact that the Penrith Panthers spoke to Ivan Cleary and then sacked Anthony Griffin amounts to clear evidence that the Penrith Panthers intended to induce Ivan Cleary to breach his current employment contract with the Wests Tigers.
The above suggestion is problematic for a few reasons:
- In employment law, there exists an industrial tort commonly referred to as “inducing breach of contract” where a third party intentionally interferes with the contractual relationship between an employee and their employer.
- The mere fact that the Penrith Panthers spoke to Ivan Cleary, whether it be once or several times, is not enough.
- It has been reported that the Penrith Panthers spoke to Ivan Cleary about whether he would ever be open to returning to the club as its head coach. In that scenario there is no intent by the Penrith Panthers to have Ivan Cleary breach his employment contract with the Wests Tigers by joining the Penrith Panthers during the period of his current contract with Wests Tigers.
- If Ivan Cleary indicated he would be open to re-joining the Penrith Panthers and, in turn, they offered him employment after his Wests Tigers contract legally ends, then the law is clear that neither the Penrith Panthers nor Ivan Cleary have committed any industrial tort nor committed any other act for which they can be sued.
If Ivan Cleary wants to terminate his employment contract earlier than the agreed end date (and assuming there is no early termination term in the contract), then he would have to approach the Wests Tigers and try to negotiate a release. This happens regularly in the business world and usually the negotiations involve some form of monetary compensation and/or other concession (for example, payment of compensation or an agreement to not poach other staff or employees).
At the end of the day, if an employee no longer wants to work for you, any attempt to make them ‘honour their contract’ runs the risk that a disgruntled employee will simply mark time before he/she leaves, or even worse, be disruptive or damaging to the business. It could be better for an employer to demonstrate that everyone is replaceable, that employee departures are not to be feared and that the organisation is resilient enough to manage any employee’s departure, in particular an employee who no longer wishes to be there.
Once Ivan Cleary has negotiated his release then he would be free to negotiate an earlier start date with the Penrith Panthers.
So, provided that the Penrith Panthers have not tried to secure Ivan Cleary’s services for a period of time that he is contracted to the Wests Tigers then, there is very little if anything the Wests Tigers can do by way of successful legal action against Penrith Panthers.
Shane Koelmeyer, Director, Workplace Law
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