Coaching Contracts and Non-Compete Clauses

Submitted by The Mad Hatter on December 4th, 2015 at 3:20 PM

As some of you may be aware, Michigan recently had a DC leave Michigan for a HC job.  Now that my rage at that event has subsided a bit, I got to thinking about the contracts that coaches work under, both HC's and assistants.

It's common knowledge that many HC contracts contain substantial buy-out provisions to discourage a coach leaving before his contract is up and to provide a level of income security for the coach in the event that he is fired.

What I'm wondering is why the school's don't add in a non-compete clause to the contracts?  Not something so broad as to say you can't be a coach anywhere after you leave, but maybe something that would prevent a coach from taking a position at direct competitor?

It would seem to give the school hiring a coach from a rival a distinct competitive advantage due to the institutional knowledge the coach brings with him.

 

Discuss.

 

Comments

Canadian

December 4th, 2015 at 5:36 PM ^

I think it's more of a surprise as most of us thought we'd have the same staff (in all aspects) for at least two seasons. I didn't think Durkin would be leaving for 3 years but still have all the faith in the world in one Jim Harbaugh to find the next DC to improve his defense.

I would argue that Durkin being hired this quickly may help Michigan be more attractive to a DC that has aspirations to be a head coach.

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cheesheadwolverine

December 4th, 2015 at 4:15 PM ^

Really?  I know nothing about this, but I would think that CFB coaches are in a strong enough bargaining position that any contract terms wouldn't be procedurally unconscionable, even if they were substantivly unconscionable.  These aren't Jimmy John's sandwich makers, they're sought-after people with agents and lawyers.

 

 

bcnihao

December 4th, 2015 at 10:33 PM ^

In other arenas, noncompeition clauses are sometimes used in the employment contracts of key personnel, and they're upheld if they're not too broad.  (Factors have included things like geographical range, length of the noncompete period, and the type of activities prohibited.)  I don't see why a noncompetition clause that prohibited an assistant from leaving one school to take a position with any another school in the same conference--or a few other, specified schools--would be unenforceable.  It's not as if the clause would prevent the assistant from being able to make a living if he left.

ypsituckyboy

December 4th, 2015 at 3:33 PM ^

Non-compete clauses are being treated with an increasing level of scrutiny by courts these days. Some states are close to getting rid of them entirely due to the restraint they place on trade.

That being said, even if a non-compete is enforced, it usually has to be limited with regard to duration and scope (usually geography). Anything more than a year is frowned upon as a rule of thumb and usually anything over smallish mile radius is frowned upon unless it's a very specialized field (YMMV based on a state by state basis).

That's spitballin it a bit, but mostly accurate.

Callahan

December 4th, 2015 at 3:30 PM ^

Who would sign a no compete clause in an assistant coaching contract? It would likely be unenforceable unless it was really limited in scope, like going to a school within the conference. Even then, you'd limit your candidates to the guys who are just happy to have a job.

BiSB

December 4th, 2015 at 3:32 PM ^

Courts are taking an increasingly skeptical view of non-competes. The general rule is that you can't just restrict "competition."  You can only restrict unfair competition. And even then, you can only restrict it for a reasonable time and in a reasonable scope. It's possible a court would uphold something like "you can't coach for another Big Ten school within 6 months of leaving," but I doubt it. Also, no coaches would agree to something like that.

NRK

December 4th, 2015 at 4:22 PM ^

Actually, that's a relatively reasonable clause given a lot of the case law. That being said, nearly all of these get negotiated away before a judge has to rule. Judges don't like to put people out of work so there's a lot of pressure to get these done some other way.

Farnn

December 4th, 2015 at 3:36 PM ^

This outrage about Durkin going to Maryland is absurd.  This is what happens when you have good assistants, they leave for better jobs and sometimes ask people they have worked with to go with them.  Remember last year all our lists of potential Harbaugh hires and the large number of Stanford/49ers assistants on that list?  And how many of those did we get?  Durkin would be negligent if he doesn't try to talk to coaches at Michigan for spots at Maryland.  If they are good enough, Harbaugh will keep them, if not they have a right to go to Maryland for a bump up in responsibility.  Remember Durkin has a lot more ties to Florida and will probably get a lot of his assistants there.

I can't imagine Harbaugh is upset by this, all reports indicate they are very close and Durkin held out on multiple lucrative offers last season until Harbaugh got the Michigan job.

TIMMMAAY

December 5th, 2015 at 10:08 AM ^

And you're dumb if you truly believe that it didn't. This isn't some 40 hour week job stocking shelves, it requires complete dedication. That's why they get paid big money, it is all consuming. For him to take time out of that week, of all weeks, is plain unacceptable. Period. 

trueblueintexas

December 4th, 2015 at 3:40 PM ^

Although enforcable in the corporate world because there are so many options available, in major college football there are only so many teams (@ 120). Automatically all of your conference teams would fall under no-compete. That's 12 - 14 teams. Anyone on your schedule in the next 3-4 years would also be included. That's an additional 12 - 16 teams. So you would drop the pool of available choices down to 90 - 96 teams. In places where conferences overlap, you would probably include those schools also, so that takes out an additional 1 - 5 teams. Now the pool would be 85 - 90. Throw in the fact that there is a big difference between a Toledo type school and a Michigan which both compete at the same level and the available pool for highly qualified candidates is suddenly 35 - 45 schools. That is too small of a pool to limit your options to. It also means, you most likely would have to move a significant distance away anytime you wanted a new job. 

bcnihao

December 4th, 2015 at 10:50 PM ^

3-4 years is probably too long a duration to be enforceable.  As someone else noted, noncompete provisions that extend for more than a year tend to be suspect.

But as for geography:  given how assistants tend to travel to get jobs, I'm not convinced that geographical distance is as big of a restriction in this field as it would be for more "mundane" sorts of occupations.

Bryan

December 4th, 2015 at 3:39 PM ^

What if it was limited in a way to recruiting? Could a contract prevent a coach from making contact with any recruits that had a preexisting established relationships with team x when the coach take a new position with team y? 

It would be for the current recruiting cycle and limited an established relationship with the prior school. It would be quite narrow and a specialized. I doubt anyone would ever agree to sign such a contract with this type of clause, but it is something that is worth thinking about. 

sadeto

December 4th, 2015 at 3:56 PM ^

Actually, some assistant coach contracts contain provisions that restrict lateral moves but not advancement in another program, sometimes within conference, with a buyout attached. This is the case with the lawsuit by Oklahoma State against Texas coach Joe Wickline. He is arguing that he is calling plays for Texas, which he didn't do at OSU, therefore he does not have to pay the buyout. But OSU is saying he took a lateral job. Texas wants nothing to do with the suit. 

People are talking about courts taking a hard look at non-competes, but that is generally in the case of non-competes that extend beyond severance compensation. e.g. you get 12 weeks severance but have a 52-week non-compete. I think California is the only state to outright ban them. Here in NY judges do look down on them if they feel a company is trying to restrict someone's ability to get a new job, but good luck fighting in court unless you have a lot of money to burn. 

 

VicTorious1

December 4th, 2015 at 4:17 PM ^

In certain states, noncompetes, at least in the employment context, are unenforceable.  All states in which noncompete agreements are enforceable require that the restrictions placed on an employee be reasonable in duration and scope (primarily geographic). Further, courts and state legislatures seek to balance an employer's legitimate need to protect its confidential information with an employee's need to earn a living. Most states, either in case law or state statutes, have articulated the principle that the restrictions on the employee should not be any greater than necessary to protect the employer's legitimate business interests. However, states vary on how they strike this balance depending on governing state law and facts
specific to each case. 
 
The easonableness of duration is generally deteremined based on the type of employment.  If the employer is trying to protect confidential information, then courts will look at the volatility and longevity of the information.  Certain states have presumptions regarding duration.  For example, under Florida law, a restraint of six or fewer months is presumptively reasonable, but a restraint that exceeds two years is presumptively unreasonable.  Courts are often more critical once the duration exceeds three years.
 
The reasonableness of geographic scope is genearally based on the activities of the employer.  Companies that only do business in one state will have a more difficult time convincing a court that a restriction is reasonable that prevents an employee from working in another state.  In Texas, for example, courts look at the activities of the employee and not the employer when considering whether a geographic restriction is valid.  UM would have a better argument in court if a noncompete was challenged by a coach going to Maryland than Oregon.
 

Michigan4Life

December 4th, 2015 at 4:18 PM ^

and is usually at 1-2 year contract.   I'd have to imagine the only restriction is the lateral move in the same conference. As for climbing up the ladder, there's no restriction because if there is, the assistant coaches would not sign the contract.

Mr Miggle

December 4th, 2015 at 4:40 PM ^

Otherwise, i agree. There was a lawsuit by OK State this year against an assistant who went to Texas. OK State claimed it was a lateral move with Texas giving hm a phony job title to avoid triggering his buyout.

Sometimes the buyouts for head coaches are higher for certain schools or waived for others. They might not just have rivals in mind. If a school signed Matt Rhule this year, they'd be wise to ask for a large buyout if he left early to go to Penn State.

Lampuki

December 4th, 2015 at 4:19 PM ^

Unenforceable in some states, quite enforceable in others, somewhat envorceable in some.  Almost always going to be litigated so that would be a mess for the prorams and the kids frankly.

 

Like someone said they are being looked at through a very narrow lens right now and some coaches do have easy OUT clauses (e.g. Miles allegedly could got to us) so I assume that goes both ways.  What a mess that would be though and not in the best interest of anyone to futz around with them.if these were common. I would prefer that NCAA pass a rule that if a coach breaks his contracdt he has to sit out a year.    

Like many have said no good coach would agree to one (but BERT apparently did perhaps after climbing off his wife still in sugar and ribs haze).

   

NRK

December 4th, 2015 at 4:26 PM ^

One of the slow trends is towards focusing on how the individual is using information of your former employer (trade secrets, confidential information, proprietary information) to compete, rather than just competing against the former employer. Not nearly all states are there, but it'll be there down the road. 

 

That concept doesn't translate that well to coaching, although I suppose you could say that "Harbaugh him me X system" and that system is confidential and therefore the coach shouldn't be able to use it to compete against him in 6-24 months or something like that.

 

That being said, I think a lot of coaches wouldn't sign an agreement that has that. And I think you'd end up negotiating it away if it ever sniffed litigation because you rarely win putting someone out of work, you just end up restricting something particular about their work (customers, clients, vendors, area, etc.)

BlueHills

December 4th, 2015 at 4:29 PM ^

As with all contracts, those with assistants are arrived at after negotiation with the institution. Assistants with higher profiles have more clout than assistants who have less of a resume or less experience.

Durkin was a highly sought after assistant coach, and when he came in Harbaugh knew it was going to last only as long as Durkin didn't have a head coaching offer he was interested in.

I guarantee that Harbaugh encouraged Durkin to go for the Maryland job. He came from a coaching family, and would have understood what that opportunity to coach in the Big Ten meant to Durkin and his family.

Incidentally, there are legal restrictions to non-compete clauses relating to time limitations, reasonableness, geographical limitations, etc. But ultimately it comes down to how badly a school wants a guy like Durkin, a guy who came in with a very high profile for an assistant coach.

morepete

December 4th, 2015 at 4:29 PM ^

Non-compete clauses are anti-capitalist. I love that they basically cannot exist in California. All they do is suppress wages and innovation. I wouldn't want the, for the same reason I don't favor any restrictions on transfers beyond the one-year for underclassmen. Let people seek opportunity. Leave it up to their employers to see if they can keep them happy.