Types of Agreements and General Considerations of Coaching Contracts

Aug 15, 2008

By Donna A. Lopiano, President, Sports Management Resources
NOTE: This is part one of a story written by Donna A. Lopiano, President, Sports Management Resources, which looks at coaching contracts. It is important to preface any discussion of coaches’ contracts with a reminder that careful review by school district or university legal counsel of all employment policies and documents is essential. The purpose of this article is to provide an understanding of the most common elements of coaches’ agreements.
Types of Agreements
‘Employees At Will’. Over 2,000 colleges and universities and over 25,000 high schools employ coaches for their athletics programs. At the high school level, coaches’ salary schedules are most often addendums to full-time teacher/administrator salary schedules that list compensation for “extra duties” (i.e., band advisor, athletic team coach, etc.) with provisions that similar stipends be paid to part-time personnel hired to coach. These stipends differ by geographical location and wealth of community, and typically range from $1,000 to $10,000 per sport head coaching responsibility with lower sums for assistant coaches. These schedules are often subject to collective bargaining as part of teachers’ union agreements. Typically, high school coaches and teachers get a letter of appointment each year issued by the school district for the upcoming year or containing no mention of the duration of the appointment. The appointment with unspecified term simply continues until the school or the coach decides to make a change. The appointment letter specifies what the coach is being hired to do. Unless otherwise covered by a collective bargaining agreement, these coaches are ‘employees at will’ which means that the school can terminate the employee at any time and the employee can leave at any time. In these situations, the high school athletics director does not have to deal with coaches contracts. Coaching duties are simply part of the assignment made via letters of appointment issued by the school district.
The vast majority of colleges and universities operate similarly. Coaches are employees at will with appointment letters issued by the office of the president, chancellor or provost. However, at the college level, coaches are more likely to have full-time or part-time coaching responsibilities with no or few teaching assignments. Also, at the collegiate level, coaches’ salaries vary greatly and may be negotiated rather than part of a public schedule or teachers/faculty collective bargaining agreement. However, these practices vary from state to state with regard to public institutions and the variability is even more evident at private institutions of higher education.
Standard letters of appointment usually consist of one page with few details regarding the specific responsibilities of the position. They often contain references to official job descriptions which are normally detailed in athletics department policy manuals. It is very important that these athletics department policy manual provisions regarding coaches’ specific responsibilities and expectations for conduct and continued employment be reviewed and approved by school district or university legal counsel because they reflect contractual obligations.
Multi-year Coaching Agreements. Individually negotiated multi-year coaching agreements are generally accepted at institutions that hire full-time coaches for a single sport, have a high expectation with regard to competitive success, and/or expect the sport to produce significant revenues. These agreements are the opposite of ‘employee at will’ appointments in that they have a specified duration, limited conditions under which employment may be terminated and other terms that elevate the financial and other obligations of the institution and the employee. Such contracts are commonplace within the NCAA’s Division I member institutions but also occur in selected sports at institutions in other competitive divisions and, more infrequently, at the high school level. For example, it is not unusual for a high school football coach in some states to be paid more than teachers and have a multi-year employment agreement, courtesy car and other perquisites more commonly found among college coaches. Even a small Division II or III athletics program may have a continuing expectation to be dominant in a sport unique to the history of a school with a coach who receives higher compensation and greater contractual assurances than coaches of other sports in the program.
Thus, for athletics directors who must negotiate such agreements, it is important to understand institutional expectations for the sports program and be versed in the history of existing coaching agreements within the institution. Consultation with legal counsel or human resources administrators are required to determine and get approval for employment policies, issue employment agreements and authorize the types and limits of permissible compensation. The following information is useful for athletics administrators whose responsibilities include negotiating employment agreements with coaches.
General Considerations
Consistency With Policy Documents. Often, institutions have some coaches who have multi-year agreements and others who are employees at will. The athletics director must always be sure that coaches contracts and policy manual provisions are consistent or that differences are clearly acknowledged as being applicable to specific types of employees. Thus, employment policies and individual employment agreements should be carefully reviewed and approved by legal counsel or other administrative authorities before being issued.
Marketplace v. Educational Sport. The elements of coaches’ employment agreements and/or athletics department employment policies must be considered from both a philosophical and marketplace perspective. It is not unusual for the marketplace that includes some high-powered high school programs or NCAA Division I football and basketball coaches to offer benefits and incentives that are inconsistent with educational philosophy, especially in situations where the athletics director, principal, superintendent and/or college president believes their positions are in jeopardy if the community or alumni are not provided with winning teams. How can an educator justify a coach earning thirty times more than an average full professor or three times more than the university president, especially in a tainted marketplace where wages to athletes are prohibited and most athletics programs operate at a net loss? While the athletics director may find many of the following key elements or benefits distasteful from an educational sports perspective, the fact remains that right or wrong, they represent the reality of a difficult to explain marketplace in which failure to provide such elements may very well signal the end of an athletics director or college president’s employment. Coaches agreements should never be negotiated in a vacuum. The athletics director must consult with colleagues at like institutions, preferably peer conference or other level competitors, to get a clear understanding of the ‘going rate’ for each contract element. These institutions comprise the marketplace in which the institution must compete for the employment of coaches.
Agents and Attorneys. The athletics director may need to deal with a coach’s lawyer or agent in contract negotiations. In general, as the compensation, complexity and sophistication of employment agreements increase and the negotiating process involves legal and business experts as representatives of the coach, so should the involvement of an institution’s legal counsel, human resources administrators and other senior administrative officials. Athletics directors should focus on substantive deal points – a plain language list of agreed upon compensation, benefits and responsibilities – and leave the actual drafting of the contract up to the institution’s attorney.
There is an advantage to initially meeting with the coach and his or her agents without the institution’s attorney being present. It deescalates the weight of such proceedings, allows the coach and athletics director to talk in plain language without attention to legal subtleties and allows the initial meeting to focus on the coaches’ and athletics director’s needs and expectations rather than reaching an immediate agreement. The athletics director can explain that the purpose of an initial meeting is to put all needs and expectations on the table so the athletics director can follow up with conversations with higher administrators to determine the elements and limits of compensations and benefits he or she is authorized to include any agreement. If the coach refuses to participate in such a meeting, indicating that he or she prefers an authorized representative to work with the athletics director instead, meeting with the agent does not change this approach to the initial meeting. Subsequent meetings will represent actual negotiations that examine the acceptability or possible revision of deal points in an attempt to come up with a final agreement that balances individual coach and institutional interests. Once the deal points are finalized, the relegation of those points to legal language can become a matter handled between the coach’s and institution’s attorneys.


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