Legal and commercial considerations of Cristiano Ronaldo’s shock Manchester United exit

On 23 November 2022, Manchester United FC announced that Cristiano Ronaldo was to leave the club by mutual agreement with immediate effect, saving the club roughly £15.5 million in wages.

The news comes following a dramatic 8-month period beginning in April 2022 with the announced appointment of new manager Erik Ten Hag. A few short months following the new manager’s appointment, Ronaldo sent the club a transfer request in the hope of playing for a new club in the Champions League. What has become a bit of a drama for the club has now ultimately concluded following the former United star’s appearance on Piers Morgan’s ‘Uncensored show’, in which Ronaldo revealed that he did not respect his manager because he believed respect had not been shown to him.

Tension between the player and the club have been reported throughout this season as a result of the player’s lack of playing time, which has seen him net 2 goals and 1 assist in 16 appearances for the club, in contrast to the 24 goals and 3 assists he achieved in 39 appearances last season. The suspected rift between both parties was on full show recently when Ronaldo refused to come on as a substitute nearing the end of United’s 2-0 win over Tottenham Hotspur.

Legal considerations

Professional footballer contracts typically contain provisions which permit termination for gross misconduct or material and/or repeated breaches of the contract. In relation to the latter, there is often a ‘catch-all’ clause directed at any other similar or equivalently serious or persistent conduct or omission by a player which the football club’s board reasonably considers to amount to gross misconduct.

Football clubs will also protect themselves specifically against players carrying out unauthorised interviews by including clauses in the player’s contract which if breached, would amount to material breach and would allow termination of the contract. For example, the standard FA player contract contains clauses which:

1. forbid the player from knowingly or recklessly writing or saying anything which is likely to bring the club into disrepute or cause damage to the club or its officers; and
2. require the player to give the club reasonable notice of their intention to make any contribution to public media in order to allow corresponding representations to be made by the club if it so desires.

Furthermore, to protect themselves in circumstances where a footballer refuses to play in a game out of protest, football clubs will typically insert a clause in the player’s contract holding the player to be in material breach if they refuse to play when selected by the manager.

With the above considerations in mind, one can better understand that the agreement not to pay Ronaldo the remaining £15.5 million left on his contract likely came from the fact Manchester United were in a decent position to argue the player’s conduct warranted a material breach of contract, rather than a mere warning and/or fine. It can be surmised that three legal avenues of material breach which the club could have pursued are:

1. the interview Ronaldo gave to Piers Morgan was unauthorised by the club and was likely done without prior notice to the club;
2. the comments made by Ronaldo during the interview openly criticised and brought into disrepute the club’s officers and employees (including the manager). For example, the player stated: there was “no evolution in the club”, “the progress [he had seen at the club] was zero”, he felt “betrayed” by the club and there were “some things inside [the club] that don’t help [us] reach the top level as City, Liverpool and even now Arsenal…”.
3. as mentioned above, Ronaldo refused to come on as a substitute at Erik ten Hag’s request against Tottenham Hotspur. Similarly, Manchester United may also rely on the fact that Ronaldo (together with a few other United players) left the club’s 1-1 pre-season draw with Rayo Vallecano before the game ended.

Notwithstanding the likely good contractual grounds to terminate, commercial considerations will obviously have been taken into account in the club’s decision to terminate via mutual agreement.

Commercial considerations

From an on-pitch perspective, one can speculate that Manchester United may have decided that the team dynamic would be better-served without a player who openly criticised the club and chose to ignore the manager’s instructions to play his part at the end of a game. Furthermore, Ronaldo’s declining goal scoring output and starting appearances this season, may also indicate that the player was surplus to Erik Ten Hag’s requirements.  Ten Hag’s renowned ‘team-first’ approach will have played a big part in the decision no doubt.

Off pitch, the club may have considered Ronaldo’s apparent £500,000 a week wages to be too expensive to maintain, taking into account the above considerations. The club may have seen the £15.5 million they save in wages as a worthwhile settlement for letting the player leave the club by consent. Furthermore, mutual termination would also serve as a ‘clean break’ for the club. They would not have to deal with the potential employment law dispute (and PR nightmare) which could have ensued if the club choose to end its relationship with a club legend and footballing icon following an alleged breach of contract.

This decision would have undoubtedly been taken with full consideration of the commercial losses the club would suffer following the departure of Ronaldo. He is probably the best-known football player in the world (he has 502 million Instagram followers for example) and attracts a great deal of attention whatever he does. This has obvious adverse impact on reduced replica shirt sale, products revenue, social media followers and correspondingly potential fewer sponsorship opportunities).

From Ronaldo’s perspective, one can speculate that he has strategically used this situation as an opportunity to leave Manchester United and join a different club, such as Bayern Munich, Paris Saint Germain or his boyhood club Sporting Lisbon. We know that Ronaldo wants to play in the Champions League (no doubt with half an eye on his record number of goals in that competition coming under threat from Lionel Messi at Paris Saint Germain).The fact that potential suitor clubs will not have to pay a hefty transfer fee would strengthen Ronaldo’s position not only to find a club playing in the Champions League but also to negotiate higher wages.

Final comments

Although the past week’s events between Manchester United and Cristiano Ronaldo may have seemed surprising, especially given the club and player have previously weathered different PR storms (the drama that came following the wink Ronaldo gave the Portuguese bench after he got his then team mate, Wayne Rooney, sent off at the World Cup in 2006 comes to mind), termination via mutual consent was most likely the most amicable way of settling the dispute (especially as a working relationship between both parties appeared no longer possible).

Those who are fans of seeing the Portuguese superstar in the Premier League should not yet despair at the potential departure of Ronaldo: The Times have reported that Manchester United have opted not to include a clause in their settlement forbidding the star from joining another English club. With reports mounting that the chairman of Chelsea, Todd Boehly, is preparing to follow on from his summer interest and sign the player, it may not be too long until we see the Portuguese star plying his trade for another Premier League giant.

As the Glazer family have confirmed that Manchester United is up for sale or at least open to additional third party investment, some may argue that Ronaldo’s surprise exit could be a ‘parting gift’ which would draw in a new era for the club under a new owner.

If you have any questions regarding this topic, please contact Simon Miles and Jamal Saleh or any members of the Intellectual Property or Corporate teams.

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