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The Rationales for and the History of the Transfer System

Why is there a transfer system? There are at least three rationales that have been conventionally advanced in its defence. First, clubs invest in the training of their players, especially young players. The transfer system offers them compensation for such investment and therefore induces them to commit resources to training the stars (and the flops) of the future. Second, transfer fees help to circulate money within the game, to promote competitive balance. In the absence of a transfer system more powerful clubs would simply poach talent from smaller clubs without having to provide compensation. Third, the transfer system promotes stability. Players are not individuals: they are identified and selected as part of a team. The loss of one player may disrupt the playing system which forms the long-term plan for the entire team, because an exactly comparable replacement will simply not exist. So, it is argued, the transfer system offers some degree of protection to a club that does not want to lose the key to its carefully planned collective system. This protects the integrity of the competition more generally.

All three explanations are delivered from the perspective of the club, the employer, and, arguably, from the perspective of the sport more generally. The immediate interests of players as employees are here set aside. Athletes in a sport which operates a transfer system are plainly allowed less freedom to choose their employer than are employees in a normal industry. And the transfer system is based on the transfer of money between clubs, as employers, which otherwise would have been available to swell the players’ salaries. The transfer system depresses wages, and an athlete’s career is short.

As Johan Cruyff is reported to have said, reflecting on the footballer’s need to maximize income while pursuing a career as a player that is typically unlikely to last much beyond his 30th birthday: ‘When my career ends, I cannot go to the baker and say I’m Johan Cruyff, give me some bread.’[1] In fact this is not true. Certainly in the Netherlands and probably in many other countries too, Johan Cruyff would, until his death in March 2016, have been showered with bread—and cake too—in most, if not all, bakeries, at least if the baker is old enough to remember the brilliant Dutch team at the 1974 World Cup and the imperious Ajax Amsterdam side that won the European Cup in 1971, 1972, and 1973. But most players, who do not share Cruyfl[1]s glittering genius, would not be so honoured. They would have to pay for their bread. For them a career as a footballer is short, and money that they do not earn because of the existence of a transfer system is money they are denied as they plan for life after their short spell working as a professional sportsman.

Money that in normal circumstances would be received by an employee in wages instead goes to clubs as a transfer fee. On the account presented by clubs and governing bodies the money is designed to support the training of future talent and to achieve a degree of redistribution among clubs, to address financial and sporting inequality. On a more sceptical reading, what is happening is the privileging of employer interests over those of employees. And this occurs in a way that certainly would not even be contemplated among bakers, bankers, supermarket workers, and University teachers.

In truth, the explanations that have been advanced to justify the transfer system are largely post hoc rationalizations. The system has its roots in the early years of the development of the sport when the relationship between employers and employees generally was far removed from that of today. The football authorities enforced a transfer system which protected the interest of owners at the expense of players, largely because they could: it was simply a reflection of the gross asymmetry of power between employers and employees.

As briefly introduced in Chapter 4, the transfer system dates back to the nineteenth century and the first wave of imposing order and organization on sport which, in the wake of the industrial revolution, occurred in the United Kingdom. Its emergence was connected to the rise of professional status and an associated concern to standardize regulation of the game.[3] The basic model of the transfer system rests on each player being registered with a football club, in addition to having a normal contract of employment with that club. He or, of more recent significance, she cannot play for another football club, even if that other club is willing to offer a better deal, unless in addition the registration is transferred from the first club to the new club. And the typical incentive provided to the first club to agree to transfer of the registration (and in effect if not in form the player) is payment of a fee to the first club. The point is that footballers are treated differently from ordinary employees in other sectors, whose status depends on contract negotiation and is not affected by collectively agreed and enforced arrangements of the type found in professional football. This has the perfectly straightforward consequence that players are in a relatively poor bargaining position when compared with employees in other sectors. They cannot pick and choose their employer by bringing a contract to an end in accordance with its terms and concluding a new one: they cannot even break a contract, suffer the consequences stipulated by applicable employment law, and conclude a new one. They must attend also to the demands and constraints of the transfer system. The organizational structure of the sport limits their freedom while ensuring a generous advantage, compared to normal industries, to the economic position of the first club as employer. Footballers are treated profoundly differently from ordinary employees.[4] [5]

Even today, although the rigidity of the transfer system has been relaxed over time, one hears an echo of these Victorian-era assumptions as players are commonly referred to as ‘servants’ of a club, a label that would never be attached to sausage- makers or car-makers or providers of financial services. In 2008, at a time when he was widely suspected to be eager to leave Manchester United and play for Real Madrid (a move which was eventually completed a year later) the star Portuguese player, Cristiano Ronaldo, attracted indignation and ridicule for comparing his position to that of a slave.5 This was doubtless a tasteless exaggeration: but the relationship between the player and the club is, as a consequence of the industry-wide grip exercised through the transfer system, an echo of hierarchical labour practices of the distant past which, in normal industries, have long been discarded, albeit sometimes only after a struggle. In similar vein it is common to hear footballer’s wages decried as excessive, even obscene, or, a slightly more subtle but still scornful variant, to suggest that restrictions such as the transfer system should be of no concern to individuals who are so well paid. At least until the economic crisis of 2008 it was rare to hear any such concern directed at highly-paid bankers or hedge fund managers and even today criticism is muted. There is a mean-spirited and elitist sense that working-class men should think themselves lucky to be able to afford to buy good bread.

  • [1] Quoted in D Winner, Brilliant Orange: The Neurotic Genius of Dutch Football (Bloomsbury2001) 19.
  • [2] Quoted in D Winner, Brilliant Orange: The Neurotic Genius of Dutch Football (Bloomsbury2001) 19.
  • [3] See eg D McArdle, From Boot Money to Bosman: Football, Society and the Law (Cavendish 2000);J Magee, ‘When is a Contract More than a Contract? Professional Football Contracts and the Pendulumof Power’ (2006) 4 ESLJ accessed29 November 2016.
  • [4] The matter does not concern football alone: see eg S Greenfield, ‘The Ties that Bind: ChartingContemporary Sporting Contractual Relations’ in S Greenfield and G Osborn (eds), Law and Sport inContemporary Society (Frank Cass 2000) ch 8.
  • [5] ‘I Am a Slave, Says Ronaldo as He Pushes for Madrid Move’ The Guardian (London, 11 July 2008) accessed29 November 2016.
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