Behind the Bielema Jump

Behind the Bielema Jump

Originally published in the Milwaukee Journal Sentinel, Opinion, December 19, 2012.

Opinion: Behind the Bielema Jump, Milwaukee Journal Sentinel (December 19, 2012)

Badger Nation, its administrators, players and fans, were shocked by the sudden resignation of Bret Bielema as head football coach of the University of Wisconsin.

Bielema was hand-picked by his predecessor Barry Alvarez and compiled a 68-24 record (.739) in seven seasons, including three Big Ten titles. Bielema guided the Badgers to a bowl game in every season during his coaching tenure, and the team will be playing in the Rose Bowl for the third consecutive year after a lopsided 70-31 victory over Nebraska in the Big Ten Championship game.

Speculation about why Bielema left Wisconsin for the University of Arkansas includes a more lucrative contract, a stronger conference, more money to hire assistants and a chance to win. As Al McGuire always would say, “Leave at the top of your game.”

Bielema’s decision is representative of a business where turnover is commonplace, where long-term loyalty is not required and where the term of the contract is meaningless.

Bielema’s Wisconsin contract is a personal service contract. As such, if a coach wants to jump, he cannot be forced to work, and the remedy of specific performance is not available to the university. Damages are speculative and hard to calculate. The only legal tool that a university has to keep its coaches off the playing field is a negative injunction – a court order preventing the coach from coaching at another institution. As a result, and to circumvent all this legalese, early termination for both the coach and the university is a two-way street.

In the coaching business, the university at any time and for no reason can cut short the term of its coach by terminating the coach without cause. Termination by the university without cause usually involves a failure by the coach to win, lagging ticket sales, dwindling attendance, unhappiness among big money donors, loss of interest in the program, inability to compete in a conference or against a rivalry opponent or changes in administration.

Early termination by the university, of course, will require some payment in damages. The measure of damages is normally the contract package for the remaining term or an agreed upon or bargained lump sum. The University of Tennessee is now on the hook for its firing of Derek Dooley to the tune of $5 million, and Auburn University’s firing of Gene Chizik, even though he won a national championship two years ago, could cost as much as $7.5 million.

If Arkansas would fire Bielema without cause in 2016, for instance, the school would owe him as much as $9.6 million. Termination without cause by the university normally would require the coach to mitigate damages by obtaining comparable employment through a good-faith effort to find another job to offset losses.

On the other hand, the coach has the opportunity to cut short his contractual commitment to the university by providing written notice of termination and paying an exit fee. For instance, Michigan State head coach Mark Dantonio’s exit fee is $2.5 million, while Urban Meyer of Ohio State would have to pay $2 million.

Bielema’s exit fee for leaving Wisconsin early, pursuant to the letter agreement with Arkansas, will be paid by Arkansas. Bielema’s exit fee is $3 million, which decreases by $500,000 for each subsequent contract year.

While movement in college coaching should not be shocking, the fact that Bielema reportedly did not inform Alvarez, the athletic director, until after the acceptance of the letter agreement is alarming. One would have thought that Bielema would have told his mentor that he was seeking employment with another university, even though he may not have been legally required to do so.

Most coaches’ contracts have clauses that prohibit the coach from accepting or seeking employment as a coach for another NCAA Division 1 football team or professional team during the term of the agreement without first obtaining the university’s prior consent. Some contracts even prohibit those discussions not only during the season, but until after the completion of bowl competition in order not to do injustice to the university and its players.

College coaching is a big business, and contracts are as easily broken as made. Long-term contracts in college coaching don’t mean a thing. Jumping at the next best opportunity is the name of the game. And understanding that job environment is the key to understanding jumping contracts.

Martin Greenberg is a Milwaukee attorney who has represented coaches in contract negotiations and has written extensively on the subject. See here