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The Gareth Bale transfer: Good business practice?


Gareth Bale's move to Real Madrid over the summer understandably focused on the world record-breaking transfer fee. But Becky Boston examines the trickle-down effect on Bale's previous clubs and whether a similar system could work in business.

The recent press relating to the transfer of Gareth Bale has brought to our attention the importance of contractual clauses. Much has been made of the fact that Southampton Football Club lost out on a potential £10m payment from the transfer of Gareth Bale due to Spurs buying out Bale’s sell-on clause in their hour of need. However, Southampton did receive £2m as a solidarity payment.

The solidarity payment is in relation to the club developing home grown players between the age of 12 and 23. When the player moves to another team, the training club are entitled to up to 5% of the transfer fee in recognition of their training investment. Bale was on Southampton’s books between the ages of 12 and 17. 

So if you transferred the idea of a solidarity payment to business, would more companies be willing to invest in trainees and apprenticeships? We often hear senior managers complaining that they put in a lot of time and energy into growing and developing trainees only to have them leave upon qualification for a more lucrative position, thus losing out completely.

In football the amount of the transfer fee and the solidarity payment (as it is a percentage of the transfer fee) is directly related to the performance of the player. Therefore, a greater training investment should develop better players which in turn would result in a larger solidarity payment.

"If companies committed to reinvesting any solidarity payments back into training it would create a more effective pipeline for our future workforce."

So if you were a business which invested heavily in training, produced the best trainees and therefore became the 'go-to' company when your employees qualified, could you instigate a solidarity payment or investment payment rather than the employee paying the usual claw-back?

With a claw-back, if the trainee leaves employment during or after qualification the company claims a percentage of the investment costs back from the employee. We could revise this and add another option: if the employee chooses to leave they can either pay the claw-back or their new employer can pay a solidarity payment, then the trainee is more motivated to undergo training and be developed because they may not have to absorb the complete costs of doing so.

Ideally you would prefer your best employees to stay with your company for as long as possible so you receive the benefit of their training and development, but that can’t always be achieved. However if companies committed to reinvesting any solidarity payments back into training it would create a more effective pipeline for our future workforce.

One in four 21 year old graduates are currently unemployed. According to the latest figures from the Office of National Statistics, those who do manage to find work can find their degree is irrelevant, often working as waiters, bar tenders or administrators. Despite increasing unemployment and limited job opportunities for graduates, going to university appears to be the default option for many British teenagers even with the recent increase in fees. 

Now, more than ever, is the time for businesses to invest in young workers whilst being confident they will be able to reap the rewards of their investment. The trainees and apprentices then gain the experience of working in industry, earning a wage as well as studying in an area which will support and grow the business.  

Not only will this provide fantastic opportunities for school or college leavers but will help tackle the ever-increasing problem of business trying to recruit specialist skills.    

Footballing academies identify talent early and spend a significant amount of time and energy to get the best out of their players. Commitment, skill and effort is recognised and richly rewarded. If we look at Southampton Football Academy where Gareth Bale started his football career, they have produced Callum Chambers, Lloyd Isgrove, Harrison Reed, Omar Rowe, Jake Sinclar, Luke Shaw and James Ward-Prowse. All of these players are 20 years old or under. They are all graduates of the Southampton Academy. They’ve all played first team football this season.

If businesses applied the same focus on the next generation of workers as footballing academies such as Southampton, secure in the knowledge their investment is protected and reinvested, could we solve some of the skills shortages and youth unemployment in today’s Britain?

Becky Boston is co-founder of Emphasis Ltd. Emphasis was formed in 2003 by Jane Michel and Becky Boston with a vision to help businesses put the fun back into employing people. Knowledge sharing is actively encouraged within the team pulling on experiences gained from working in a range wide of industries and business sectors. The team work collaboratively both internally and with their clients to achieve the best solution.For more information visit about Emphasis click here or follow them on Twitter

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