Chelsea are once again facing the prospect of another costly managerial pay-off as Mauricio Pochettino took another step toward an early exit. The Blues manager is under more pressure than ever in his debut season at the club after another disappointing performance against Brentford on Saturday.
The 52-year-old, who celebrated his birthday on the day of the 2-2 draw in west London, was once again unable to spark a memorable performance. It caused supporters in the away end to chant against him and the owners, as well as for Jose Mourinho.
However, after parting ways with two permanent managers since taking over the club in May 2022, Todd Boehly and Clearlake Capital are unlikely to make an easy decision. Not only does the club want to evaluate their newest head coach at the end of the season after signing an initial two-year contract, but the process of parting ways with managers is having a greater impact than ever before.
Chelsea has previously spent more than £100 million on settlement payments with managers throughout the course of recruiting and firing, and that money is now the focus of increased attention. With a strong emphasis on transfer spending under the current American administration, Thomas Tuchel and Graham Potter have reaped significant benefits.
After signing a six-year contract in September 2022 and paying £20 million in fees to leave Brighton with his coaching staff, the Englishman was sacked seven months later, resulting in significant financial consequences.
With European football poised to leave the club for the second year in a row and all eyes on the new profitability and sustainability standards (PSRs), the club’s decision to part ways with Pochettino is far from certain. Dr Dan Plumley, a football finance expert, told Grosvenor Sport that the possibility of financial penalties from organisations could completely disrupt the way the management market operates.
“We don’t talk about that, but it does impact the bottom line,” he added. “That is the nature of things. If you have to pay a manager out of a contract, it’s the same as letting a player leave, and whether you win or lose depends on how the deal was structured through amortisation.
“Paying off a management has an impact on the company’s total profit or loss. As a result, it will count toward PSR, which is why clubs are plainly aware of it. Looking ahead, UEFA’s new version of the financial stability laws includes managers in the squad cost, which has not been included in what is now PSR in the Premier League or UEFA’s.
“If the Premier League wants to pivot towards UEFA, we’ll have to start talking about it more since it’s already in the UEFA framework. I believe there are two perspectives on this. The answer is yes, it is a factor. And second, what would it look like in the future if the Premier League alters their version of PSR to align with UEFA’s framework?”
Chelsea are already towing a delicate line on the surface, having spent heavily for little tangible return. Although they were not found to have exceeded the allowable £105 million barrier over a rolling three-year period, the true test remains following ongoing activity on an enormous scale.
Following Everton’s points punishment earlier this season, and the potential of more to come for Nottingham Forest, there has been a palpable squeeze from English clubs. Under pressure from the government to tighten financial controls across the football pyramid, the Premier League may amend its laws once more.
Plumley believes that the switch to UEFA’s percentage-based system is almost certain. “I can’t see it going any other way in the long run; it just makes sense to align them, like the Premier League did in the original iteration. All they did was increase the permissible loss because promoted clubs require some leeway to flex if necessary.
“They were almost a carbon copy in many ways, and I believe it stands to reason that if UEFA has this directive across European football for their competitions, and we now have a Europa Conference League, there will be more teams competing in UEFA competitions than ever before.
“I just can’t see any other way than the Premier League at least trying to mirror it as best as possible.”
For Chelsea, it certainly remains a key part of their forward planning. After Pochettino previously dug his heels in at Paris Saint-Germain in 2022 having been told of the call to sack him, it is one that the owners can do little but take into account when now looking towards how structure of the club from head coach upwards might look.
