As far as trade restrictions are concerned, they are generally circumstances in which an employee is subject to an express trade restriction provision in an employment contract.
The Saudi wallet is a seemingly bottomless pit, so Humpty Dumpty – the PGA – could be on the verge of a big tumble.
Golfers who are members of the PGA are not employees per se. They are members of an association and are subject to its statutes. Regarding the Australian PGA, the Player Handbook & Tournament Regulations states: “No PGA Tour Champions member may participate in any other golf event on any date when a tournament co-sponsored by PGA Tour Champions … is scheduled, except as follows : An event for which a member receives prior written approval for participation from the Commission…”
It goes on to say, “Each PGA Tour Champions member, by participating in a jointly sponsored, coordinated or sanctioned tournament, acknowledges the right and authority of the PGA Tour Champions Division Board to (i) fine the member and ban tournament play to be excluded … for violating these tournament rules.”
Trade restriction open to interpretation
To take the current confusion, although the rules mean a golfer could be banned from participating in PGA events, it would not prevent that golfer from participating in LIV events. So is it an illegal business ban if the golfer can still earn a living?
The answer is that it could be. It is not final, but provisions in a trading agreement or in the rules of sports statutes can – and have – been found to be an unlawful restriction on trade.
It is often believed that the rules of sports laws are very prone to being viewed as an unlawful restriction of trade. However, due to the co-dependency between code, clubs and participants, the boat is rarely shaken. In the AFL, for example, the poaching wars that broke out among the powerful clubs in the 1980s nearly bankrupted them and was a major reason for the creation of the AFL Commission.
In golf it’s a different scenario. The Saudi wallet is a seemingly bottomless pit, so Humpty Dumpty – the PGA – could be on the verge of a big tumble. And beyond what individual golfers can do, there’s the nuclear possibility of challenging PGA decisions as a violation of competition laws. That would be a feral cat among some very nervous pigeons.
Aside from trade restrictions, another consideration might be the legal review of any method of disciplining a golfer. Procedural fairness is required during disciplinary proceedings and the reasons for a disciplinary decision may be questioned. Just ask former Wallaby full-back Israel Folau and leading NSW horse trainer Gai Waterhouse.
In Folau’s case, his contract with rugby union was terminated after he expressed views about homosexuality that arose out of his strong religious beliefs. He alleged breach of the Fair Work Act’s discrimination provisions and that Rugby Australia’s decision constituted an unlawful restriction of trade. The case was settled out of court in what is believed to have been good compensation for Folau.
More than three decades ago, the Australian Jockey Club rejected Waterhouse’s application for a coaching license on the grounds that she was married to Robbie Waterhouse, who had been banned from a bookmaker’s license for his role in the fine cotton affair. After a lengthy court case, she received her coaching license and successfully argued that it was discrimination.
Those two cases suggest that Smith’s attorney may already be looking at the fine print. Still, when it comes to trade restrictions, the only certainty is that nothing is certain.
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