The Adam Chapman contract saga

So what is happening with Adam Chapman's contract?

The normal situation is that a player's contract will expire on 30 June on any particular year, and then the player is a free agent to move without transfer fee or compensation.

Under 24 players

However, for players under 24 (at 30 June), there are rules to protect the club, to compensate for contributing to his training and development.

If the club makes a 'not less favourable' contract offer, and that is turned down, the club is entitled to compensation if the player moves elsewhere.  (Not less favourable being basically the best year from his previous contract excluding signing on fees).

So what happens after 30 June if the player turns down the contract offer?

1 - the club enters into a new full contract with the player.

2 - non-playing: The club continue to pay his basic wages under the existing contract, and are still entitled to a Compensation fee.  The player is treated as 'Unemployed', meaning he can sign for another club outside of the usual transfer windows.  The player is not subject to club discipline and regulations.  After the first day of the season, if the player has not moved elsewhere without good reason, the club can stop paying him, and still be entitled to compensation.

3 - playing: The club enter into a week-to-week arrangement, under the same terms as his existing contract, and subject to club rules and regulations. So long as he is still paid, the club is still entitled to compensation if he moves elsewhere. 

4 - stop paying him under (2) above, at which point the player is a free agent.

5 - stop paying him under (3) above, at which point the player is a free agent, but cannot sign for another club until the next transfer window.

What compensation is due?

This perhaps the hardest to work out.  The Football Compensation Committee take into account

1: any costs incurred by either of the two clubs in operating a Football Academy or Centre of Excellence, in particular the cost of providing for students:- living accommodation; training and playing facilities, staff, education; kit; medical; matches; and any other incidental costs

2: the following criteria:- status of the two clubs; age of the player; transfer / compensation fee paid by the transferring club; length of time player was at the club; terms of the new contracts offered by both clubs; playing record; and substantiated interest from other clubs.

So where are we at now?

The club offered an initial contract which was turned down, all part of normal negotiations.

The club offered an improved contract which has also been turned down.

The club have said they are at stalemate now, with the club unwilling to increase its offer, and Chapman not wanting to reduce his demands.  Because of the value of the Compensation due (OUFC paid a transfer fee to Sheffield United, and also incurred costs in training and development), he will not be released on a free. 

So Chapman will continue to be paid under his old contract, either playing (or not), until he either moves or signs a new contract.
[edit: club statement: "Adam has clearly stated in discussions that he remains fully committed to the club and wants the opportunity to earn the level of contract he feels he deserves.  Once his existing agreement expires at the end of this month we will discuss with Adam about entering into an agreement whereby he continues playing on his existing financial package as per Football League regulations."]
So it seems Chapman / the club will be taking option 3, playing on a week-to-week contract, hoping to prove he is worth what he says, or to attract another club to sign him instead.