Esports and Employment law. The next big revolution in the gaming world? Probably not. But an interesting and often overlooked sub-genre of law, most definitely.
Esports are, in brief, the big leagues of competitive video games. Like traditional sports, esports will vary from game to game, you can have fast paced shooters like Call of Duty, games of strategy like Star Craft and Sports games like FC 25. There is a great deal of variety.
Organisations (Orgs) will take place in high profile competitions for significant sums of money. Matches are streamed all around the world and the industry has grown significantly over years. Many of the competitors are young. They will join Orgs with the incentive of winning millions. Significantly more than they may expect to earn doing more traditional jobs. The issue of course, is many of the aspiring esports stars are unaware of the terms they are agreeing to when they join an Org. They may dedicate hundreds of hours to preparing for a competition, only to be cut from the team at the last moment without any remuneration.
In the European Parliament’s resolution on esports and video games dated 10 November 2022, it was noted that esports players can suffer from high stress levels due to a lack of work life separation. This would be compounded by the potential loss they may experience where they have been cut from a team or failed to comply with an otherwise overly onerous contract. There is also the issue of the online world. It is not uncommon for disputes to become very personal and vitriolic, something that can be dealt with in a traditional workplace, but less easily in the context of unregulated esports teams.
How does this link to employment law?
In short, the contracts that prospective esports players, including exciting sponsorship deals, may actually fall into the employment/worker status territory.
How is employment status determined?
Section 230(1) of the Employment Rights Act 1996 (ERA 1996) defines an employee as “an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment,” with section 230(2) further clarifying a contract of employment as “a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing.”. This status extends to individuals who work under “any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract, whose status is not that of a client or customer of any profession or business undertaking carried on by the individual.”
As such, while many professional gamers may operate under the assumption that they are self-employed, in reality, the nature of their arrangements more often aligns with either employee or worker status—bringing with it a range of rights and legal protections they may not realise they’re entitled to.
The three indicators that a player is in fact an employee of the Org is whether they;
- Have control over the player during their working hours,
- There is a mutuality of obligations; and
- The player provides a personal service.
Issues with contracts
The case of Turney Tenny vs. FaZe Clan Inc (US) brought to light a crucial reality within the industry: esports players are, in many respects, employees and the contracts they sign should reflect that status. While this case holds no direct influence over UK law, it serves as an important reference point for what esports professionals should consider and be aware of when entering into contractual agreements.
Teams and sponsors often attempt to limit a player’s opportunities to work with competing brands through the use of heavy-handed restrictive covenants. In practice, many players may not fully grasp the consequences of these clauses and could mistakenly believe they are bound by them. However, restrictive covenants must strike a fair balance, they should protect a legitimate business interest without being unduly burdensome. If they go too far, courts are likely to disregard them entirely rather than attempt to revise them.
Risk
Esports organisations frequently recruit players on short-term contracts to represent them in specific tournaments, often under the assumption that these individuals are not employees. However, if these contracts are not carefully drafted, organisations risk exposure to a range of legal claims, including, with reference to the incoming Employment Rights Bill, unfair dismissal, constructive dismissal, discrimination, and whistleblowing, as well as potential tax liabilities.
With the upcoming changes under the Employment Rights Bill 2026, employees will be entitled to protection against unfair dismissal from day one of their employment, increasing the importance of getting these contractual arrangements right.
How Moore Barlow can help
Our experienced employment law solicitors for companies provide comprehensive legal services to businesses, including advice on contracts, policies, disputes, and more. Speak to Cathal McCabe and Gary Hunter for more information and advice on Esports and Employment law. Happy Gaming!
