Varnish legal case threatens Olympic hopefuls’ funding

A groundbreaking legal case that begins next week could lead to more than 200 Olympic and Paralympic hopefuls losing their funding.

Former Olympic track cyclist Jess Varnish is attempting to sue British Cycling for discrimination in a court action that could have far-reaching effects for the country’s elite athletes.

The case rests on Varnish’s legal team proving in the employment status hearing with UK Sport that she had employee rights, rather than the distinct status given to nationally-funded athletes.

Should Varnish’s team succeed in Manchester, sources close to the case say that up to 20 per cent of funded athletes will have their grants cut. UK Sport supports around 1,100 potential Olympic and Paralympic athletes.

Varnish is claiming she suffered unfair dismissal, sexual discrimination, victimisation and detrimental treatment as a result of whistle-blowing while part of the Olympic programme.

If she is allowed to proceed with her compensation claim for lost income, UK Sport could be forced to restructure its funding programme, paying national insurance on behalf of athletes and pension contributions for the first time. It could also lead to athletes making backdated financial claims.

“The case could have serious consequences,” the source said. “Though what happens will depend on the HMRC’s response; if Jess Varnish was to win, it could force UK Sport to completely restructure its funding model.”

Olympic and Paralympic hopefuls are paid “athlete performance awards”, with the maximum annual grant set at £28,000. It is exempt of tax, with athletes not given employment rights.

Varnish was stripped of her funding when she was dropped from the national squad in April 2016 on the basis that her performance was not at the level expected.

The 28-year-old claims she was unfairly discriminated against.

If Varnish succeeds next week, sources anticipated it could lead to athletes paying 20 per cent tax on some form of centralised contract.

The hearing is due to take place from Dec 10-16. UK Sport and British Cycling declined to comment.