Everton have been told they must pay Burnley £35m in compensation after a Premier League independent disciplinary commission ruled that their breach of financial rules caused Burnley’s relegation from the top flight in 2022.
The verdict, the largest financial penalty ever imposed on a Premier League club, marks a landmark case that could trigger a wave of similar legal actions. The commission — the same three-man panel that deducted Everton 10 points over the same £19.5m breach in November 2023 — found that “on the balance of probabilities, Everton’s breach of the PSR caused Burnley to be relegated”.
“Everton ordered to pay Burnley £35m after commission rules PSR breach caused their 2022 relegation.”
Burnley had argued that had Everton been punished in the 2021-22 season rather than in 2023, they would have stayed up. Everton finished 16th that season on 39 points, with Leeds in 17th on 38 points and Burnley 18th on 35 points. The commission said it found Burnley’s evidence, which projected a gain of between 3.85 and 7.13 points for Everton, “more compelling” than that of Everton.
The £35m comprises £26m in damages and a further £9m in interest. Leeds United are reported to have agreed a settlement with Everton in September 2025. Leicester City, Nottingham Forest and Southampton were also reported to have considered legal action.
Everton have appealed, with sources saying they will “robustly and thoroughly” contest the ruling. In a statement, the club said they were “surprised and angered” by a decision they believe “is fundamentally flawed in both law and fact”. They added: “This ruling sets a dangerous and unworkable precedent for English football, given it is constructed on a principle that a club can be in breach of financial rules at any point in a financial year.”
The club, now owned by The Friedkin Group (TFG) after Farhad Moshiri sold in December 2024 for only £25m, insisted the ruling does not affect its summer transfer plans or its “robust financial position”. Any compensation payment would not impact Everton’s PSR accounts for the current period. It is not known whether TFG will pursue Moshiri for the damages due to Burnley.
The case centred on the argument that had Everton’s points deduction — originally 10 points, reduced to six on appeal — been applied in 2021-22, Burnley would have had a greater chance of avoiding relegation. Because of the complexities of the accounting period running to the end of June, the Premier League is unable to apply points deductions in the season the offence happens, but its rules allow clubs to seek compensation from other members if rules are broken and cause them loss.
West Ham United paid Sheffield United a compensation sum in a previous case. The Guardian noted the commission’s ruling increases the likelihood of more clubs taking legal action against members who have broken league rules.