Manchester United set to offer Erik ten Hag substantial payout following dismissal: report

Manchester United will need to compensate Erik ten Hag with a substantial severance package following the club's decision to part ways with the Dutch manager on Monday.

Ten Hag leaves the club 14th in the Premier League and without a win in three Europa League games, which ultimately led to his demise at Old Trafford. But, after extending his contract to June 2026 after he won the FA Cup last summer, Manchester United will now have to pay him off a considerable fee.

Ruud van Nistelrooy will take charge of the club on a temporary basis, with a number of high-profile, costly, individuals linked with the vacancy. PSR considerations could limit the club's managerial search, however, with Ten Hag set to receive an eye-watering sum of money.

Manchester United owe Erik ten Hag £16m

According to The Athletic, Manchester United owe Ten Hag around £16m as part of the severance package that will see him leave the club early, with the Dutchman owed the money from the 20 remaining months of his contract.

While Jose Mourinho and his staff received £19.6m for being sacked in 2018, Ten Hag is the only person leaving Manchester United this time around - highlighting the considerable pay-off he is getting for being relieved of his duties.

In doing so, Manchester United are risking falling foul of the Premier League's PSRs. In the summer they spent around £180m on new signings, and while those fees will be spread across the players' respective contracts, transfers from previous years is also accounted for across a three-year period.

Hiring a new manager that is already in a job, therefore, could prove difficult. Ruben Amorim of Sporting Lisbon has emerged as an early front-runner to become the next Manchester United manager, but his reported £17m release clause is arguably too expensive at this moment in time.

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VIDEO: Why Man United's Biggest Problem Is... Erik ten Hag

That's why names such as Graham Potter, Gareth Southgate, Xavi Hernandez and even Ruud van Nistelrooy are all much more realistic when it comes to the next permanent boss.

Manchester United host Leicester City in midweek, but return to Premier League action against Chelsea at Old Trafford on Sunday.