AFL coaches are on the verge of an historic new agreement with the competition that will see the league underwrite better working conditions for coaches to recognise that the game's key leaders have been neglected in the past.

In a move that was approved in principle by the AFL Commission earlier this month, the 16 coaches should be subject to a collective bargaining agreement signed by the clubs and the league to grant them minimum annual leave, one day off each week during the football season and regular time-off from the rigours of day-to-day coaching to develop their skills.

The 16 club chief executives are understood to have approved in principle handing control of improved terms and conditions for their coaches to the AFL.

The tripartite agreement could be signed within the next 12 months following the mutual concession by AFL Coaches' Association chief executive Neale Daniher and AFL boss Andrew Demetriou that the two parties have not worked together harmoniously in the past.

"Andrew agrees that this is truly the last frontier for the AFL in terms of its working relationships," Daniher said. "The commission has agreed that the relationship needs to improve on several levels."

Said Demetriou: "As an industry, the coaches haven't had the recognition that other areas of the game, such as players, have received in the past. They deserve to have some consistent terms and conditions without us interfering in areas such as financial remuneration.

"The coaches are very important leaders of our game and we need to work more closely with them and use them to promote and grow the game."

The AFL's football operations boss Adrian Anderson has worked with Daniher and Demetriou on the agreement that could see the commission approve funding for coaches' development, education and post-coaching career strategies.

The association, once the subject of derision from the AFL, will also seek government and corporate funding — it is already into the second year of a sponsorship agreement with Channel Nine. The AFL is also funding the association's soon-to-be completed business plan.

In return, the coaches will work more closely with the AFL to promote both the competition and communicate responsible social behaviour to the community as part of the agreement.

"The players play an important role in the community," Daniher said. "But the coaches perhaps would be more appropriate to perhaps talk about the dangers of binge drinking than players.

"We love the game. We want to grow the game and we need to improve our dialogue with the AFL and sell ourselves better.

"This agreement will never take over the contracts with the clubs, but we are hoping to see a better life balance for coaches and less coaches leave the game burnt out and not qualified for anything else.

"And we want to improve our coaches. The commission has strongly backed that. Even at community level if you get a dickhead coach it affects the whole club."

Former senior coach Peter Schwab, now the chief executive of Football Victoria, has met regularly with Daniher to discuss the new agreement.

"Too often coaches, particularly assistant coaches, are left out in the cold when there's a changeover of senior coaches," Schwab said.

"You build up a skill set but what does it build you a skill set for? Coaching."

Long-time assistant coach Peter Curran, now overseeing the football program at Wesley College, lost his job at Melbourne last season when Dean Bailey was appointed.

Curran, a dual Hawthorn premiership player, said he turned down two AFL club assistant roles in a bid to seek job security.

"The exit strategies for senior coaches are under-developed," Curran said.

"I had a decision to make. I had teaching to fall back on but not all coaches have teaching and not all of them make it in the media.

"If I stayed in the system I might have been in the same boat in two years. It's a ruthless business and I'm certain there is a real need to ensure there's a better pathway in and pathway out."

Kevin Sheedy — a founding champion of the coaches' body — is now chairman of the association with Neil Craig, Paul Roos, Mark Williams, Mark Thompson and Alastair Clarkson making up the senior executive. Chris Fagan (Hawthorn) and Guy McKenna (Collingwood) represent the assistant coaches on the executive.

Daniher said the bad blood that has existed between the majority of the senior coaches and the AFL in recent years was becoming less of an issue.

"There is genuine goodwill now between the two parties," Daniher said.

"I'm not saying it's fixed or that we've got it right but the good will is there and that's a start."