Following his playing days, Henley became the athletic director and coach at Mount Allison University in New Brunswick, and Brock University in Ontario. From 1989 to 1993, Henley was hired as defence coach with the Hamilton Tiger-Cats. As coach, he made another appearance in the Grey Cup in 1989, losing to Saskatchewan in the final minutes. He also served as the Director of Football Operations for the Ottawa Rough Riders from 1995–1996. His teams had a combined 6–30 record. In 1996, Henley moved back to his home state of South Dakota after 36 years in Canada. He finished his career as an athletic director at his alma mater, Huron University. After Huron University closed, Henley became General Manager for Professional Transportation Inc., transporting railroad engineers and conductors. He retired in 2013.