Leaders in uniform trounced in competition, very upset (3,2)
I believe the answer is:
cut up
'very upset' is the definition.
(cut up means very distressed)
'leaders in uniform trounced in competition' is the wordplay.
'leaders in' says to take the initial letters.
'in' means one lot of letters goes inside another.
'competition' becomes 'cup' (eg the FA Cup).
The initial letters of 'uniform trounced' is 'ut'.
'ut' put within 'cup' is 'CUT-UP'.
(Other definitions for cut up that I've seen before include "Dissect" , "Destroy with scissors" , "Distressed - dissected" , "Badly hurt" , "Abrupt change; pace" .)