The 39-year-old was moved from his role as first team coach by long-time pal and current Director of Rugby Rob Andrew in recent weeks, with former Wallaby prop Andrew Blades effectively moving up from his role as forwards coach to share main coaching duties with Andrew in a bid to stave off the looming threat of relegation.
Bates was one of Newcastle's first signings as a player/coach when they became a professional entity, brought to the north-east along with Andrew to spearhead their transition from amateurism, and helping them to the Premiership title back in 1998, as well as the 2001 Tetley's Bitter Cup.
He will sit down with club CEO John Parkinson in the near future to mull over his options, Andrew telling The Journal: "Steve is talking with John about what he wants to do and whether he wants to stay or go."
The arrival of veteran South African lock Mark Andrews could also potentially add to the equation, with the experienced Natal Sharks and Springbok star adding his considerable expertise to the club, mainly in a playing capacity, but possibly in the future on a coaching level.
Bates has been a mainstay of the Falcons' backroom for some time, himself and Andrew being the longest-serving coaching duo in the Premiership to date, Bates also having been instrumental in bringing star fly-half Jonny Wilkinson to the club after teaching him as a schoolboy.
* Meanwhile, tickets for the official opening of the club's impressive newly-refurbished Kingston Park stadium are selling fast, the February 1 Premiership clash with Harlequins seeing the new West Stand fully operational for the first time.
By Mark Smith