Labour Disputes
Texto da decisão
Decision of the
Dispute Resolution Chamber (DRC) judge
passed in Zurich, Switzerland, on 10 February 2015,
by Philippe Diallo (France), DRC judge,
on the claim presented by the player,
Player B, from country A
as Claimant
against the club,
Club D, from country C
as Respondent
regarding an employment-related dispute
arisen between the parties
I.
Facts of the case
1.
On 21 August 2012, the player from country A, Player B (hereinafter: the Claimant), and
the club from country C, Club D (hereinafter: the Respondent), concluded an employment
contract (hereinafter: the first contract) valid “for the period of one year for the football
season 2012-2013”.
2.
According to clause 2 of the first contract, the total remuneration of the Claimant for his
services was of EUR 15,000, payable in ten monthly instalments of EUR 1,500 each, “as the
first instalment to be paid on the 31st of August 2012 and the last to be paid on the 31st of
May 2013 (within 60 days grace period)”.
3.
Equally, the first contract also stipulated the following in its clauses 1 g), 1 m) and 1 i):
“[the Claimant] will always behave in a professional manner both during his
working time and private life time and will not in any case make such actions that
may affect his sporting performance as a player. In case of failing to do so or he
violates the internal regulation of the Football Department, he will accept any
penalty and/or any disciplinary measures ordered by the coach/trainer and/or
[Respondent’s] Disciplinary Committee”;
“[the Claimant] shall obey and comply with all orders and instructions of the
[Respondent] and faithfully observe the rules, regulations and arrangements for
the time being in force for the protection of the [Respondent’s] property and
interests”;
“[the Claimant] shall not at any time be guilty of any act or conduct which may
cause damage, according to the judgement of the [Respondent], to its
property/interests or reputation. He shall respect and at all times conduct himself
with propriety and decorum, and in particular shall obey and comply all the laws,
rules and regulations for the time being in force in country C”.
4.
Furthermore, the parties also signed an undated “contract of image rights” (hereinafter:
the second contract), valid “as long as the Contract of Employment is in force”, which
established that “in consideration of the assignment of his image rights to the
[Respondent] for the period from 31/08/2012 until 31/05/2013 the total sum of Euro
€ 35000 […] net of taxes payable by ten […] equal monthly instalments of € 3500 […], as
the first instalment to be paid on the 31st of August 2012 and the last to be paid on the
31st of May 2013 (with 60 days grace period)”.
5.
Equally, the second contract also stipulated that the Claimant shall receive an additional
amount of EUR 500 per month for his accommodation, a car and air tickets.
6.
On 11 February 2013, the Respondent unilaterally terminated the first and second contract
with the Claimant, in writing, alleging that it had “decided to activate paragraphs 1g, 1m
and 1i of the [first contract]. Particularly the Board of Directors of the [Respondent] took
into consideration the penalty that has been imposed [on the Claimant] by the Disciplinary
Committee of Football Association from country C that prohibits [the Claimant] from
participating into any official match of the Club for 6 consecutive matches due to [his]
unprofessional conduct during the match with Club E. As a result of the penalty imposed
[on the Claimant his] sporting performance to the [Respondent] has been seriously
affected since [he is] not entitled to participate in any official matches damaging in this
manner the interests of the [Respondent]”.
7.
On 18 February 2013, the Claimant lodged a claim before FIFA against the Respondent,
alleging breach of contract without just cause and requesting the payment of the total
amount of EUR 48,664, plus 5% interest p.a., as follows:
a. EUR 22,664 as compensation for breach of contract, plus 5% interest p.a. “starting
from the decision delivery date”;
Player B, from country A / Club D, from country C
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b.
EUR 26,000 corresponding to outstanding monies, plus 5% interest p.a. as from
11 February 2013, as follows:
I. EUR 23,000 corresponding to six outstanding payments based on the first
contract and the second contract (cf. point I.8 below);
II. EUR 3,000 corresponding to the accommodation costs (cf. point I.5 above).
8.
In this respect, the Claimant explained that, on 11 February 2013, the Respondent
terminated the first and second contract without just cause due to his alleged “disciplinary
offences”, which he denies. Equally, the Claimant explained that the Respondent had
allegedly only made partial payments of the amounts stipulated in the first and second
contract totalling EUR 7,000 only.
9.
In its reply, the Respondent disputed the competence of the FIFA Dispute Resolution
Chamber, asserting that the only competent authority to deal with the case is the “Dispute
Resolution Chamber of Football Association from country C”. In this respect, the
Respondent provided FIFA with a copy of the Regulations for the Registration and Transfer
of Football Players of the Football Association from country C (edition 2005; hereinafter:
the regulations of the Football Association from country C).
10.
The Respondent also emphasised that FIFA has no jurisdiction relating to disputes based on
image rights contracts.
11.
With regard to the substance of the dispute, the Respondent rejected the Claimant’s
allegations and explained that, on 12 January 2013, he had allegedly acted
unprofessionally during a first division league match against Club E. As a consequence, he
was fined with EUR 5,250 by the Respondent. In addition, on 25 January 2013, the Football
Association from country C Disciplinary Committee suspended the Claimant for 3
consecutive matches and fined him with EUR 1,000. “Moreover after this decision the
[Claimant] was suspended for a total of 6 consecutive matches.” As a consequence, and
taking into consideration the penalty imposed by the Football Association from country C
Disciplinary Committee and having the primary goal to secure the interests of the
Respondent, the Board of the club decided to terminate both the first contract and the
second contract with the Claimant as of 11 February 2013 (cf. point I.6 above).
12.
With regard to the Claimant’s claim for outstanding payments, the Respondent explained
that it fulfilled all of its obligations and that no further amount is due to him “due to the
fact that any other salary owned to the [Claimant] until the day of the incident was
crossed out through the penalty imposed on the [Claimant] for this unprofessional
behaviour”. Summing up, and also referring to the Claimant’s request for accommodation
costs, the Respondent noted that he has received all his monthly payments and
accommodation fees until the day of the termination of the contract.
13.
In view of all the above-mentioned, the Respondent stated that the termination of the
first and second contract was with just cause and that the Claimant shall be condemned to
pay the Respondent’s incurred legal expenses as well as any procedural costs.
14.
In relation to his contractual situation, the Claimant stated not having signed any other
employment contract from 11 February 2013 until the expiry of the contract with the
Respondent.
II.
Considerations of the DRC judge
1.
First of all, the Dispute Resolution Chamber (DRC) judge (hereinafter: the DRC judge or the
judge) analysed whether he was competent to deal with the matter at stake. In this
respect, the judge referred to art. 21 par. 1 of the Rules Governing the Procedures of the
Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the
Procedural Rules). The present matter was submitted to FIFA on 18 February 2013.
Player B, from country A / Club D, from country C
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Therefore, the DRC judge concluded that the edition 2012 of the Procedural Rules was
applicable to the matter at hand (cf. art. 21 par. 2 and 3 of the Procedural Rules).
2.
Subsequently, the DRC judge referred to art. 3 par. 1 and 2 of the Procedural Rules and
confirmed that, in accordance with art. 24 par. 1 and par. 2 in combination with art. 22 lit.
b) of the Regulations on the Status and Transfer of Players (editions 2012 and 2014), he is,
in principle, competent to decide on an employment-related dispute with an international
dimension, between a player from country A and a club from country C.
3.
However, the DRC judge acknowledged that the Respondent contested the competence of
FIFA's deciding bodies, asserting that the only competent authority to deal with the case is
the “Dispute Resolution Chamber of the Football Association from country C”, based on
the edition 2005 of the regulations of the Football Association from country C.
4.
In this respect, the judge took due note that the Respondent did not base its contestation
of FIFA’s competence on any stipulation of the contract.
5.
Taking into account the above, the DRC judge emphasised that, in accordance with art. 22
lit. b) of the Regulations, he is competent to deal with a matter such as the one at hand,
unless an independent arbitration tribunal guaranteeing fair proceedings and respecting
the principle of equal representation of players and clubs has been established at national
level within the framework of the association and/or a collective bargaining agreement.
With regard to the standards to be imposed on an independent arbitration tribunal
guaranteeing fair proceedings, the DRC judge referred to FIFA Circular no. 1010 dated
20 December 2005. In this regard, the DRC judge further referred to the principles
contained in the FIFA National Dispute Resolution Chamber (NDRC) Standard Regulations,
which came into force on 1 January 2008.
6.
In relation to the above, the DRC judge also deemed it vital to outline that one of the
basic conditions that needs to be met in order to establish that another organ than the
DRC or the DRC judge is competent to settle an employment-related dispute between a
club and a player of an international dimension is that the jurisdiction of the relevant
national arbitration tribunal or national court derives from a clear reference in the
employment contract.
7.
Therefore, while analysing whether he was competent to hear the present matter, the DRC
judge considered that he should, first and foremost, analyse whether the contracts at the
basis of the present dispute actually contained a jurisdiction clause.
8.
Having said this, the DRC judge turned his attention to the content of the aforementioned
contracts and, after a thorough analysis thereof, he concluded that no clear jurisdiction
clause had been inserted in any of those contracts.
9.
Having established that the first criteria for the recognition of the competence of a
national decision-making body is not fulfilled in the present matter, the DRC judge
deemed unnecessary to examine any further points which would need to be assessed
before concluding to the competence of a national deciding body.
10.
In view of the above, the judge established that the Respondent’s objection to the
competence of FIFA to deal with the present matter had to be rejected and that the DRC
judge is in principle competent, on the basis of art. 22 lit. b) of the Regulations on the
Status and Transfer of Players, to consider the present matter as to the substance.
11.
However, the DRC judge also acknowledged that the Respondent contested the
competence of FIFA's deciding bodies highlighting that FIFA has no jurisdiction considering
the claim based on an image rights contract, thus, escaping from the competence scope of
art. 22 of the Regulations.
Player B, from country A / Club D, from country C
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12.
In fact, it remains that the claimed outstanding payments and compensation for breach of
contract under the second contract could possibly not be considered due to the DRC
judge’s lack of competence to deal with disputes related to image rights. The DRC judge,
therefore, had to also verify whether, for formal reasons, he was competent to deal with
this specific component or not.
13.
While analysing whether he was competent to adjudicate on this part of the claim, the
DRC judge wished, without entering into any discussion regarding the actual wording of
the preamble and art. 1 of the second contract nor its title itself, which undoubtedly
defines the contract as an image rights agreement, to highlight that said image rights
contract contained further elements which led to believe that it was not in fact an image
rights contract but rather a separate agreement accidental to the contract, i.e. directly
linked to the services of the Claimant as a player and employee of the Respondent.
14.
As a general rule, if there are separate agreements, the DRC judge tends to consider the
agreement on image rights as such and, therefore, as non-competent to deal with it.
However, such conclusion might be different if specific elements of the separate
agreement suggest that it was in fact meant to be part of the actual employment
relationship. In the case at hand, such elements appear to exist. In particular, the second
contract contains inter alia stipulations regarding the use of a vehicle, accommodation and
flight tickets, which are typical for employment contracts and not for image rights
contracts. Consequently, the DRC judge decided not to consider the second contract as an
image rights contract, but determined that said contract was in fact an additional
agreement to the first contract instead.
15.
In view of all the above, the DRC judge established that the second contract is to be
considered, meaning that he is in a position to take it into consideration when assessing
the Claimant’s claim.
16.
Having established the foregoing, the DRC judge analysed which edition of the
Regulations should be applicable as to the substance of the matter. In this respect, the DRC
judge confirmed that, in accordance with art. 26 par. 1 and 2 of the Regulations and
considering that the present matter was submitted to FIFA on 18 February 2013, the 2012
edition of said Regulations is applicable to the present matter as to the substance.
17.
The competence of the DRC judge and the applicable regulations having been established,
the judge entered into the substance of the matter. In doing so, he started to
acknowledge the facts of the case as well as the documents contained in the file. However,
the DRC judge emphasised that in the following considerations he will refer only to the
facts, arguments and documentary evidence which he considered pertinent for the
assessment of the matter at hand.
18.
In this respect, the DRC judge acknowledged that it was undisputed by the parties that, on
21 August 2012, they had signed the first contract valid “for the period of one year for the
football season 2012-2013”, in accordance with which the Claimant was entitled to receive
the total amount of EUR 15,000, payable in ten monthly instalments of EUR 1,500 each, “as
the first instalment to be paid on the 31st of August 2012 and the last to be paid on the
31st of May 2013 (within 60 days grace period)”.
19.
In addition, the judge further noticed that it was also undisputed by the parties that they
had signed a second contract, valid “as long as the Contract of Employment is in force”, in
accordance with which the Claimant was entitled to receive the total amount of
EUR 35,000 net, payable in ten monthly instalments of EUR 3,500 each, “the first
instalment to be paid on the 31st of August 2012 and the last to be paid on the 31st of May
2013 (with 60 days grace period)”.
Player B, from country A / Club D, from country C
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20.
In continuation, the DRC judge also took note that it was undisputed that the contractual
relationship between the parties to the present dispute was terminated by the Respondent
on 11 February 2013, when the Respondent submitted its termination letter to the
Claimant.
21.
In this regard, the judge noted that the Claimant, on the one hand, argued that the
Respondent had unilaterally terminated the contractual relationship without just cause on
11 February 2013, justifying said decision by alleging that “the sporting performance to
the [Respondent] has been seriously affected” due to the Claimant’s alleged
unprofessional conduct and the ensuing penalty and ban imposed on him by the
Disciplinary Committee of the Football Association from country C. As a consequence, the
DRC judge took due note that the Claimant is now asking to be awarded the total amount
of EUR 48,664, consisting of outstanding monies and compensation for breach of contract,
as well as 5% interest p.a.
22.
The DRC judge further noted that the Respondent, on the other hand, insisted on having
terminated the first and second contract with the Claimant with just cause based on his
alleged unprofessional behaviour during a first division league match on 12 January 2013.
In this context, the judge took due note that the Claimant was fined by the Respondent
with EUR 5,250 and was additionally also fined with EUR 1,000 by the Football Association
from country C Disciplinary Committee and, ultimately, suspended by the Football
Association from country C Disciplinary Committee for a total of 6 consecutive matches. As
a consequence, so the Respondent, it terminated both contracts with just cause in order to
“secure the interests of the [Respondent]”. Finally, the DRC judge also took note of the
Respondent’s explanation with regard to the Claimant’s outstanding monies, by means of
which it stated having fulfilled all of its obligations and that no further amount was due to
the Claimant “due to the fact that any other salary owned to the [Claimant] until the day
of the incident was crossed out through the penalty imposed on the [Claimant] for this
unprofessional behaviour”.
23.
Having established the aforementioned, the judge deemed that the underlying issue in
this dispute, considering the claim of the Claimant and the allegations of the Respondent,
was to determine whether the first contract and the second contract had been unilaterally
terminated with or without just cause by the Respondent.
24.
In view of the above, the judge subsequently went on to deliberate as to whether the
Claimant’s alleged serious misconduct, which is invoked by the Respondent in its defence,
can be considered as a just cause for the Respondent to prematurely terminate the
employment relationship.
25.
In this context, and for the sake of good order, the DRC judge deemed it appropriate to
remind the parties of the basic principle of burden of proof, as stipulated in art. 12 par. 3
of the Procedural Rules, according to which a party claiming a right on the basis of an
alleged fact shall carry the respective burden of proof. Bearing in mind the
aforementioned principle, the DRC judge noted that in the present dispute the
Respondent bore the burden of proof regarding the existence of a just cause for the
premature and unilateral termination of the contracts.
26.
In this regard, the judge deemed it necessary to highlight that the Respondent did not
submit any documentary evidence with regard to the Claimant’s alleged misconduct and
that, therefore, not even the actual existence thereof could be established.
27.
Notwithstanding the foregoing, the DRC judge also pointed out that the Claimant’s
alleged misconduct, i.e. his unprofessional behaviour during a first division league match
on 12 January 2013, could not constitute, per se, a valid reason for the termination of an
employment contract. Only a breach or misconduct which is of certain severity would
justify the termination of a contract. In other words, only when there are objective criteria
Player B, from country A / Club D, from country C
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which do not reasonably permit to expect a continuation of the employment relationship
between the parties, a contract may be terminated prematurely. Hence, if there are more
lenient measures which can be taken in order for an employer to assure the employee’s
fulfilment of his contractual duties, such measures must be taken before terminating an
employment contract. A premature termination of an employment contract can only ever
be an ultima ratio measure.
28.
In view of all the above, the judge was of the opinion that the objective circumstances at
the time did not provide the Respondent with just cause to prematurely terminate the
contracts concluded with the Claimant, since there would have been more lenient and
proportionate measures to be taken, in order to sanction the alleged misconduct, which
was apparently at the basis of the termination of the employment relationship by the
Respondent.
29.
Overall, the DRC judge decided that there was no just cause to unilaterally terminate the
employment relationship between the Claimant and the Respondent and that, therefore,
the Respondent had terminated both contracts on 11 February 2013 without just cause.
30.
Having established that the Respondent is to be held liable for the early termination of the
contracts without just cause, the DRC judge focused his attention on the consequences of
such termination. Taking into consideration art. 17 par. 1 of the Regulations, the DRC
judge decided that the Claimant is entitled to receive from the Respondent an amount of
money as compensation for breach of contract in addition to any outstanding payments,
on the basis of the first and second contract.
31.
First of all, the judge reverted to the Claimant’s claim, which includes outstanding monies
of EUR 26,000 based on both contracts.
32.
In this respect, the DRC judge recalled that the Respondent did not dispute the fact that
the Claimant’s outstanding monies have not been paid but deemed that fines imposed on
the Claimant for alleged undisciplined behaviour, were to be deducted from the amount
owed to him. Consequently, the Respondent claimed that there was no amount owed to
the Claimant.
33.
In this context, the DRC judge concurred that the fine imposed on the Claimant by the
Respondent shall be disregarded, since a) the Respondent did not prove any alleged
unprofessional behaviour, and b) the total amount of the fine allegedly imposed on the
Claimant by the Respondent (i.e. EUR 5,250) represents more than one monthly
remuneration and, consequently, must be considered disproportionate.
34.
In addition, and irrespective of the foregoing consideration, the judge wished to address
the fact that the imposition of a fine, or any other available financial sanction in general,
shall not be used by clubs as a method to set off outstanding financial obligations towards
players. Consequently, the DRC judge decided to reject the Respondent’s argument in this
regard.
35.
Consequently, taking into account the disproportionate fine imposed by the Respondent
on the Claimant, the lack of documentary evidence provided by the Respondent in this
respect and the fact that both contracts are to be considered as terminated as of
11 February 2013, the DRC judge decided that, in accordance with the general legal
principle of pacta sunt servanda, the Respondent is liable to pay to the Claimant the
remuneration that was outstanding at the time of the termination i.e. the amount of
EUR 26,000, plus interest of 5% p.a. as from 11 February 2013.
36.
In continuation, the judge focused his attention on the calculation of the amount of
compensation for breach of contract in the case at stake. In doing so, the DRC judge firstly
recapitulated that, in accordance with art. 17 par. 1 of the Regulations, the amount of
compensation shall be calculated, in particular and unless otherwise provided for in the
Player B, from country A / Club D, from country C
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contract at the basis of the dispute, with due consideration for the law of the country
concerned, the specificity of sport and any other objective criteria, including, in particular,
the remuneration and other benefits due to the Claimant under the existing contract
and/or the new contract, the time remaining on the existing contract up to a maximum of
five years, and depending on whether the contractual breach falls within the protected
period.
37.
In application of the relevant provision, the DRC judge held that, first of all, he had to
clarify as to whether the contracts contained a provision by means of which the parties
had beforehand agreed upon an amount of compensation payable by the parties in the
event of breach of contract. In this regard, the judge established that no such
compensation clause was included in the contracts.
38.
As a consequence, the DRC judge determined that the amount of compensation payable
by the Respondent to the Claimant had to be assessed in application of the other
parameters set out in art. 17 par. 1 of the Regulations. The judge recalled that said
provision provides for a non-exhaustive enumeration of criteria to be taken into
consideration when calculating the amount of payable compensation.
39.
Bearing in mind the foregoing as well as the claim of the Claimant, the DRC judge
proceeded with the calculation of the amount payable to the Claimant under the terms of
both contracts until 31 May 2013. The judge concluded that the amount of EUR 22,500,
corresponding to the Claimant’s remuneration and accommodation for 4 residual months,
serves as the basis for the final determination of the amount of compensation for breach
of contract.
40.
In continuation, the DRC judge verified as to whether the Claimant had signed an
employment contract with another club during the relevant period of time, by means of
which he would have been able to reduce his loss of income. According to the constant
practice of the DRC, such remuneration under a new employment contract shall be taken
into account in the calculation of the amount of compensation for breach of contract in
connection with the player’s general obligation to mitigate his damages.
41.
In this regard, the judge took into account that the Claimant had not signed any
employment contract with another club between 11 February 2013 and 31 May 2013,
i.e. during the residual validity of the contract with the Respondent.
42.
Consequently, and bearing in mind all of the above-mentioned considerations and the
specificities of the case at hand, the DRC judge decided that the Respondent must pay the
amount of EUR 22,500 plus 5% interest p.a. as from 10 February 2015 until the date of
effective payment to the Claimant (cf. point II.39. above), which was to be considered a
reasonable and justified amount of compensation for breach of contract in the present
matter, in addition to the amount of EUR 26,000 as outstanding remuneration plus 5%
interest p.a. as from 11 February 2013 until the date of effective payment.
43.
The DRC judge concluded his deliberations in the present matter by establishing that any
further claims lodged by the Claimant are rejected.
III.
Decision of the DRC judge
1.
The claim of the Claimant, Player B, is admissible.
2.
The claim of the Claimant is partially accepted.
Player B, from country A / Club D, from country C
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3.
The Respondent, Club D, is ordered to pay to the Claimant outstanding remuneration in
the amount of EUR 26,000 plus 5% interest p.a. as from 11 February 2013 until the date of
effective payment, within 30 days as from the date of notification of this decision.
4.
The Respondent is ordered to pay to the Claimant compensation for breach of contract in
the amount of EUR 22,500 plus 5% interest p.a. as from 10 February 2015 until the date of
effective payment, within 30 days as from the date of notification of this decision.
5.
In the event that the amounts due to the Claimant in accordance with the abovementioned numbers 3. and 4. plus interest are not paid within the above-mentioned time
limit, the present matter shall be submitted, upon request, to the FIFA Disciplinary
Committee for its consideration and a formal decision.
6.
Any further claims lodged by the Claimant are rejected.
7.
The Claimant is directed to inform the Respondent immediately and directly of the account
number to which the remittances are to be made and to notify the DRC judge of every
payment received.
*****
Note relating to the motivated decision (legal remedy):
According to article 67 par. 1 of the FIFA Statutes, this decision may be appealed against before
the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS
directly within 21 days of receipt of notification of this decision and shall contain all the
elements in accordance with point 2 of the directives issued by the CAS, a copy of which we
enclose hereto. Within another 10 days following the expiry of the time limit for filing the
statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving
rise to the appeal with the CAS (cf. point 4 of the directives).
The full address and contact numbers of the CAS are the following:
Court of Arbitration for Sport
Avenue de Beaumont 2
1012 Lausanne
Switzerland
Tel: +41 21 613 50 00
Fax: +41 21 613 50 01
e-mail: [email protected]
www.tas-cas.org
For the DRC judge
Jérôme Valcke
Secretary General
Player B, from country A / Club D, from country C
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Encl.
CAS directives
Player B, from country A / Club D, from country C
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