Labour Disputes
Texto da decisão
Decision of the
Dispute Resolution Chamber
passed in Zurich, Switzerland, on 25 September 2015,
in the following composition:
Geoff Thompson (England), Chairman
Carlos González Puche (Colombia), member
Theo van Seggelen (Netherlands), member
Guillermo Saltos Guale (Ecuador), member
Alejandro Marón (Argentina), member
on the matter between the player,
Player A, country B
as Claimant / Counter-Respondent
and the club,
Club C, country D
as Respondent / Counter-Claimant
and the club,
Club E, country F
as Intervening Party
regarding an employment-related dispute arisen between the parties
I.
Facts of the case
1.
On an unspecified date, the player from country B, Player A (hereinafter: player or
Claimant/Counter-Respondent) and the club from country D, Club C (hereinafter: club
or Respondent/Counter-Claimant) signed an employment contract valid for a period of
two years, expiring on 30 June 2014 (hereinafter: the contract).
2.
According to the contract, the player was entitled to receive, inter alia, the following
amounts:
a monthly salary of EUR 9,400, payable on the 25th day of the next month;
a payment of EUR 10,000, due on 1 August 2012;
as from 1 July 2013, a monthly salary of EUR 11,200, payable on the 25th day of
the next month;
a payment of EUR 10,000, due on 1 August 2013.
3.
The player states that the club failed to pay him the salaries for the months of
February 2013 and March 2013, as well as the payment due on 1 August 2012, which
was on 20 May 2013 reason for him to put the club in default and ask for the payment
of said salaries within two days.
4.
On 3 June 2013, the player again put the club in default, for not having paid the
salaries for the months of February 2013, March 2013 and April 2013. Further, the
player informed the club that if said salaries were not paid within 2 days, he would
‘exercise the right to immediately terminate the labor contract with just cause’.
According to the player, the club did not pay the requested amount.
5.
Finally, on 10 June 2013, the player terminated the contract with immediate effect.
6.
On 14 July 2013, the player lodged a claim before FIFA against the club, claiming the
total amount of EUR 191,400, plus 5% interest, as follows:
payment of outstanding remuneration in the amount of EUR 37,600,
corresponding to 4 salary payments of EUR 9,400 each, related to the months of
February, March, April and May 2013;
compensation for breach of contract by the club in the amount of EUR 153,800, as
follows:
- EUR 9,400 as the residual value of the contract in the month June 2013;
- EUR 134,400 as the residual value of the contract in the period between
July 2013 and June 2014;
- EUR 10,000 as the payment due on 1 August 2013.
Additionally, the player requests that the club should be ordered to pay his legal fees
and the costs of the proceeding.
7.
On 29 August 2013, the club replied to the player’s claim, by arguing that the three
delayed salaries as mentioned by the player qualify ‘as insubstantial in comparison
Player A, country B / Club C, country D / Club E, country F Page 2 of 11
with the financial obligations’ and further stating that ‘the mere fact that the payment
of three salaries appeared to have been delayed should not be overestimated’.
8.
Furthermore, according to the club, the power of attorney attached to the player’s
first default letter of 20 May 2013, did not mention that Mr G was entitled to
represent the player ‘before Club C for the purpose of notifying the latter regarding
breach of contract and terminating the contract in case of non-compliance with the
warning’. In addition, the club states that it immediately reacted to the player’s first
default letter and paid him EUR 10,000 on 21 May 2013.
9.
With respect to the second default letter, the club states that it did not to comply with
the Labor Code of country D, which stipulates that salaries are either paid in cash, or if an employee explicitly requests this in writing – to other persons than the employee.
According to the club, the legal representative of the player was not authorised by the
player to instruct the club to pay the remuneration to the bank account indicated by
the legal representative in the letter dated 3 June 2013, which left the club with no
other option than to pay the salaries in cash. However, the club argues that the
payment in cash was impossible, because the player left country D in June 2013.
10.
In addition, the club argues that the first default letter gave a very short period for
payment (i.e. 2 days) and the second default letter was not valid because the sender
(i.e. the player’s legal representative) was not authorized to 1) request for the alleged
outstanding payments and 2) indicate a bank account for such payments. As a result
thereof, the club was ‘not given a chance to avoid the termination’.
11.
The club concludes that the player had no just cause to terminate the contract and
that therefore, no compensation is due to the player.
12.
Moreover, the club argues that the player terminated the contract without having just
cause and claims compensation of EUR 112,400 for breach of contract by the player,
plus interest as from 10 June 2013. According to the club, this amount corresponds to
the residual value of the contract (EUR 129,067), plus an additional compensation for
breach of contract during the protected period (EUR 20,933), minus three monthly
salaries in the total amount of EUR 37,600, which are to be paid by the club.
13.
Despite being invited to do so, the player did not respond to the counterclaim within
the investigation-phase of the matter, but only after the closure of investigation. On
28 April 2015, the player answered to the counterclaim of the club, by stating that on
the date of termination of the contract, the club failed to pay him three monthly
salaries, which gave him just cause to unilaterally terminate the contract on 10 June
2013.
14.
Further, the player argued that it was the obligation of the club to punctually pay the
salaries of its employees; however, it did not provide any evidence that it actually did
Player A, country B / Club C, country D / Club E, country F Page 3 of 11
so or that it tried to solve the matter as soon as possible. Finally, the player argues that
the periods for payment in his default letters were not extremely short, and that the
fact that the power of attorney did not give his legal representative the right to ask
for payment of monies, was ‘merely an error in the writing’.
15.
Upon request, the player provided FIFA with a contract signed with the club from
country F, Club E, valid as from 15 August 2013 until 31 December 2014, according to
which the player was entitled to receive a monthly salary of 1,425.
16.
Nevertheless, according to the information contained in the Transfer Matching System
(TMS), the player received an additional monthly payment of USD 10,000 (if he was
participating in less than 50% of the matched played by Club E), an additional monthly
payment of USD 12,000 (if he was participating in 50% or more of the matched played
by Club E) or an additional monthly payment of USD 15,000 (if he was participating in
50% or more of the matched played by Club E in the starting squad).
17.
Despite being invited to do so, the new club of the player, Club E did not present its
comments.
II.
Considerations of the Dispute Resolution Chamber
1.
First of all, the Dispute Resolution Chamber (hereinafter also referred to as Chamber or
DRC) analysed whether it was competent to deal with the matter at hand. In this
respect, it took note that the present matter was submitted to FIFA on 14 July 2013.
Consequently, the Rules governing the procedures of the Players’ Status Committee
and the Dispute Resolution Chamber (edition 2012; hereinafter: Procedural Rules) are
applicable to the matter at hand (cf. art. 21 of the Procedural Rules).
2.
Subsequently, the members of the Chamber referred to art. 3 par. 1 of the Procedural
Rules and confirmed that in accordance with art. 24 par. 1 in combination with art. 22
lit. b of the Regulations on the Status and Transfer of Players (edition 2015) the
Dispute Resolution Chamber is competent to deal with the matter at stake, which
concerns an employment-related dispute with an international dimension between a
player from country B and a club from country D, with the involvement of a club from
country F.
3.
Furthermore, the Chamber analysed which regulations should be applicable as to the
substance of the matter. In this respect, it confirmed that in accordance with art. 26
par. 1 and 2 of the Regulations on the Status and Transfer of Players (edition 2015),
and considering that the present claim was lodged on 14 July 2013, the 2012 edition of
said regulations (hereinafter: Regulations) is applicable to the matter at hand as to the
substance.
Player A, country B / Club C, country D / Club E, country F Page 4 of 11
4.
The competence of the Chamber and the applicable regulations having been
established, the Chamber entered into the substance of the matter. In this respect, the
Chamber started by acknowledging all the above-mentioned facts as well as the
arguments and the documentation submitted by the parties. However, the Chamber
emphasised that in the following considerations it will refer only to the facts,
arguments and documentary evidence, which it considered pertinent for the
assessment of the matter at hand.
5.
In continuation, the members of the Chamber noted that the Claimant/CounterRespondent lodged a claim against the Respondent/Counter-Claimant maintaining that
he had terminated the employment contract with just cause on 10 June 2013, after
previously having put the Respondent/Counter-Claimant in default, since it allegedly
failed to pay his remuneration.
6.
The Respondent/Counter-Claimant, on the other hand, rejects such claim and lodged a
counterclaim against the Claimant/Counter-Respondent maintaining that the latter
had terminated the contract on 10 June 2013 without just cause and claiming EUR
112,400 as compensation for the unjustified termination of the contract by the
Claimant/Counter-Respondent.
7.
In this context, the members of the Chamber highlighted that the central issue in the
matter at stake would be, thus, to determine as to whether the Claimant/CounterRespondent had just cause to terminate the contract on 10 June 2013. The members of
the Chamber also underlined that, subsequently, after the determination whether the
contract was terminated by the Claimant/Counter-Respondent with or without just
cause, it would be necessary to determine the consequences of such termination.
8.
In this respect, the Claimant/Counter-Respondent submits to not have received the
monthly salaries corresponding to the months February, March and April 2013 from
the Respondent/Counter-Claimant at the time he terminated the employment
contract. Consequently, the Claimant/Counter-Respondent asks to be awarded his
outstanding dues as well as the payment of compensation for breach of the
employment contract.
9.
The Chamber then turned its attention to the arguments of the Respondent/CounterClaimant stating that the Claimant/Counter-Respondent had no just cause to terminate
the contract, since (a) there was only an insubstantial amount of salary payments
outstanding on 10 June 2013, (b) the Claimant/Counter-Respondent did not properly
authorize his legal representative to request for the remuneration the
Respondent/Counter-Claimant had to pay to him and (c) the Claimant/CounterRespondent did not validly and properly warn the Respondent/Counter-Claimant
about his intention to terminate the contract.
Player A, country B / Club C, country D / Club E, country F Page 5 of 11
10.
In this context, the members of the Chamber first noted that the Respondent/CounterClaimant did not contest that on the day of termination of the contract, i.e. 10 June
2013, three monthly salaries of EUR 9,400 each had not been paid. Further, the
Chamber took into account that in accordance with the employment contract, the
Respondent/Counter-Claimant should have paid to the Claimant/Counter-Respondent
at the time the contract was terminated by the Claimant/Counter-Respondent, i.e. on
10 June 2013, the total amount of EUR 28,200 as salary corresponding to the months
February, March and April 2013, due on the 25th day of the respective following
month.
11.
In this regard, the members of the Chamber were of the opinion that three
outstanding monthly salaries cannot qualify as ‘insubstantial’ and that therefore, the
Respondent/Counter-Claimant seriously neglected its financial contractual obligations
towards the Claimant/Counter-Respondent.
12.
Furthermore, the members of the Chamber analysed whether the Respondent/CounterClaimant had submitted valid reasons for not timely paying the requested amounts.
13.
Turning to the Respondent/Counter-Claimant’s argument that it could not pay the
aforementioned amounts in time, and that it had no proper chance to avoid the
termination of the contract, because the power of attorney submitted by the
Claimant/Counter-Respondent did not gave his legal representative the authorization
to request for the outstanding amounts, the members of the Chamber established that
such position is not backed by DRC jurisprudence. The mere fact that the power of
attorney allegedly did not mention that the Claimant/Counter-Respondent’s legal
representative was authorized to request for the outstanding payments, does not
release the Respondent/Counter-Claimant from its contractual obligation to timely pay
the contractually agreed remuneration.
14.
Furthermore, the members of the Chamber focused on the argument of the
Respondent/Counter-Claimant that it had no proper chance to avoid the termination
of the contract, since the deadlines for payment in the default letters of the
Claimant/Counter-Respondent were ‘very short’.
15.
In this respect, the Respondent/Counter-Claimant was informed on 20 May 2013 and 3
June 2013 about the outstanding amounts, and, on 21 May 2013, it paid the
Claimant/Counter-Respondent the amount of EUR 10,000. However, the
Respondent/Counter-Claimant failed to remit the remaining outstanding amounts to
the Claimant/Counter-Respondent until 10 June 2013, i.e. 20 days after the first default
letter. Therefore, in the Chamber’s view, the Respondent/Counter-Claimant had a
proper opportunity to avoid the termination of the contract, however it failed to do
so.
Player A, country B / Club C, country D / Club E, country F Page 6 of 11
16.
In this framework, the members of the Chamber turned to the counterclaim lodged by
the Respondent/Counter-Claimant, which maintains that the Claimant/CounterRespondent terminated the contract without just cause. The Chamber observed that
the Claimant/Counter-Respondent, in spite of having been invited to do so, failed to
present his response to the claim of the Claimant within the relevant time-limit. In fact,
the reply of the Claimant/Counter-Respondent was only received after the
investigation-phase of the matter had already been concluded. As a result, the DRC
decided not to take into account the reply of the Claimant/Counter-Respondent and
established that, in accordance with art. 9 par. 3 of the Procedural Rules, it shall take a
decision upon the basis of those documents on file that were provided prior to the
closure of the investigation-phase.
17.
Despite the reply of the Claimant/Counter-Respondent not being taken into account,
the Chamber was of the opinion that based on the documents on file, it could be
established that the Respondent/Counter-Claimant did not timely pay three monthly
salaries in the total amount of EUR 28,200, corresponding to the months of February,
March and April 2013, which had fallen due and remained outstanding at the time of
the termination of the contract, i.e. 10 June 2013.
18.
Consequently, and reiterating the Chamber’s jurisprudence at this point, the Chamber
decided that the Respondent/Counter-Claimant was repeatedly and for a significant
period of time been in breach of its contractual obligations towards the
Claimant/Counter-Respondent. As a result thereof, the Chamber decided that the
Claimant/Counter-Respondent had just cause to unilaterally terminate the employment
contract on 10 June 2013, having previously put the Respondent/Counter-Claimant in
default.
19.
As a result of the aforementioned considerations, the Chamber concluded that the
Respondent/Counter-Claimant is to be held liable for the early termination of the
employment contact with just cause by the Claimant/Counter-Respondent. In
continuation, the Chamber focused its attention on the consequences of such
termination.
20.
First of all, the members of the Chamber concurred that the Respondent/CounterClaimant must fulfil its obligations as per the contract in accordance with the general
legal principle of “pacta sunt servanda”. Consequently, the Chamber decided that the
Respondent/Counter-Claimant is liable to pay to the Claimant/Counter-Respondent the
remuneration for the months during which the Claimant was employed by the
Respondent but had not yet been paid at the time of the termination, i.e. the amount
of EUR 37,600, consisting of the salaries for February, March, April and May 2013 in the
amount of EUR 9,400 each. In this respect, the Chamber clarified that although the
salary for May 2013 only fell due on 25 June 2013, it should be included in the
calculation for the outstanding remuneration since the relevant payment
Player A, country B / Club C, country D / Club E, country F Page 7 of 11
corresponded to the remuneration earned in a month prior to the termination of the
contract.
21.
Furthermore, and considering the Claimant/Counter-Respondent’s claim for interest,
the Chamber ruled that the Respondent must pay 5% interest on the amount of EUR
37,600 as from the date of claim, i.e. 14 July 2013.
22.
In continuation, the Chamber decided that, taking into consideration art. 17 par. 1 of
the Regulations, the Claimant/Counter-Respondent is entitled to receive from the
Respondent compensation for breach of contract in addition to any outstanding
salaries on the basis of the relevant employment contract.
23.
Having stated the above, the Chamber turned to the calculation of the amount of
compensation
payable
to
the
Claimant/Counter-Respondent
by
the
Respondent/Counter-Claimant in the case at stake. In doing so, the members of the
Chamber 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 contract at the basis of the dispute, with due consideration for the
law of the country concerned, the specificity of sport and further objective criteria,
including in particular, the remuneration and other benefits due to the
Claimant/Counter-Respondent 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.
24.
In application of the relevant provision, the Chamber held that it first of all had to
clarify as to whether the pertinent employment contract contained a provision by
means of which the parties had beforehand agreed upon an amount of compensation
payable by the contractual parties in the event of breach of contract. In this regard,
the Chamber established that no such compensation clause was included in the
employment contract at the basis of the matter at stake.
25.
As a consequence, the members of the Chamber determined that the amount of
compensation payable by the Respondent/Counter-Claimant to the Claimant/CounterRespondent had to be assessed in application of the other parameters set out in art. 17
par. 1 of the Regulations. The Chamber recalled that said provision provides for a nonexhaustive enumeration of criteria to be taken into consideration when calculating the
amount of compensation payable.
26.
Bearing in mind the foregoing, the Chamber proceeded with the calculation of the
monies payable to the Claimant/Counter-Respondent under the terms of the contract
as from its date of termination with just cause by the Claimant/Counter-Respondent,
i.e. 10 June 2013, until 30 June 2014, and concluded that the Claimant/CounterRespondent would have received in total EUR 153,800 as remuneration had the
contract been executed until its expiry date. Consequently, the Chamber concluded
Player A, country B / Club C, country D / Club E, country F Page 8 of 11
that the amount of EUR 153,800 serves as the basis for the final determination of the
amount of compensation for breach of contract in the case at hand.
27.
In continuation, the Chamber verified as to whether the Claimant/Counter-Respondent
had signed an employment contract with another club during the relevant period of
time, by means of which he would have been enabled 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.
28.
In this respect, the Chamber noted that on 15 August 2013, the Claimant/CounterRespondent found employment with the club from country F, Club E. In accordance
with the pertinent employment contract, which has been made available by the
Claimant/Counter-Respondent, valid until 31 December 2014, the Claimant/CounterRespondent was entitled to receive a monthly salary of 1,425.
29.
Furthermore, the Chamber took note that on 15 August 2013 the Claimant/CounterRespondent signed a second contract with Club E. In accordance with this second
employment contract - which has not been made available by the Claimant/CounterRespondent but which was uploaded in the Transfer Matching System (TMS) - the
Claimant/Counter-Respondent was entitled to receive an additional monthly payment
of at least USD 10,000. For the period of 15 August 2013 to June 2014, this corresponds
to a minimum total amount of USD 105,000.
30.
Consequently, the Chamber established that the value of the new employment
contract concluded between the Claimant/Counter-Respondent and Club E for the
period as from 15 August 2013 until 30 June 2014 amounted to approximately EUR
81,500 and that the Claimant/Counter-Respondent was able to mitigate his damages
with said amount.
31.
As a result, on account of all of the above-mentioned considerations and the
specificities of the case at hand as well as the Claimant/Counter-Respondent’s general
obligation to mitigate his damage, the Chamber decided to partially accept the
Claimant/Counter-Respondent’s claim and that the Respondent/Counter-Claimant must
pay the amount of EUR 72,300 as compensation for breach of contract in the case at
hand.
32.
In addition, taking into account the Claimant/Counter-Respondent’s request as well as
the constant practice of the Chamber, the Chamber decided that the
Respondent/Counter-Claimant must pay to the Claimant/Counter-Respondent interest
of 5% p.a. on the amount of compensation as of the date the claim was lodged, i.e. 14
July 2013 until the date of effective payment.
Player A, country B / Club C, country D / Club E, country F Page 9 of 11
33.
Moreover, the Chamber decided to reject the Claimant/Counter-Respondent’s claim
pertaining to legal costs in accordance with art. 18 par. 4 of the Procedural Rules and
the Chamber’s respective longstanding jurisprudence in this regard.
34.
Furthermore, the members of the Chamber decided to reject any further claim lodged
by the Claimant/Counter-Respondent.
35.
The Chamber concluded its deliberations in the present matter by rejecting the
counterclaim lodged by the Respondent/Counter-Claimant.
*****
III.
Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant / Counter-Respondent, Player A, is partially accepted.
2.
The counterclaim of the Respondent / Counter-Claimant, Club C, is rejected.
3.
The Respondent / Counter-Claimant, has to pay to the Claimant / Counter-Respondent,
within 30 days as from the date of notification of this decision, outstanding
remuneration in the amount of EUR 37,600 plus 5% interest p.a. as from 14 July 2013
until the date of effective payment.
4.
The Respondent / Counter-Claimant, has to pay to the Claimant / Counter-Respondent,
within 30 days as from the date of notification of this decision, compensation for
breach of contract in the amount of EUR 72,300 plus 5% interest p.a. on said amount
as from 14 July 2013 until the date of effective payment.
5.
In the event that the amounts due to the Claimant / Counter-Respondent in
accordance with the above-mentioned numbers 3. and 4. are not paid by the
Respondent / Counter-Claimant within the stated time limits, the present matter shall
be submitted, upon request, to the FIFA Disciplinary Committee for consideration and
a formal decision.
6.
Any further claim lodged by the Claimant / Counter-Respondent is rejected.
7.
The Claimant / Counter-Respondent is directed to inform the Respondent / CounterClaimant immediately and directly of the account number to which the remittances are
to be made and to notify the Dispute Resolution Chamber of every payment received.
Player A, country B / Club C, country D / Club E, country F Page 10 of 11
*****
Note relating to the motivated decision (legal remedy):
According to art. 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 Dispute Resolution Chamber:
Markus Kattner
Acting Secretary General
Encl. CAS directives
Player A, country B / Club C, country D / Club E, country F Page 11 of 11