Labour Disputes
Texto da decisão
REF. FPSD-xxxxx
Decision of the
Dispute Resolution Chamber
passed on 23 September 2024
regarding an employment-related dispute concerning the player A
COMPOSITION:
Martín Auletta (Argentina), Deputy Chairperson
Stefano Sartori (Italy), Member
Jorge Gutiérrez (Costa Rica), Member
CLAIMANT:
Player A, Country A
Represented by
RESPONDENT:
Club B, Country B
pg. 2
REF. FPSD-xxxxx
I. Facts of the case
1.
On 15 September 2023, the Country A Player A (hereinafter: Claimant or player) and the
Country B Club B (hereinafter: club or Respondent) concluded an employment contract
(hereinafter: the Contract) valid as from the date of signature until 30 June 2026.
2.
In accordance with the Contract, the Respondent undertook to pay to the Claimant inter
alia the following remuneration:
-
2023/2024 season: EUR 850,000 net in total, payable in 10 monthly instalments of
EUR 85,000 net between October 2023 and July 2024
-
2024/2025 season: EUR 900,000 net in total, payable in 10 monthly instalments of
EUR 90,000 net between September 2024 and June 2025;
-
2025/2026 season: EUR 950,000 net in total, payable in 10 monthly instalments of
EUR 95,000 net between September 2025 and June 2026;
-
Seasonal guarantee bonus payable at the end of each respective season (i.e., on 30
June 2024, -2025 and -2026 respectively, subject to the following condition:
“All extra bonuses that the player will receive from the team’s win and draw will be
deducted form the EUR 50,000 guarantee bonus. The remaining amount from the balance
of the guarantee bonus will be paid to the player on 30 June xxxx.”
-
EUR 12,500 net each season for accommodation, car, flight tickets and other
expenses.
3.
On 7 May 2024, the Claimant put the Respondent in default of payment of EUR 354,248.14
net, requesting payment thereof as soon as possible and in accordance with art. 14bis of
the FIFA Regulations on the Status and Transfer of Players.
4.
On 21 May 2024, the Claimant sent a further correspondence to the Respondent, specifying
that he agrees not to file a claim before FIFA if the Respondent proceeds with the following
agreed arrangement:
-
EUR 50,000 payable by 24 May 2024;
-
EUR 250,000 payable by 29 May 2024;
-
EUR 380,000 payable by 30 June 2024;
-
EUR 55,000 payable by 30 July 2024.
pg. 3
REF. FPSD-xxxxx
5.
Furthermore, the same correspondence stated as follows:
“If the club doesn’t pay only one payment deadline, the club accepts that the contract is breaken
for just reasons, and the player will be free in 10 days (this rule is available after the first
payment).”
6.
On the same day, the Respondent replied: “We are ok with this conditions”.
7.
On 24 May 2024, the Respondent made a payment of EUR 50,000 towards the Claimant.
8.
On 10 June 2024, the Claimant sent a unilateral termination notice to the Respondent,
outlining that the Respondent only paid the first instalment of EUR 50,000, and that the
second instalment of EUR 250,000 due on 29 May 2024 remained outstanding. Hence, the
Claimant stated that he considered the prior payment arrangement void, and offered the
club once again to avoid lodging a claim in case the following payments would be remitted:
9.
-
EUR 250,000 before 14 June 2024;
-
EUR 235,000 before 28 June 2024;
-
EUR 200,000 before 30 July 2024;
-
EUR 150,000 before 30 August 2024;
-
EUR 100,000 before 30 September 2024;
-
EUR 100,000 before 30 October 2024.
Furthermore, the Claimant’s correspondence stated as follows:
If the club doesn’t pay only one payment deadline, the totality of the sums due under the contract
will be due, i.e., an amount of EUR 2,635,000 until 30 June 2026, less the sums which have been
paid under this agreement”.
10. On 11 June 2024 (i.e., the following day), the Respondent replied that it agreed to the
abovementioned terms, as long as the sentence stating “If the club doesn’t pay only one
payment deadline, the totality of the sums due under the contract will be due, i.e., an amount
of EUR 2,635,000 until 30 June 2026, less the sums which have been paid under this agreement”
would be removed therefrom.”
11. On the same day, the Claimant replied, agreeing to remove said paragraph from the
wording of the agreement, however, stating that if the first payment was not made in a
timely manner (i.e., until 14 June 2024 COB), the agreement would be void and he would
claim compensation before FIFA.
pg. 4
REF. FPSD-xxxxx
12. On 13 June 2024, the Claimant sent the Respondent a reminder as to the above payment
obligation.
13. On 26 June 2024, the Claimant sent a further letter to the Respondent, confirming that he
considered the Contract terminated as from 14 June 2024, given that the payment
scheduled for said date was not made by the latter.
14. On 1 October 2024, the Claimant signed an employment contract with the Country C club
Club C, valid as from the date of signature until 30 June 2025 (hereinafter: the New
Contract).
15. In accordance with the New Contract, the Claimant was entitled to the following
remuneration:
-
Country C currency 365,000 signature bonus, payable in two equal instalments on 1
November 2024 and 1 February 2025 respectively;
-
Country C currency 164,250 monthly salary, payable at the end of each respective
month between 1 October 2024 and 30 June 2025.
II. Proceedings before FIFA
16. On 19 June 2024, the Claimant filed the claim at hand before FIFA. A summary of the parties’
position is detailed below.
a. Position of the Claimant
17. According to the Claimant, the Respondent failed to comply with the financial obligations
of the Contract, despite having been put in default several times and despite various
attempts by the Claimant to amicably resolve the dispute.
18. Consequently, the Claimant asserted that he had a just cause in accordance with art. 14bis
of the FIFA Regulations on the Status and Transfer of Players to terminate the Contract
prematurely.
19. Without specifying net or gross or including a request for interests in his request for relief,
the Claimant requested as follows:
-
EUR 685,000 as outstanding salaries;
-
EUR 2,000,000 as compensation;
-
Sporting sanctions on the Respondent.
pg. 5
REF. FPSD-xxxxx
b. Position of the Respondent
20. According to the Respondent, the Claimant did not have a just cause to terminate the
Contract prematurely.
21. In particular, the Respondent supported its stance by stating that the Claimant agreed to
mutually terminate the Contract via the email correspondence sent on 10 June 2024,
thereby agreeing to waive any entitlement to compensation under the Contract.
22. The Respondent pointed to the Claimant’s bad faith in refusing to accept the amicable
terms that foresaw payment of more than EUR 100,000 than what he was actually owed,
which created a precarious financial situation for the Respondent.
23. The Respondent equally argued that the Claimant failed to provide a concrete grace period
in his default notice of 7 May 2024, which means that the unilateral termination of the
Contract is without effect.
24. The Respondent acknowledged that the Claimant stated in his letter of 11 June 2024 that,
if the payment of EUR 250,000 would not be made until 14 June 2024, the agreement would
be void and he would lodge a claim before FIFA. Notwithstanding, the Respondent
emphasised that this particular point was not expressly accepted by itself, thus not
affecting the allegedly mutually agreed upon terms concerning the premature termination.
25. In conclusion, the Respondent requested for the claim to be rejected.
pg. 6
REF. FPSD-xxxxx
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
26. First of all, the Dispute Resolution Chamber (hereinafter: the Chamber or DRC) analysed
whether it was competent to deal with the case at hand. In this respect, it took note that
the present matter was presented to FIFA on 19 June 2024 and submitted for decision on
23 September 2024. Taking into account the wording of art. 34 of the March 2023 edition
of the Procedural Rules Governing the Football Tribunal (hereinafter: the Procedural Rules),
the aforementioned edition of the Procedural Rules is applicable to the matter at hand.
27. Furthermore, the Chamber referred to art. 2 par. 1 of the Procedural Rules and observed
that in accordance with art. 23 par. 1 in combination with art. 22 par. 1 lit. b) of the
Regulations on the Status and Transfer of Players (June 2024 edition), 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 Country A player
and a Country B club.
28. Subsequently, 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 (June 2024 edition), and
considering that the present claim was lodged on 19 June 2024, the June 2024 edition of
said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the
substance.
b. Burden of proof
29. The Chamber recalled the basic principle of burden of proof, as stipulated in art. 13
par. 5 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. Likewise, the Chamber stressed
the wording of art. 13 par. 4 of the Procedural Rules, pursuant to which it may consider
evidence not filed by the parties, including without limitation the evidence generated by or
within the Transfer Matching System (TMS).
c. Merits of the dispute
30. Having established the competence and the applicable regulations, the Chamber entered
into the merits of the dispute. In this respect, the Chamber started by acknowledging all
the above-mentioned facts as well as the arguments and the documentation on file.
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
assessing the matter at hand.
pg. 7
REF. FPSD-xxxxx
i. Main legal discussion and considerations
31. The Chamber then moved to the substance of the matter, and took note of the fact that
the parties strongly dispute the premature termination of the Contract.
32. The Chamber recalled the parties respective lines of reasoning, with the Claimant on one
hand arguing that he had just cause to terminate the Contract due to overdue payables.
More specifically, the Claimant asserted that at least two monthly salaries remained
outstanding, despite a default notice and several amicable attempts at resolving the
dispute.
33. The Respondent, on the other hand, alleged that the parties mutually terminated the
Contract, and that the Claimant is requesting compensation in bad faith, disregarding the
terms of the alleged agreement. The non-payment of the amounts in dispute remained
uncontested by the Respondent.
34. In this context, the Chamber acknowledged that its task was to determine whether the
parties had indeed mutually terminated the Contract, subsequently, if not, whether the
Claimant had a just cause to unilaterally terminate the Contract as asserted, and lastly,
what the consequences of the above conclusions would be.
35. As for the mutual termination of the Contract, the Chamber firstly deemed it important to
recall the timeline of the parties around the alleged date of the mutual agreement – in
particular focusing on the exchange of correspondence between 10 June 2024 and
11 June 2024.
36. The Chamber noted that the Claimant sent a letter to the Respondent, proposing a
payment schedule in respect of the outstanding amounts due under the Contract, subject
to the condition that all amounts thereunder would be paid on time, and failing which, the
Contract would be considered terminated with just cause and the player would be
considered “free in 10 days”.
37. Equally, the Chamber observed that, in reply thereto, the Respondent had affirmed that it
agreed to these conditions.
38. Thereafter, it remained undisputed between the parties that the second instalment under
the proposal of 21 May 2024 had remained unpaid, whereafter the Claimant had sent
another warning letter on 10 June 2024.
39. The Chamber closely analysed the wording of said letter – in particular, the provision
stating that “If the club doesn’t pay only one payment deadline, the totality of the sums due
under the contract will be due, i.e., an amount of EUR 2,635,000 until 30 June 2026, less the
sums which have been paid under this agreement”.
pg. 8
REF. FPSD-xxxxx
40. One day after, the parties continued to exchange correspondence, with the Respondent
requesting to exclude said provision from the purported agreement, and the Claimant, in
turn, agreeing to exclude said provision, however, under the condition that if any payment
stipulated thereunder would not be remitted, the agreement would be considered null and
void and a claim before FIFA for compensation would be lodged.
41. Notably, the Chamber observed that the Claimant’s last correspondence in this respect, as
well as the subsequent reminder sent on 13 June 2024, remained unanswered by the
Respondent.
42. Having analysed the above exchanges, the Chamber considered that the parties never
came to a concrete mutual agreement, since the Respondent wished for the residual value
of the Contract not to become payable upon failure of adhering to the initial payment
schedule, whereas the Claimant considered that a crucial condition for the amicable
resolution of the dispute was the timely remittance of the relevant amounts, in particular
the payment of EUR 250,000 by no later than 14 June 2024 – which the Respondent never
formally agreed to.
43. Consequently, the Chamber was of the unanimous opinion that the parties did not find an
amicable resolution to their differences.
44. With this in mind, the Chamber proceeded to analyse the date of termination of the
Contract.
45. Whilst the Chamber noted that the Claimant sent a unilateral (and retroactive – with effect
as from 14 June 2024) termination notice on 26 June 2024, the present claim was lodged
on 19 June 2024.
46. The Chamber considered that the lodging of the present claim – in which compensation for
a breach of contract without just cause by the Respondent was requested – marked a point
of no return for the parties’ contractual relationship.
47. Consequently, the Chamber viewed the Contract as terminated de facto as from
19 June 2024.
48. Having set out the above, the Chamber continued to consider the lawfulness of the
contractual termination.
49. The Chamber, at this stage, once again wished to recall the timeline leading up to the
contractual termination. In particular, it took note of the fact that the Claimant had first
sent a default notice on 7 May 2024, granting no specific deadline, but merely quoting
art. 14bis RSTP in the letter.
pg. 9
REF. FPSD-xxxxx
50. Thereafter, the Claimant entered unfruitful negotiations with the Respondent, before
unilaterally terminating the Contract de facto on 19 June 2024.
51. As a result of the above, the Chamber was of the opinion that the formal requirements of
art. 14bis were not met in the case at hand, and that the lawfulness of the contractual
termination had to be assessed in accordance with art. 14 of the Regulations.
52. The Chamber deemed it appropriate to remind the parties that only a breach or
misconduct which is of a certain severity justifies the termination of a contract. In other
words, only when there are objective criteria which do not reasonably permit to expect the
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 to ensure the fulfilment of the contractual duties by the counterparty, 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.
53. At the time of terminating the Contract, it remained undisputed that, although the Claimant
was entitled to receive EUR 690,000, corresponding to 8 x EUR 85,000 – monthly salaries –
plus 8 x EUR 1,250 – accommodation allowance – between the signature of the Contract
and the date of termination, the Respondent only paid EUR 308,251.86 to the Claimant.
Therefore, the amount of EUR 381,748.14 remained outstanding.
54. The Chamber took note of the fact that the above amount corresponded to approximately
4-and-a-half salaries under the Contract.
55. Taking into account not only the considerable amount that was outstanding at the time of
termination, but equally the Claimant’s good faith in attempting to resolve the dispute
amicably, with seemingly limited reciprocal effort from the Respondent in this regard, the
Chamber unanimously reached the conclusion that the threshold of ultima ratio was met
in the case at hand.
56. Consequently, the Chamber established that the Claimant had a just cause to terminate
the Contract in accordance with art. 14 of the Regulations.
ii. Consequences
57. Having stated the above, the Chamber turned its attention to the question of the
consequences of such unjustified breach of contract committed by the Respondent.
58. The Chamber observed that the outstanding remuneration at the time of termination,
coupled with the specific requests for relief of the player, was equivalent to EUR 381,748.14.
59. As a consequence, and in accordance with the general legal principle of pacta sunt servanda,
the Chamber decided that the Respondent is liable to pay to the Claimant the amounts
pg. 10
REF. FPSD-xxxxx
which were outstanding under the contract at the moment of the termination, i.e.
EUR 381,748.14.
60. Having stated the above, the Chamber turned to the calculation of the amount of
compensation payable to the player by the club in the case at stake. In doing so, 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 player 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.
61. 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.
62. As a consequence, the members of the Chamber determined that the amount of
compensation payable by the club to the player 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 non-exhaustive enumeration of criteria to be taken into
consideration when calculating the amount of compensation payable.
63. Bearing in mind the foregoing as well as the claim of the player, the Chamber proceeded
with the calculation of the monies payable to the player under the terms of the contract
from the date of its unilateral termination until its end date. Consequently, the Chamber
concluded that the amount of EUR 2,197,500 (i.e. the residual value of the Contract) serves
as the basis for the determination of the amount of compensation for breach of contract,
based on the following calculation:
-
EUR 2,020,000 as salaries between June 2024 and June 2026;
-
EUR 150,000 as guaranteed seasonal bonus payments (or three times EUR 50,000
payable on 30 June of each respective season);
-
EUR 27,500 accommodation allowance (or two times EUR 1,250 for June 2024 plus
two times EUR 12,500 for the following two seasons).
64. In continuation, the Chamber verified as to whether the player 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
pg. 11
REF. FPSD-xxxxx
DRC as well as art. 17 par. 1 lit. ii) of the Regulations, 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.
65. Based on the evidence on file, the player remained unemployed following the contractual
termination.
66. The Chamber referred to art. 17 par. 1 lit. ii) of the Regulations, according to which, in case
the player did not sign any new contract following the termination of his previous contract,
as a general rule, the compensation shall be equal to the residual value of the contract that
was prematurely terminated.
67. Consequently, on account of all of the above-mentioned considerations and the
specificities of the case at hand, the Chamber decided that the club must pay the amount
of EUR 2,197,500 – i.e., the residual value of the Contract, which was to be considered a
reasonable and justified amount of compensation for breach of contract in the present
matter.
68. Lastly, taking into consideration the player’s request as well as the constant practice of the
Chamber in this regard, the latter decided to award the player no additional interest on the
above amounts, in particular in line with the general legal principle of ne iudex eat ultra
petita partium.
iii. Art. 17 par. 4 of the Regulations / Sporting sanctions
69. In continuation, the Chamber focused on the further consequences of the breach of
contract in question and, in this respect, it addressed the question of sporting sanctions
against the club in accordance with art. 17 par. 4 of the Regulations. The cited provision
stipulates that, in addition to the obligation to pay compensation, sporting sanctions shall
be imposed on any club found to be in breach of contract during the protected period.
70. In this respect, the Chamber referred to item 7 of the “Definitions” section of the
Regulations, which stipulates inter alia that the protected period shall last “for three entire
seasons or three years, whichever comes first, following the entry into force of a contract, where
such contract is concluded prior to the 28th birthday of the professional, or two entire seasons
or two years, whichever comes first, following the entry into force of a contract, where such
contract is concluded after the 28th birthday of the professional”.
71. In this respect, the Chamber took note that the player was born on 14 September 1995 and
the relevant contract with the club was concluded on 15 September 2023. Furthermore,
the Chamber Judge noted that the Claimant terminated the contract with cause on
19 June 2024. The breach of contract by the club had therefore occurred within the
protected period.
pg. 12
REF. FPSD-xxxxx
72. Moreover, the Chamber took note that the Respondent had already been held liable of
breaching other players’ contracts without just cause on several recent occasions, in
particular cases:
-
FPSD-XXXXX – notified to the parties on 8 December 2023;
FPSD-XXXXX – notified to the parties on 22 March 2024;
FPSD-XXXXX – notified to the parties on 4 April 2024.
73. Consequently, the Chamber decided that, by virtue of art. 17 par. 4 of the Regulations, the
club shall be sanctioned with a ban from registering any new players, either nationally or
internationally, for the next two entire and consecutive registration periods.
iv. Compliance with monetary decisions
74. Finally, taking into account the applicable Regulations, the Chamber referred to art. 24 par.
1 and 2 of the Regulations, which stipulate that, with its decision, the pertinent FIFA
deciding body shall also rule on the consequences deriving from the failure of the
concerned party to pay the relevant amounts of outstanding remuneration and/or
compensation in due time.
75. In this regard, the DRC highlighted that, against clubs, the consequence of the failure to
pay the relevant amounts in due time shall consist of a ban from registering any new
players, either nationally or internationally, up until the due amounts are paid. The overall
maximum duration of the registration ban shall be of up to three entire and consecutive
registration periods.
76. Notwithstanding the above, the DRC wished to remark that in accordance with art. 24 par.
3 of the Regulations, the aforementioned consequences may be excluded where the
pertinent FIFA deciding body has already imposed on the same party a sporting sanction
on the basis of article 12bis, 17 or 18quater of the Regulations.
77. In this respect, considering that art. 17 par. 4 of the Regulations applies in the matter, the
Chamber established that art. 24 par. 2 of the Regulations shall not apply, insofar as in case
the Respondent fails to comply with the decision at hand, the application of a further ban
from registering any new players on top of the one already being served by the Respondent
would be moot and against the spirit of the Regulations, in particularly the enforcement
mechanism established under art. 24 of the Regulations.
78. In view of the above, the DRC decided that, if the aforementioned sum plus interest is not
paid within 45 days of notification of this decision, the present matter shall be submitted,
upon request of the Claimant, to the FIFA Disciplinary Committee for its consideration and
formal decision.
pg. 13
REF. FPSD-xxxxx
79. The Respondent shall make full payment (including all appliable interest) to the bank
account provided by the Claimant in the Bank Account Registration Form, a copy of which
is available in the present file on the FIFA Legal Portal.
d. Costs
80. The Chamber referred to art. 25 par. 1 of the Procedural Rules, according to which
“Procedures are free of charge where at least one of the parties is a player, coach, football agent,
or match agent”. Accordingly, the Chamber decided that no procedural costs were to be
imposed on the parties.
81. Likewise, and for the sake of completeness, the Chamber recalled the contents of art. 25
par. 8 of the Procedural Rules and decided that no procedural compensation shall be
awarded in these proceedings.
82. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made
by any of the parties.
pg. 14
REF. FPSD-xxxxx
IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, Player A, is partially accepted.
2.
The Respondent, Club B, must pay to the Claimant the following amount(s):
- EUR 381,748.14 as outstanding remuneration;
- EUR 2,197,500 as compensation for breach of contract.
3.
Any further claims of the Claimant are rejected.
4.
Full payment (including all applicable interest) shall be made to the bank account indicated
in the enclosed Bank Account Registration Form.
5.
The Respondent shall be banned from registering any new players, either nationally or
internationally, for the two next entire and consecutive registration periods following the
notification of the present decision.
6.
If full payment (including all applicable interest) is not made within 30 days of notification
of this decision, the present matter shall be submitted, upon request of the Claimant, to
the FIFA Disciplinary Committee.
7.
This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
pg. 15
REF. FPSD-xxxxx
NOTE RELATED TO THE APPEAL PROCEDURE:
According to article 57 par. 1 of the FIFA Statutes, this decision may be appealed against before
the Court of Arbitration for Sport (CAS) within 21 days of receipt of the notification of this
decision.
NOTE RELATED TO THE PUBLICATION:
FIFA may publish this decision. For reasons of confidentiality, FIFA may decide, at the request
of a party within five days of the notification of the motivated decision, to publish an
anonymised or a redacted version (cf. article 17 of the Procedural Rules Governing the Football
Tribunal).
CONTACT INFORMATION
Fédération Internationale de Football Association – Legal & Compliance Division
396 Alhambra Circle, 6th floor, Coral Gables, Miami, Florida, USA 33134
legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
pg. 16