Labour Disputes
Texto da decisão
Decis ion of the
Dis pute Res olution Cham ber
passed in Zurich, Switzerland, on 25 October 2018,
in the following composition:
Geoff Thom ps on (England), Chairman
S tefano La Porta (Italy ), member
Muzam m il Bin Moham ed (S ingapore), member
Tom is lav Kas alo (Croatia), member
Joaquim Ev angelis ta (Portugal), member
on the claim presented by the player,
Play er A, Country B
as Claimant
against the club,
Club C, Country D
as Respondent
regarding an employment-related dispute
arisen between the parties
I.
Facts of the cas e
1.
On 3 February 2016, the Player of Country B, Player A (hereinafter: the
Claimant), and the Club of Country D, Club C (hereinafter: the Respondent),
signed an employment contract valid as from 4 February 2016 until 31
December 2018.
2.
According to art. 15 of the employment contract, the Claimant was entitled,
inter alia, to:
a. a monthly salary of 1,670,000 as from 4 February until 31 December 2016;
b. a monthly salary of 1,850,000 as from 1 January until 31 December 2017;
c. a monthly salary of 2,100,000 as from 1 January until 31 December 2018.
3.
According to art. 16 of the employment contract, the Claimant’s salary had to
be paid “until the 10th day of the month by bank transfer or in cash”.
4.
Furthermore, art. 45 of the employment contract provides that, in case the
Respondent terminates the contract without notice, the Claimant “shall be
entitled to absentee pay due for twelve months, or if the time remaining
from the fixed period is less than one year, for the remaining time period”.
5.
Moreover, according to art. 50 of the employment contract, “[the Claimant]
accepts that if – considering Section 8.1) as well – he fails to get into [the
Respondent]’s first team or if he, based on the professional staff’s decision, is
transferred to [the Respondent]’s second or other team, his base wage
established in the present employment contract shall be reduced by 50%
from the first day of the month following the decision”.
6.
By letter dated 19 January 2017, the Respondent informed the Claimant that
“according to [his] working contract’s 50. point, based on the professional
staff’s decision, [he was] transferred to Club C’s second team from the start of
the preparation of the spring season 2017 (10 January 2017)” and that
“according to the contract’s point” his wage had been reduced by 50%.
7.
On 24 April 2017, the Claimant addressed the Respondent in writing asking:
(i) to be “immediately included in the first team trainings and matches”, (ii)
to be paid 925,000 each for the months of February and March 2017, “plus
interest” as of, respectively, 11 March and 11 April 2017 and (iii) to be paid as
stipulated in art. 15 of the employment contract for the upcoming months
and seasons. With the same correspondence, the Claimant formally requested
the Respondent to withdraw its decision of 19 January 2017.
Player A, Country B / Club C, Country D
2/12
8.
By a further letter addressed to the Respondent on 13 July 2017, the Claimant
reiterated the requests expressed with his previous correspondence and put
the Respondent in default of 925,000 each for the months of February,
March, April, May and June 2017, plus the corresponding interests,
requesting that the Respondent fulfil said obligations within 30 days.
9.
In reply to said correspondence, on 14 July 2017, the Respondent informed
the Claimant that, “pursuant to point 50 of the employment contract, the
[Respondent] has the right to move the [Claimant] to the 2nd team, which
the [Claimant] accepted with signing the contract”. With said
correspondence, the Respondent added that the decision had been taken by
the “professional staff”, which “evaluated the [Claimant]’s performance and
attitudes weekly”.
10.
By letter dated 14 August 2017, the Claimant informed the Respondent that
he was terminating the employment contract with just cause “due to the
fundamental breach of the Contract by the [Respondent]”.
11.
On 5 March 2018, the Claimant lodged a claim against the Respondent in
front of FIFA maintaining that he had just cause to terminate the contract
and requesting to be awarded the total amount of 40,000,000, consisting of:
a. 5,550,000 “for the remaining wages” as from February until July 2017,
plus 5% interest p.a. on 925,000 for each of those months, to be
calculated as of the 11th day of each month from March until August
2017;
b. 34,450,000 as compensation for breach of contract, corresponding to its
residual value, plus interest “as of 15 August 2017 until the payday”.
12.
More in particular, the Claimant argued that, on 10 January 2017, the
Respondent’s officials had told him that the Respondent was not counting on
his services anymore and instructed him to continue training with its second
team. The Claimant added that, 10 days later, the Respondent formally
informed him that he had been transferred to the second team and that his
wage had been reduced by 50%.
13.
Furthermore, the Claimant explained that he followed the Respondent’s
decision and kept training with its second team, receiving 50% of the salary
established in his contract as of February 2017, while hoping to be moved
back to the Respondent’s first team.
14.
The Claimant added that the Respondent ordered him to immediately return
the official car and to stop attending the first team lunches and using the
main pitch at the Respondent’s premises.
Player A, Country B / Club C, Country D
3/12
15.
Moreover, the Claimant pointed out that the Respondent had ignored all his
requests addressed in January 2017 after it had taken the decision to move
him to the second team and that it had ignored his letter of 24 April 2017 to
be put back with the first team. The Claimant recalled that the Respondent
only replied to his correspondence of 13 July 2017, informing him that the
contested decision was taken in accordance with art. 50 of the employment
contract.
16.
The Claimant further explained that, after his letter of 13 July 2017, he had
been put under “enormous and constant pressure from various
representatives of the [Respondent]” and that, eventually, he had been
transferred to the under 19 squad which, at the time, allegedly competed at
amateur level in the “fourth tier of Football in Country D”. The Claimant
added that, subsequently, he had been told by the Respondent that there
would be no second team in the upcoming season and that there was no way
that he would ever be moved back to the first team.
17.
The Claimant argued that, in this context, and given that he had not played a
single minute with the first team for more than 8 months and received 50%
of his salaries for more than 6 months, he had just cause to terminate his
contract on 14 August 2017.
18.
In its reply, the Respondent asked that the claim be rejected in its entirety.
19.
More in particular, the Respondent acknowledged that it had moved the
Claimant to the second team and that his salary had been reduced by 50%,
but argued that it was entitled to do so in accordance with art. 50 of the
employment contract.
20.
Moreover, the Respondent recalled Appendix 6 of the Regulations of the
Football Federation of Country D (hereinafter: Football Federation E) on the
Status and Transfer of Players and pointed out that, under their Section 47 of
chapter XI, there is a paragraph of the same tenor as art. 50 of the
employment contract. Moreover, the Respondent added that said regulations
apply on a compulsory basis and that, therefore, art. 50 of the employment
contract is lawful and, consequently, so is the decision to move the Claimant
to the second team and reduce his salary.
21.
Furthermore, the Respondent underlined that the decision to move the
Claimant to the second team was due to his physical conditions, which were
“not appropriate” for the first team of a professional club. However, the
Respondent pointed out that, pursuant to art. 50 of the employment
contract, it was entitled to take such decision unconditionally.
Player A, Country B / Club C, Country D
4/12
22.
The Respondent further highlighted that the Claimant kept having access to
the same facilities, training pitches and doctors of the first team and that the
second team’s players are not amateurs but professionals. Consequently,
according to the Respondent, the Claimant had not suffered any detriment
by having been moved to the second team.
23.
Subsidiarily, the Respondent asked FIFA to take into account the
remuneration the Claimant received from the employment contracts he
signed with his new clubs, should the DRC decide that he is entitled to
compensation for breach of contract.
24.
In his replica, the Claimant reiterated his position and added that art. 50 of
the employment contract is unlawful and contrary to the FIFA Regulations,
being of potestative nature. The Claimant further pointed out that his
physical conditions were appropriate and that he had never been addressed
by the Respondent in that regard.
25.
In its duplica, the Respondent entirely reiterated the position expressed in its
reply to the claim and added that all Clubs in Country D have to apply art. 50
of the employment contract. In this respect, the Respondent submitted a
statement from Manager F, Football Federation E’s TMS manager, declaring
that “all the Clubs in Country D have an obligation to use the professional
contract sample”.
26.
The Claimant informed FIFA that, on 30 August 2017, he signed a contract
with the Club of Country G, Club H, valid as from the date of signature until
31 May 2018, for a monthly salary of EUR 1,000. The Claimant added that, on
8 November 2017, he amicably terminated said contract, recognising that the
club owed him EUR 3,000. Furthermore, the Claimant informed that, as from
19 January 2018 until 19 May 2018, he was registered as an amateur with the
Club of Country B, Club J, and received no remuneration. Lastly, the Claimant
informed that, on 4 July 2018, he signed a contract with the Club of Country
B, Club K, valid as from 21 June 2018 until 21 June 2020. Pursuant to said
contract, the Claimant was entitled to a signing-on fee of 21,500, to be paid
as follows: 2,500 at signing and the rest “in monthly instalments in the
amount of 1,500 by the beginning of the second (spring) part of the season,
when the amount of 4,000 shall be paid”. The contract specifies that “the
payment of the fee continues to be made in monthly instalments until the
whole amount is paid”. Moreover, according to the contract, the Claimant
was entitled to a monthly salary of gross 796.02.
Player A, Country B / Club C, Country D
5/12
II.
Cons iderations of the Dis pute Res olution Cham ber
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 stake. In this respect, the DRC took note that the present matter was
submitted to FIFA on 5 March 2018. Consequently, the DRC concluded that
the 2018 edition of the Rules Governing the Procedures of the Players’ Status
Committee and the Dispute Resolution Chamber (hereinafter: the Procedural
Rules) is 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 2018), the DRC is competent to deal with the matter at
stake, which concerns an employment–related dispute with an international
dimension between a Player of Country B and a Club of Country D.
3.
Furthermore, the DRC analysed which edition of the Regulations on the
Status and Transfer of Players should be applicable as to the substance of the
matter. In this respect, the DRC confirmed that in accordance with art. 26 par.
1 and par. 2 of the said Regulations (edition 2018) and considering that the
present claim was lodged in front of FIFA on 5 March 2018, the 2018 edition
of the Regulations on the Status and Transfer of Players (hereinafter: the
Regulations) is applicable to the matter at hand as to the substance.
4.
The competence of the DRC and the applicable regulations having been
established, the members of the Chamber entered into the substance of the
matter. In this respect, the Chamber started by acknowledging all the abovementioned 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 this respect, the DRC acknowledged that, on 3 February 2016, the Claimant
and the Respondent concluded an employment contract valid as from 4
February 2016 until 31 December 2018, pursuant to which the Claimant was
entitled to, inter alia, a monthly salary of 1,670,000 for the first contractual
year, a monthly salary of 1,850,000 for the second and a monthly salary of
2,100,000 for the third.
6.
In continuation, the members of the Chamber observed that, according to
the Claimant, he had just cause to unilaterally terminate the employment
contract on 14 August 2017, due to the fact that, following its decision of 19
January 2017 to relegate him to the second team, by the time he terminated
the employment contract, the Respondent had only paid half of his salary for
Player A, Country B / Club C, Country D
6/12
6 consecutive months, alleging it was entitled to do so on the ground of art.
50 of the employment contract.
7.
In continuation, the members of the Chamber noted that the Respondent, for
its part, did not contest the recollection of the events made by the Claimant.
However, the DRC took note that the Respondent deemed that its decision to
relegate the Claimant to the second team and, most importantly, to halve his
monthly salary was justified in light of the aforementioned contractual
provision.
8.
On account of the above, the Chamber highlighted that the underlying issue
in this dispute was to determine as to whether the employment contract had
been terminated by the Claimant with just cause and, subsequently, to
determine the consequences thereof.
9.
Moreover, the members of the Chamber observed that, in light of the
circumstances of the case and considering the disagreement of the parties on
the point, the core of the decision revolved around the question as to
whether the Respondent could lawfully decrease the Claimant’s salary on the
basis of art. 50 of the employment contract.
10.
Having said that, the members of the Chamber turned their attention to the
contractual clause at stake and deemed it worthwhile to recall its tenor,
according to which: “[the Claimant] accepts that if – considering Section 8.1)
as well – he fails to get into [the Respondent]’s first team or if he, based on
the professional staff’s decision, is transferred to [the Respondent]’s second
or other team, his base wage established in the present employment contract
shall be reduced by 50% from the first day of the month following the
decision”.
11.
In respect of the foregoing, the members of the DRC thought worth it to
mention, as a preliminary remark, that nowhere in the employment contract
“Section 8.1” the clause refers to is to be found. Without any additional
clarifications in the parties’ submissions, the Chamber concluded that the
clause refers to Section 8 of Country D’s Act I of 2004 on Sports, which is
recalled, however without further specifications, in the preamble of the
employment contract.
12.
Having clarified that, the members of the Chamber noticed, first and
foremost, that the clause had a clear non-reciprocal character, as it
established a right solely in favour of the Respondent, inevitably giving rise
to an unbalanced employment relationship between the parties. More in
particular, the DRC underlined that said clause had the effect to arbitrarily
modify the main element characterising any labour relationship, i.e. the
obligation for one party to render his services towards the other party in turn
of a contractually agreed remuneration, in the part in which it allowed the
Respondent to curtail the Claimant’s salary at its own discretion.
Player A, Country B / Club C, Country D
7/12
13.
In this respect, the Chamber referred to its well-established jurisprudence and
emphasised that a player cannot be made object of a severe financial
measure for alleged poor performance or, as in the case at stake, for a
physical condition considered “not appropriate”, as this is a purely unilateral
and subjective evaluation by the club. Thus, the Chamber stressed that poor
or unsatisfactory performance of any kind cannot, by any means, be
considered as a valid reason to reduce a player’s salary.
14.
The members of the Chamber deemed it important to underline that the
foregoing line of reasoning holds a fortiori against the Respondent’s
argument that the contractual provision under scrutiny allowed it to take the
decision to halve the Claimant’s salary in a totally uncondional fashion,
regardless of any evaluation of his physical conditions.
15.
The DRC further recalled that, according to the Respondent, Football in
Country D clubs have to apply art. 50 of the employment contract, given that
they allegedly “have an obligation to use the professional contract sample”.
However, the DRC was eager to emphasise that the fact that said clause is
somehow considered common practice in Football in Country D, or even
reflected in Football Federation E standard contracts, cannot make up for its
fundamental unfairness.
16.
On account of the aforementioned considerations, the Chamber was of the
unanimous opinion that said clause had to be disregarded in the part in
which it allowed the Respondent to curtail the Claimant’s salary and, thus,
rejected the Respondent’s main argument concerning the contractual
legitimacy of its stance.
17.
Having established the above, the members of the DRC turned their attention
to the consequences of the Respondent’s decision of 19 January 2017 and
observed that it remained uncontested that the Claimant received only half
of his salary for 6 consecutive months.
18.
As a result, the Chamber concluded that at the time the Claimant terminated
the employment contract, the total amount of 5,550,000 was outstanding,
corresponding to the remaining half of his salaries of February, March, April,
May, June and July 2017. Therefore, the members of the Chamber considered
that the Respondent had seriously neglected its contractual obligations
towards the Claimant in a continuous and repeated manner, reason for which
the latter had a just cause to terminate the contract on 14 August 2017,
having previously put the Respondent in default of its financial obligations
on 24 April 2017 and on 13 July 2017.
19.
Consequently, the Chamber decided that the Respondent is to be held liable
for the early termination of the employment contract with just cause by the
Claimant.
Player A, Country B / Club C, Country D
8/12
20.
In continuation, prior to establishing the consequences of the termination of
the employment contract with just cause by the Claimant, the Chamber
decided that the Respondent must fulfil its obligations as per the
employment contract in accordance with the general legal principle of “pacta
sunt servanda”. Consequently, the Chamber decided that the Respondent is
liable to pay to the Claimant 5,550,000, pertaining to the second half of each
of his salaries as from February 2017 until July 2017.
21.
In addition, taking into consideration the Claimant’s claim, the Chamber
decided to award the Claimant interest at the rate of 5% p.a. as of the day
following the day on which each instalment fell due in accordance with the
employment contract until the date of effective payment.
22.
In continuation and having established that the Respondent is to be held
liable for the early termination of the employment contract with just cause
by the Claimant, the Chamber decided that, taking into consideration art.17
par. 1 of the Regulations, the Claimant is entitled to receive from the
Respondent compensation for breach of contract in addition to the
aforementioned outstanding remuneration.
23.
In this context, the Chamber outlined that in accordance with said provision
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 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 whether the pertinent employment contract contained any
clause, by means of which the parties had beforehand agreed upon a
compensation payable by the contractual parties in the event of breach of
contract. In this regard, the Chamber observed that the matter at stake falls
outside of the scope of the only clause contained in the employment contract
concerning its unilateral premature termination.
25.
As a consequence, the members of the Chamber 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. Bearing in mind the foregoing, the Chamber proceeded with the
calculation of the monies payable to the Claimant under the terms of the
employment contract as from its termination and concluded that the
Claimant would have been entitled to receive 34,450,000 as remuneration
had the employment contract been executed until its regular expiry date, i.e.
31 December 2018.
Player A, Country B / Club C, Country D
9/12
26.
In continuation, the Chamber assessed 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(s) 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.
27.
In respect of the above, the Chamber recalled that the Claimant signed a
number of employment contracts following the termination of the one at
stake. More specifically, the Chamber recalled that, on 30 August 2017, the
Claimant signed a contract with the Club of Country G Club H, valid as from
the date of signature until 31 May 2018, for a monthly salary of EUR 1,000,
which had been amicably terminated on 8 November 2017.
28.
In this regard, the members of the Chamber deemed it important to point
out that, by voluntarily agreeing to the early termination of his new
employment contract with Club H on 8 November 2017, the Claimant had
actually freely renounced to receive the income relating to the period of time
between 8 November 2017 and 31 May 2018. Consequently, and in light of
the above described circumstances, the Chamber concurred that the
employment contract with Club H shall be taken into consideration in its full
length in the calculation of the amount of compensation for breach of
contract in the case at hand.
29.
Moreover, the Chamber observed that, as from 19 January 2018 until 19 May
2018, the Claimant was registered as an amateur with the Club of Country B,
Club J, and received no remuneration. The Chamber further took note that,
on 4 July 2018, the Claimant signed a contract with the Club of Country B,
Club K, valid as from 21 June 2018 until 21 June 2020.
30.
The Chamber recalled that, pursuant to this last contract, the Claimant was
entitled to a signing-on fee of 21,500, to be paid as follows: 2,500 at signing
and the rest “in monthly instalments in the amount of 1,500 by the
beginning of the second (spring) part of the season, when the amount of
4,000 shall be paid”. Furthermore, the members of the Chamber observed
that said contract specified that “the payment of the fee continues to be
made in monthly instalments until the whole amount is paid” and that the
Claimant was entitled to a monthly salary of gross 796.02. However, the
members of the DRC took into account the fact that the Claimant declared
that, from the beginning of the relationship, he received the monthly
instalments of the signing-on fee together with his salary.
Player A, Country B / Club C, Country D
10/12
31.
Consequently, on account of all of the above-mentioned considerations, the
specificities of the case at hand as well as the Claimant’s general obligation to
mitigate his damage, the Chamber decided that the Respondent must pay the
amount of 29,027,610 to the Claimant as compensation for breach of
contract.
32.
In addition, taking into account the Claimant’s request as well as the constant
practice of the Dispute Resolution Chamber in this regard, the Chamber
decided that the Respondent must pay to the Claimant interest of 5% p.a. on
the amount of compensation as of the date on which the claim was lodged,
i.e. 5 March 2018, until the date of effective payment.
33.
The Chamber concluded its deliberations in the present matter by rejecting
any further claim of the Claimant.
III. Decis ion of the Dis pute Res olution Cham ber
1.
The claim of the Claimant, Player A, is partially accepted.
2.
The Respondent, Club C, has to pay to the Claimant, w ithin 30 day s as from
the date of notification of this decision, outstanding remuneration in the
amount of 5,550,000, plus 5% interest p.a. as follows:
a. on 925,000 as from 11 March 2017 until the date of effective payment;
b. on 925,000 as from 11 April 2017 until the date of effective payment;
c. on 925,000 as from 11 May 2017 until the date of effective payment;
d. on 925,000 as from 11 June 2017 until the date of effective payment;
e. on 925,000 as from 11 July 2017 until the date of effective payment;
f. on 925,000 as from 11 August 2017 until the date of effective payment.
3.
The Respondent has to pay to the Claimant, w ithin 30 day s as from the date
of notification of this decision, compensation for breach of contract in the
amount of 29,027,610, plus 5% interest p.a. as from 5 March 2018 until the
date of effective payment.
Player A, Country B / Club C, Country D
11/12
4.
In the event that the amounts plus interest due to the Claimant in accordance
with the above-mentioned numbers 2. and 3. are not paid by the Respondent
within the stated time limits, the present matter shall be submitted, upon
request, to the FIFA Disciplinary Committee for consideration and a formal
decision.
5.
Any further claim lodged by the Claimant is rejected.
6.
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 Dispute Resolution Chamber of every payment received.
*****
Note relating to the m otiv ated decis ion (legal remedy):
According to art. 58 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 (CAS)
Avenue de Beaumont 2
CH-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:
Omar Ongaro
Football Regulatory Director
Encl.: CAS directives
Player A, Country B / Club C, Country D
12/12