Labour Disputes
Texto da decisão
Decis ion of the
Dis pute Res olution Cham ber
passed on 4 June 2020,
in the following composition:
Clifford Hendel (USA/France), Deputy Chairman
Elv is Chetty (S eychelles ), member
Tom is lav Kas alo (Croatia), member
on the claim lodged by the player,
Mr Jeon Hy os eok, Korea Republic,
represented by Messrs Menno Teunissen and Thomas Spee
as Claimant
against the club,
Perak Football Ass ociation, Malaysia
as Respondent
regarding an employment-related dispute
between the parties
I.
Facts of the cas e
Contractual basis
1.
On 5 December 2019, the club, Perak Football Association (hereinafter: the club or
the Respondent) offered the player, Jeon Hyoseok (hereinafter: the player or the
Claimant) a contract of employment as professional football player (hereinafter:
letter of offer).
2.
The letter of offer stipulated the following:
“2. On behalf of Football Association of Perak Darul Ridzuan (PAFA), I am delighted
to offer the Player a contract as a Professional Football Player representing PAFA
Football Team in the Malaysia Super League upon the terms and conditions herein
contained.
3. The offer is conditional subject to compliance of the following terms:
3.1. The Player has passed the Medical Examination and Fitness Test conducted
by Medical and Fitness Specialist in Malaysia approved by PAFA including Field
Trials. […]”
“4. The Medical Examination and Fitness Test shall be conducted in Malaysia within
fourteen (14) days form the date hereof.”
“6. The basic terms of the offer of contract are as follows:
6.1 Tenure:
First Year 2020. One (1) year from 16th December 2019 to 30th November 2020
subject to an agreed extension period or an early termination of contract.”
“6.2.1 Salary 2020:
First Year 2020. USD 10,000 (USD Ten Thousand) Only per month subject to
deduction of Advanced Salary.”
[…]
6.3 Advanced Salary:
USD 20,000 (USD Twenty Thousand) Only payable upon receipt of the Player’s
International Transfer Certificate (ITC).
[…]
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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6.5 Agent Fees:
USD 10,000 (USD Ten Thousand) Only payable upon receipt of the Player’s
International Transfer Certificate (ITC).
[…]
6.6.1 Accomodation:
A fully Furnished House / Apartment will be provided.
6.6.2 Car:
A car will be provided.
6.6.3 Flight Tickets:
Flight tickets economy class for the Player from hometown at the beginning of each
season and flight tickets economy class to hometown at the end of each season for
the Player.”
“7.7 PAFA has the absolute right to terminate the Player’s Contract on the grounds
of poor performance and commitment by the Player during training and matches
with a written notice despite the Provision of Article 4, Article 5 and Article 8 of the
Player’s Contract and with a full and final compensation of one (1) month salary
payable to the Player upon termination”.
3.
On an unspecified date, the player accepted the offer by sending the club a “letter
of acceptance”.
Overview of the case
4.
On an unspecified date, the Respondent sent the Claimant an unsigned copy of the
employment contract (hereinafter: the contract) which was signed by the player on
13 December 2019.
5.
The contract included all the elements of the letter of offer, however, specifying in
more details the following:
“SCHEDULE D – SPECIAL TERMS AND CONDITIONS
The special terms and conditions that have been agreed by the Club and the Player
without prejudice to and which shall prevail over other terms and conditions of the
Contract:
a). This Contract is conditional subject to compliance of the following terms:
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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i) The Player has passed the Medical Examination and Fitness Test conducted
by Medical and Fitness Specialist in Malaysia approved by the Club including
Field Trials prior to commencement of Season 2020.
ii) The Player has produced the latest Medical Records which shows the Player
does not have any serious previous injury.
iii) The Club may request the Player to undergo further Medical Examination
and Fitness Test at any time the Club thinks fit and necessary.
iv) The Player shall not have any current contract with other employer/ club
and if so, the Player has produced a copy of current Player’s Contract and a
Release Letter by the current employer/ club.
b) In the event that the Player shall fail to comply with any of the conditional terms
as stated above then the Club shall have absolute right to immediately terminate
this Contract without any compensation to the Player or to the Agent.
[…]
k) The Club has the absolute right to terminate this Contract without any
compensation the Player or to the Agent by a seven (7) days written notice despite
the provision of Article 4, Article 5 and Article 8 of this Contract if it is found any of
the followings:
i) The player continues with the committed Indiscipline Actions after being
served the Second Notice under Clause (j) above.
ii) The Player has an injury which disables the player to play for three (3)
consecutive months.
iii) The Player had previous injury which was not revealed to the Club upon
signing of the player’s Contract.
iv) The Player breach of any of the terms and conditions of the Contract.
v) The Player breaches any rules and regulations of the Club, FAM, FIFA and
other relevant authorities including the laws of Malaysia.”
6.
On 13 January 2020, the Respondent informed the Claimant about the termination
of the employment relationship. By means of said letter, the club sustained that the
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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player had “failed the Medical Examination and Fitness Test which was conducted
twice on 13th December 2019 and 7th January 2020 due to your injury stated in the
Medical Report”.
7.
Furthermore, the club indicated the following: “we hereby revoke the Letter of
Offer”.
Positions of the parties
8.
On 17 February 2020, the player lodged a claim in front of FIFA requesting the
following:
“- Find that Perak FA has breached the employment contract and terminated the
contract of Mr. Jeon Hyoseok without just cause;
9.
-
To Order Perak FA to pay Mr Jeon Hyoseok the sum of 172.500,00 USD net of all
taxes;
-
Find that the breach of employment by Perak FA had an egregious nature and
order Perak FA to pay an additional compensation of 30.000,00 USD.
-
In accordance with Article 17 para 4 of the RSTP, 2019 edition, ban the club from
registering any new player, either nationally or internationally, for 2 entire and
consecutive registration periods.
-
To award interest calculated at 5% p.a. on the amount requested for payment
arrears from the day the payment was due, until the day these sums are effectivel
paid;
-
To award interests calculated at 5% p.a. on the amount requested for
compensation from the day current claim was lodged, until the day the sums are
effectively paid;
-
Order the Claimant to bear the legal fees and costs incurred by the Respondent
in relation to this matter.”
In his claim, the player specified that he is entitled to the following amounts:
- Singing fee: USD 20,000
- 12 months’ salary in the total amount of USD 120,000
- Agent fee: USD 10,000
- Transport and housing: USD 12,000
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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-
Flight tickets: USD 1,500.
10.
Furthermore, the Claimant maintained that the Respondent violated art. 14 RSTP
and terminated his contract without just cause.
11.
In this context, the Claimant further maintained that “a player’s contract cannot be
terminated based on the circumstance that the player was injured, most notably
where such injury was sustained in the course of offering his services to the club”.
12.
In its reply, the club rejected the player’s claim. It deemed that the contract was only
conditional upon a successful medical examination.
13.
In this respect, the club argued that the player explicitly agreed to that by signing
the “letter of offer” and the employment contract, which the club pointed out, was
only signed by the player and given to him upon his request and because the club
“believed that the player was medically fit and had the ability”.
14.
In this context, the club argued that the player did not pass his medical examination
and therefore, “the club had no other option but to revoke the decision to offer the
Player’s Contract to the player”.
15.
Moreover, the club claimed that in accordance with art. 7.7 of the letter of offer
and Schedule D of the contract, the club had the right to terminate the contract
without any compensation to the Player or Agent.
16.
Finally, the club deemed that it provided the player with a flight ticket to Malaysia,
“accommodation and transport”
17.
Upon being requested to do so, the player informed FIFA that on 24 February 2020,
he signed an employment contract with the South Korean club, Chuncheon Citizen
FC, valid as from 24 February 2020 until 30 November 2020, according to which the
player was entitled to, inter alia, KRW (South-Korean Won) 1,700,000 per month
(approx. USD 1,426)
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 case at hand. In this
respect, it took note that the present matter was submitted to FIFA on 17 February
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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2020. Taking into account the wording of art. 21 of the 2019 edition of the Rules
Governing the Procedures of the Players’ Status Committee and the Dispute
Resolution Chamber (hereinafter: the Procedural Rules), the aforementioned
edition of the Procedural Rules is applicable to the matter at hand (cf. article 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
March 2020), 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 South Korean player and a Malaysian club.
3.
Furthermore, the Chamber analysed which regulations should be applicable as to
the substance of the matter. In this respect, the Chamber confirmed that in
accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer
of Players (edition March 2020), and considering that the claim was lodged on 17
February 2020, the January 2020 edition of the aforementioned regulations
(hereinafter: the Regulations) is applicable to the matter at hand as to the
substance.
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. In particular, the Chamber recalled that, in
accordance with art. 6 par. 3 of Annex 3 of the Regulations, FIFA may use, within
the scope of proceedings pertaining to the application of the Regulations, any
documentation or evidence generated or contained in the TMS.
5.
Having said this, the Chamber proceeded with an analysis of the circumstances
surrounding the present matter, the parties’ arguments as well the documentation
on file, bearing in mind art. 12 par. 3 of the Procedural Rules, in accordance with
which any party claiming a right on the basis of an alleged fact shall carry the burden
of proof.
6.
First of all, the members of the Chamber acknowledged that, on 5 December 2019,
the player and the club had signed the letter of offer, according to which the player
was offered a contract valid as from 16 December 2019 until 30 November 2020,
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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pursuant to which the club undertook to pay to the player the remuneration, as
established in point I.2. above.
7.
Furthermore, the members of the DRC took note of the fact that, on an unspecified
date, the club provided the player with an unsigned copy of an employment
contract which the player signed on 13 December 2019.
8.
In addition, the Chamber observed that on 13 January 2020 the club revoked the
letter of offer due to the player’s failed medical examination.
9.
Moreover, the DRC took note that, according to the player, the club terminated the
contract without just cause.
10.
Subsequently, the members of the DRC took note that the club, for its part,
acknowledged that it provided the player with the letter of offer and an unsigned
copy of the employment contract, however, according to both documents the
employment relationship was conditional upon a successful medical examination.
11.
Moreover, the Chamber acknowledged the Respondent’s arguments that in
accordance with art. 7.7 of the letter of offer and Schedule D of the contract, the
Respondent had the right to terminate the contract without any compensation to
the Player or Agent.
12.
In view of the aforementioned considerations, the members of the Chamber
highlighted that the underlying issue in this dispute, considering the diverging
position of the parties, was to determine whether the parties entered into a valid
and binding contract and, in the affirmative, if the Respondent had just cause to
terminate such contract on 13 January 2020.
13.
In this regard, the Chamber began to analyse whether a legally binding employment
contract had actually been concluded by and between the Claimant and the
Respondent.
14.
In this respect, the Chamber recalled that, in order for an employment contract to
be considered as valid and binding, apart from the signature of both the employer
and the employee, it should contain the essentialia negotii of an employment
contract, such as the parties to the contract and their role, the duration of the
employment relationship, the remuneration and the signature of both parties. After
a careful study of the contract signed between the parties, the Chamber concluded
that all such essential elements are included in the pertinent document, in
particular, the fact that the contract establishes that the Claimant is entitled to
receive remuneration in exchange for his services to the Respondent as a player.
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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15.
In that context, the Chamber was eager to refer to art. 18 par. 4 of the Regulations,
which stipulates that “the validity of a contract may not be made subject to a
positive medical examination and/or the granting of a work permit”.
16.
On account of all of the above, the members of the Chamber concluded that, by
having signed the letter of offer containing all the essentialia negotii, the parties
indeed established between them a valid and binding employment contract and are,
therefore, bound by the terms of the contract concluded between them.
17.
Having established that a valid and legally binding employment contract had been
in force between the Claimant and the Respondent, the Chamber went on to
analyse whether the Respondent terminated the contract on 13 January 2020, with
or without just cause.
18.
In this regard, the Chamber recalled that the Respondent argued that the player
failed the Medical Examination and that even if an employment was validly
concluded, the Respondent would have been entitled to terminate the contract in
accordance with art. 7.7 of the letter of offer, which stipulates that “PAFA has the
absolute right to terminate the Player’s Contract on the grounds of poor
performance and commitment by the Player during training and matches with a
written notice despite the provision of Article 4, Article 5 and Article 8 of the Player’s
Contract and with a full and final compensation of three (3) month salary payable
to the Player upon termination”.
19.
In this respect, the Chamber held that it could not accept article 7.7 as being valid,
as it provides for a unilateral termination right to the benefit of the Respondent. In
addition to the unilateral character of art. 7.7 of the contract, the application of said
article appears to be linked to the Claimant’s medical condition, which, in
accordance with the Chamber’s constant jurisprudence, in itself cannot be
considered a valid reason to terminate an employment contract. Therefore, the
Chamber decided that neither the articles in Schedule D of the contract nor art. 7.7
of the letter of offer could legitimately be invoked to terminate the contractual
relation with the Claimant. Consequently, the Chamber rejected the Respondent’s
argument in this respect.
20.
For the sake of completeness, the members referred to the DRC’s longstanding
jurisprudence, according to which the responsibility to conduct the necessary
medical examinations prior to the signing of an employment contract is incumbent
on the Respondent which, consequently, has the obligation to implement the terms
of the contract and cannot unilaterally question the validity of the contract during
its course, based on the physical state of the player.
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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21.
In view of the aforementioned considerations, the Chamber rejected the arguments
of the Respondent and concluded that, on 13 January 2020, the Respondent
terminated the contract without just cause.
22.
Having established that the club is to be held liable for the early termination of the
employment contract, the DRC focused its attention on the consequences of such
termination.
23.
First of all, the members of the Chamber concurred that the club 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
club is liable to pay to the player the remuneration that was outstanding at the time
of the termination i.e. the amount of USD 20,000, consisting of the advanced salary.
24.
Moreover, the Chamber wished to highlight, that according to the wording of art.
6.1 of the letter of offer, i.e. “First Year 2020” and “Salary 2020”, the Claimant was
not entitled to receive a monthly salary in the amount of USD 10,000 for December
2019.
25.
Furthermore, considering the player’s claim for interest and also taking into account
the DRC’s longstanding jurisprudence, the DRC ruled that the Respondent must pay
5% interest on the amount of USD 20,000 as from the first day after the termination
of the contract, i.e. as from 14 January 2020.
26.
In continuation, the DRC focused its attention on the calculation of the amount of
compensation for breach of contract 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
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.
27.
In application of the relevant provision, the DRC held that it first of all had to clarify
as to whether the pertinent employment contracts contains 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 members of the DRC already established that art. 7.7 of the letter of offer cannot
be considered as valid.
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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28.
As a consequence, the members of the DRC 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
DRC recalled that said provision provides for a non-exhaustive enumeration of
criteria to be taken into consideration when calculating the amount of
compensation payable. Therefore, other objective criteria may be taken into
account at the discretion of the deciding body. In this regard, the Chamber
emphasised beforehand that each request for compensation for contractual breach
has to be assessed by the DRC on a case-by-case basis taking into account all specific
circumstances of the respective matter.
29.
The DRC then turned its attention to the remuneration and other benefits due to
the Claimant under the existing contract and/or the new contract, which criterion
was considered by the Chamber to be essential. The DRC deemed it important to
emphasise that the wording of art. 17 par. 1 of the Regulations allows the DRC to
take into account both the existing contract and the new contract, if any, in the
calculation of the amount of compensation.
30.
Bearing in mind the foregoing, the Chamber proceeded with the calculation of the
monies payable to the player under the terms of the employment contract as from
the date of termination with just cause by the Claimant until its natural expiration,
bearing in mind that he would have received in total USD 120,000 as remuneration
for the period as from January 2020 until November 2020, corresponding to USD
110,000 as salary and USD 10,000 as “Agent Fee”. Consequently, the Chamber
concluded that the amount of USD 120,000 serves as the basis for the final
determination of the amount of compensation for breach of contract in the case at
hand.
31.
In this respect, the Chamber wished to point out that the letter of offer did not
stipulate whether the “Agent Fee” shall be paid directly to the agent or the player
and since the agent did not sign the letter of offer, such amount shall be due to the
player. In addition, the DRC noted that the Respondent failed to provide any
evidence that it paid the player the flight ticket to Malaysia.
32.
In continuation, the members of the DRC 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 enabled to reduce his loss of income.
According to art. 17 par. 1 lit. ii) of the Regulations as well as 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.
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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33.
In this respect, the DRC recalled that the Claimant had found new employment with
the South Korean club, Chuncheon Citizen FC, as from 24 February 2020 until 30
November 2020, providing for a monthly salary of KRW (South Korean Won)
1,700,000, leading to total value for the period corresponding to the time remaining
on the prematurely terminated contract of KRW 15,603,571, which is approx. USD
13,100, which shall be deducted from the above-mentioned residual value. As a
result, the DRC established that the “Mitigated Compensation” amounts USD
106,900.
34.
Consequently, on account of the above-mentioned considerations, the Chamber
decided to partially accept the Claimant’s claim and held that the Respondent must
pay the amount of USD 106,900 as compensation for breach of contract to the
Claimant. Equally, with regard to the Claimant’s claim pertaining to flight tickets
and on the basis of the information provided by FIFA Travel and referring to art. 6.6
of the letter of offer, the Chamber decided that the Respondent must pay to the
Claimant the amount of CHF 710 for the flight ticket from Malaysia to South Korea.
35.
Furthermore, taking into account the consideration under number II./3. above, the
Chamber referred to par. 1 and 2 of art. 24bis 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.
36.
In this regard, the Chamber pointed out 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 and for the maximum duration of three entire and consecutive
registration periods.
37.
Therefore, bearing in mind the above, the DRC decided that, in the event that the
Respondent does not pay the amount due to the Claimant within 45 days as from
the moment in which the Claimant, following the notification of the present
decision, communicates the relevant bank details to the Respondent, a ban from
registering any new players, either nationally or internationally, for the maximum
duration of three entire and consecutive registration periods shall become effective
on the Respondent in accordance with art. 24bis par. 2 and 4 of the Regulations.
38.
Finally, the Chamber recalled that the above-mentioned sanction will be lifted
immediately and prior to its complete serving upon payment of the due amounts,
in accordance with art. 24bis par. 3 of the Regulations.
39.
The DRC concluded its deliberations by rejecting any further claim of the Claimant.
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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III.
Decision of the Dis pute Res olution Cham ber
1.
The claim of the Claimant, Jeon Hyoseok, is partially accepted.
2.
The Respondent, Perak Football Association, has to pay to the Claimant outstanding
remuneration in the amount of USD 20,000, plus 5% interest p.a. as from 14 January
2020 until the date of effective payment.
3.
The Respondent has to pay to the Claimant compensation for breach of contract in
the amount of USD 106,900 and CHF 710, plus 5% interest p.a. on the amount of USD
106,900 as from 17 February 2020 until the date of effective payment.
4.
Any further claim of the Claimant is rejected.
5.
The Claimant is directed to inform the Respondent, immediately and directly,
preferably to the e-mail address as indicated on the cover letter of the present
decision, of the relevant bank account to which the Respondent must pay the
amounts mentioned under points 2. and 3. above.
6.
The Respondent shall provide evidence of payment of the due amount in accordance
with points 2. and 3. above to FIFA to the e-mail address [email protected], duly
translated, if need be, into one of the official FIFA languages (English, French,
German, Spanish).
7.
In the event that the amounts due plus interest in accordance with points 2. and 3.
above are not paid by the Respondent w ithin 45 day s as from the notification by
the Claimant of the relevant bank details to the Respondent, the Respondent shall
be banned from registering any new players, either nationally or internationally, up
until the due amount is paid and for the maximum duration of three entire and
consecutive registration periods (cf. art. 24bis of the Regulations on the Status and
Transfer of Players).
8.
The ban mentioned in point 7. above will be lifted immediately and prior to its
complete serving, once the due amounts are paid.
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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9.
In the event that the aforementioned sums plus interest are still not paid by the end
of the ban of three entire and consecutive registration periods, the present matter
shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration
and a formal decision.
*****
Note related to the publication:
The FIFA administration may publish decisions issued by the Players’ Status Committee or
the DRC. Where such decisions contain confidential information, 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 20 of the Rules Governing the Procedures
of the Players’ Status Committee and the Dispute Resolution Chamber).
Note relating to the m otiv ated decision (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. 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
e-mail: [email protected]
www.tas-cas.org
For the Dispute Resolution Chamber:
Emilio García Silvero
Chief Legal & Compliance Officer
Player Jeon Hyoseok, Korea Republic / Club Perak Football Association, Malaysia
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