Labour Disputes
Texto da decisão
REF FPSD-3145
Decision of the
Dispute Resolution Chamber
Passed on 13 January 2022,
regarding an employment-related dispute concerning the player Diego
Fabian Polenta Museti
COMPOSED AS FOLLOWS:
Frans DE WEGER (Netherlands), Chairperson
Sihon GAUCI (Malta), member
Laurel VAURASI (Fiji), member
CLAIMANT:
Diego Fabian Polenta Museti , Uruguay
Represented by Mr Luca Tettamanti
RESPONDENT:
Club Olimpia , Paraguay
Represented by Mr Ariel N. Reck
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REF FPSD-3145
I. Facts
1. On 1 January 2020, the player Diego Fabian Polenta Museti and Club Olimpia concluded an
employment contract valid as from the date of signature until 31 December 2023.
2. According to clause 2 of the contract, the player was entitled to the following monthly remuneration:
First year 2020: USD 50,000 plus VAT
Second year 2021: USD 66,666 plus VAT
Third year 2022: USD 66,666 plus VAT
Fourth year 2023: USD 66,666 plus VAT
3. On 13 March 2020, the PFA announced the suspension of all competitions due to the COVID
outbreak.
4. On 29 March 2021, the Parties signed a private agreement (“Acuerdo Privado”) by which they
established a payment plan for the salaries of April, May and June 2020, as follows:
• La suma de DOLARES ESTADOUNIDENSES NOVENTA Y UN MIL CIENTO CUARENTA (USD 91.140) Iva
incluido, a ser abonado en fecha 29 de marzo de 2022.
• La suma de DOLARES ESTADOUNIDENSES OCHENTA Y CUATRO MIL TRESCIENTOS VEINTE (USD.
84.320) Iva incluido, a ser abonado en fecha 29 de marzo de 2023.
• La suma de GUARANI ES CIENTO OCHENTA MILLONES QUINIENTOS VEINTISEIS MIL TRESCIENTOS
DIECISEIS (Gs, 180,526.316) Iva incluido, a ser abonado en fecha 29 de marzo de 2022.
• La suma de GUARANIES CIENTO SESENTA Y SIETE MILLONES DIECISIETE MIL QUINIENTOS CUARENTA
Y CUATRO (Gs. 167.017.544) Iva incluido, a ser abonado en fecha 29 marzo de 2023.
Free translation into English:
- USD 91,140 VAT included, to be paid on 29 March 2022.
- USD 84,320 VAT included, to be paid on 29 March 2023.
- PYG 180,526.316 VAT included, to be paid on 29 March 2022.
- PYG 167,017,544 VAT included, to be paid on 29 March 2023.
5. On 10 June 2021, the club sent a termination notice with the following contents:
“Notificole el club olimpia ha decidioo dar por terminado el contrato de trabajo deportivo oue los
vincula por el motivo oe la pandemia actual, basado en lo dispuesto en el art 78 inciso d} v art 79 del
codigo del trabajo de paraouay, y debido a la necesaria reducción de integrantes del plantel de futbol
del club olimpia, para .estricto cumplimiento del protocolo apf covid· 19 ·dela vuelta al futbol la
tesoreria del club se pondrá en contacto con ud, y/o su agente para determinar la liquidacion y
entrega de los documentos que correspondan.
Free translation from Spanish:
"Club olimpia has decided to terminate the sports employment contract that binds them for the
reason of the current pandemic, based on the provisions of art 78 paragraph d} v art 79 of the Labour
Code of Paraguay, and due to the necessary reduction of members of the football team of the club
Olimpia, and for compliance with the protocol AFP COVID- 19. The finance department will contact
you, and/or your agent to determine the settlement and delivery of the corresponding documents.
6. On 27 August 2021, the player concluded a contract with the Uruguayan Club, Nacional de
Football, valid as from 27 August 2021 until 31 December 2021.
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7. Accordingly, the player was entitled to USD 21,000 per month gross or USD 14,000 net (the value
of said contract can be estimated in USD 84,000 gross, i.e. 4*21,000 or 56,000 net, i.e. 4*14,000).
8. On 26 July 2021, the player Diego Fabian Polenta Museti lodged a claim before FIFA for
outstanding remuneration and breach of contract without just cause, and requested the following:
- USD 339,204 and PGY 347,543,860 as outstanding remuneration plus 5% interest p.a. until the
date of effective payment as follows:
- 5% interest p.a. as from 11 May 2021 on USD 66,666;
- 5% interest p.a. as from 11 June 2021 on USD 175,460;
- 5% interest p.a. as from 11 June 2021 on USD 66,666;
- 5% interest p.a. as from 11 July 2021 on USD 22,222;
- 5% interest p.a. as from 11 June 2021 on USD 8,190;
- 5% interest p.a. as from 11 June 2021 on PGY 347,543,860;
USD 2,444,424 as compensation plus 5% interest p.a. from 11 June 2021 until the date of full and
effective payment corresponding to the residual value of the contract (i.e. USD 44,444 for 20 days
of June 2021 plus 30 months per USD 66,666 each until 31 December 2023)
9. The Claimant detailed his request for outstanding remuneration as follows:
USD 175,460 as outstanding salaries of April, May and June 2020 (except for the USD 10,000
meanwhile received by the Player) plus interests as per third clause of the Acuerdo Privado for a total
of as acknowledged by the Club in the fifth clause of the Acuerdo Privado (Exhibit C8 of the claim);
- PYG 347,543,860 as bonus for having won the Torneo Clausura 2020 plus interests as per fourth
clause of the Private Agreement for a total of as acknowledged by the Club in the fifth clause of the
Acuerdo Privado (Exhibit C8).
- USD 155,554 as outstanding salaries for April, May and the 10 days of June 2021 due as per the
Contract for a total of (2 months per USD 66,666 each plus USD 22,222 for 10 days of June 2021).
and collective bonus of USD 8,190 promised by the Club to all the first team players.
10. The Claimant further requested the payment of the procedural costs.
11. The player argued that the justifications set out by the club in its termination notice “do not stand,
are illegitimate (…) and must be entirely dismissed”.
12. The Claimant further underlined that the current pandemic cannot constitute a just cause nor a
case of force majeure justifying the termination of the Contract.
13. The Claimant considered that the Covid-19 outbreak was invoked by the Club in support of its
dismissal in a totally opportunistic manner. In this sense, the Claimant noted that it is striking to
note that the Club avers the pandemic as just cause or force majeure 1 ½ (one and a half) year later
than its appearance in Paraguay
14. In its reply to the Claim, the Respondent argued that the player did not accept any salary deduction
for this, only a deferral of part of the salary. The club pointed out that the player was one of the
highest paid players.
15. The club further argued that, due COVID-19, the AFP limited trainings to 35 players and considered
this to be a force majeure situation.
16. The club also argued that the suspension of football activities had a severe impact in Olimpia's
finances.
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17. The club explained that the slowness in the vaccination campaign and the second wave of Covid-19
prevented Olympia from bringing the public back to the stadium.
18. The club referred to the case law of the Swiss Federal Tribunal and the doctrine of "rebus sic
stantibus" allows one of the parties to be released from the performance of the obligations as
agreed in the contract in the event of an extraordinary change of circumstances. In particular, the
club considered that nobody expected that the pandemic would last for such a long time. n
particular, the club considered that nobody expected that the pandemic would last for such a long
time.
19. As to the outstanding salaries, the club considered that 15% income tax and 10% VAT shall be
deducted.
20. The Respondent argued that the following amounts should be deducted from the player’s claim:
Deferred and unmatured sums due under the private agreement USD 175,460
The claim for never agreed prizes: USD 8,190
The claim for sports damages USD 400.000
21. In his replica, the player stated that he already addressed that there was no force majeure in this
case.
22. As to the alleged rebus sic stantibus situation, the player argued that the relevant Swiss doctrine
and case law, as in BGE 122 III 97, clarified that it can be used in an extremely restrictive way and in
circumstances which are not present at all in the present case.
23. The player underlined that it must be remembered that the COVID-19 pandemic erupted in
Paraguay during March 2020 whilst the Club terminated the Player’s Contract on 10 June 2021, i.e.
more than 1 ½ year later.
24. The player also explained that he did try to negotiate, which is why the private agreement was
signed.
25. As to the limitation of training imposed by the APF, the player argued that this argument raised by
the Club is also against its own position: the Player’s possible deregistration following the decision
of the Club’s coach had infringed the players’ personality rights and his fundamental right to play
caused alone the right of the Player to terminate the Contract for just cause
26. As final comments, the club sent a report from “Vergara – Sociedad de Profesionales Contadores –
Abogados”, according to which the club had to pay taxes as follows:
No residentes
Amount for services with VAT
VAT
Service amount without VAT
Withholding earning- INR (15%
*70%
Net due amount
110
10
100
10,50
89,50
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II
Considerations of the DRC
a.
Competence and applicable legal framework
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 presented to FIFA on 26 July 2021 and submitted for decision on 13
January 2022. Taking into account the wording of art. 34 of the October 2021 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.
2.
Subsequently, the Chamber referred to art. 2 par. 1 and art. 24 par. 1 lit. b) 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 (August 2021 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 an Uruguayan player and
a Paraguayan club.
3.
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 (August 2021 edition), and considering that the
present claim was lodged on on 26 July 2021, the February 2021 edition of said regulations
(hereinafter: the Regulations) is applicable to the matter at hand as to the substance.
b.
Burden of proof
4.
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
5.
Its competence and the applicable regulations having been established, the Chamber entered into
the merits of the dispute. In this respect, the Chamber started by acknowledging all the abovementioned 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 the assessment of the matter at hand.
A.
Main legal discussion and considerations
6.
In this respect, the Chamber noted that, on 1 January 2020, the parties concluded an employment
contract valid as from the date of signature until 31 December 2023.
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REF FPSD-3145
7.
Subsequently, the Chamber observed that, on 29 March 2021, the parties signed a private
agreement (“Acuerdo Privado”) by which they established a payment plan for the salaries of April,
May and June 2020.
8.
Thereafter, the Chamber observed that the player lodged a claim before FIFA against the club for
outstanding remuneration and breach of contract without just cause, by means of which he
claimed the amounts quoted in point I. 8 above. In particular, the Chamber remarked that the
club sent a termination notice to the player on 10 June 2021.
9.
On the other hand, the Chamber took note of the Respondent’s position, according to which it
was affected by the outbreak of the COVID-19 pandemic and its related measures including, inter
alia, the limitation of trainings to 35 players. The Chamber therefore noted that the club argued
that it was under a situation of force majeure.
10. In view of the above, the Chamber understood that the main legal issue at stake is to determine
whether the club had a just cause to terminate the contract on 10 June 2021.
11. As a result, the Chamber deemed it to be pertinent to recall the contents of the aforementioned
termination letter, which was drafted as follows:
“Notificole el club olimpia ha decidido dar por terminado el contrato de trabajo deportivo oue los
vincula por el motivo de la pandemia actual, basado en lo dispuesto en el art 78 inciso d} v art 79
del codigo del trabajo de Paraguay, y debido a la necesaria reducción de integrantes del plantel
de futbol del Club Olimpia, para estricto cumplimiento del protocolo APF COVID-19 ·de la vuelta
al futbol. La tesoreria del club se pondrá en contacto con ud, y/o su agente para determinar la
liquidacion y entrega de los documentos que correspondan.
Free translation from Spanish:
"Club olimpia has decided to terminate the sports employment contract that binds them for the
reason of the current pandemic, based on the provisions of art 78 paragraph d} v art 79 of the
Labour Code of Paraguay, and due to the necessary reduction of members of the football team
of the club Olimpia, and for compliance with the protocol AFP COVID- 19. The finance
department will contact you, and/or your agent to determine the settlement and delivery
of the corresponding documents.
12. After carefully examining the contents of the termination letter, the Chamber were eager to
emphasise that only a breach or misconduct which is of a certain severity would justify the
termination of a contract without prior warning. In other words, only when there are objective
criteria which do not reasonably permit to expect a continuation of the employment relationship
between the parties, a contract may be terminated prematurely. Hence, if there are more lenient
measures which can be taken in order for an employer to assure the employee’s fulfilment of his
contractual duties, such measures must be taken before terminating an employment contract. A
premature termination of an employment contract can only be used as ultima ratio.
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13. In this respect, the Chamber observed that the termination letter was sent by the Respondent
without any prior notice, and therefore the club did not comply with the principle of ultima ratio.
14. In addition, the Chamber also noted that the club appears to have terminated the contract in a
discretionary manner in view of the fact that the player was apparently one of the highest earners.
15. As a result, the Chamber established that the club is liable for the early termination of the contract
and that the player is consequently entitled to compensation.
B.
Consequences
16. 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.
17. In this respect, and before entering into the calculation of the payable compensation, the
Chamber examined whether the club had any outstanding payment towards the player until the
date of termination of the contract, i.e. 10 June 2021.
18. In this respect, the Chamber noted that the Respondent partially acknowledged the claimed
outstanind amounts, expect for the amount included in the private agreement as well as to a
bonus of USD 8,190 bonuses. The Chamber noted that the Respondent argued that, in any case,
15% income tax and 10% VAT shall be deducted from the player’s request.
19. In relation to this last argument, however, the Chamber noted that the contract stipulated net
amounts for the player’s remuneration (i.e. “50,000 plus VAT”).
20. In addition, the Chamber confirmed that, as per the private agreement, the player deferred the
payments of the salaries and bonuses of 2020 until 2022. Consequently, the Chamber understood
that these amounts are therefore not yet due.
21. Consequently, after duly examining the player’s request and the respondent’s reply, as well as the
evidence gathered during the course of the investigation, the Chamber established that the
amount of USD 133,332, corresponding to the player’s salaries for April and May 2021, remain
outstanding.
22. Consequently, in strict application of the principle of pacta sunt servanda, the Dispute Resolution
Chamber established that the Respondent has to pay to the Claimant, the total outstanding
amount of USD 133,332, as detailed in the previous paragraph.
23. Moreover, taking into account the request of the Claimant as well as the longstanding
jurisprudence in this regard, the Dispute Resolution Chamber decided to award 5% interest p.a.
over said amount as from the due dates.
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24. In continuation, having established that the Respondent is to be held liable for the termination of
the contract with just cause by the Claimant, the Chamber decided that, in accordance with art.
17 par. 1 of the Regulations, the club is liable to pay compensation to the player.
25. In this respect, the Chamber focused its attention on the calculation of the amount of
compensation for breach of contract 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 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.
26. In application of the relevant provision, the Chamber held that it first of all had to clarify as to
whether the pertinent employment contract 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 Chamber established that no such
compensation clause was included in the employment contract at the basis of the matter at stake.
27. 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. Therefore, other objective criteria may be taken into account
at the discretion of the deciding body.
28. The members of the Chamber then turned their attention to the remuneration and other benefits
due to the player under the existing contract and/or the new contract, which criterion was
considered by the Chamber to be essential. The members of the Chamber deemed it important
to emphasise that the wording of art. 17 par. 1 of the Regulations allows the Chamber to take
into account both the existing contract and the new contract in the calculation of the amount of
compensation.
29. 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 its date of termination
with just cause, i.e. 10 June 2021 until 31 December 2023, and concluded that the Claimant
would have received the following:
June 2021-December 2021 (7*66,666) = 466,662
2022 (12*66,666) = 799,992
2023 (12*66,666) = 799,992
Total: USD 2,066,646 net.
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30. Consequently, the Chamber concluded that the amount of USD 2,066,646 net serves as the basis
for the final determination of the amount of compensation for breach of contract in the case at
hand.
31. In continuation, the Chamber 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 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.
32. In this respect, the Chamber verified, on 27 August 2021, the player concluded a contract with
the Uruguayan Club, Nacional de Football, valid as from 27 August 2021 until 31 December
2021.
33. Accordingly, the Chamber observed that the player was entitled to 14,000 net. As a result, the
Chamber considered that the value of said contract can be estimated in 56,000 net, i.e. 4*14,000.
34. In view of the above, the Chamber established that, at this stage, the amount of payable
compensation corresponds to USD 2,010,646 (i.e. 2,066,646 – 56,000).
35. However, the Chamber further noted that, insofar the player deferred, via the conclusion of the
private agreement, the payment of his salaries of April, May and June 2020 to 2022 and 2023,
the Chamber considered that the related amounts shall be integrated into the payable
compensation. In particular, the Chamber noted the following amounts:
1. USD 91,140 VAT included, to be paid on 29 March 2022.
2. USD 84,320 VAT included, to be paid on 29 March 2023.
3. PYG 180,526.316 VAT included, to be paid on 29 March 2022.
4. PYG 167,017,544 VAT included, to be paid on 29 March 2023.
36. Consequently, taking into account the aforementioned payments, the Chamber decided to add
said amounts to the mitigated compensation (i.e. USD 2,010,646 + USD 91,140 + USD 84,320 +
PYG 180,526,316 + PYG 167,017,544), leading to a total payable compensation of USD
2,186,106 and PYG 347,543,860.
37. On account of all of the above-mentioned considerations and the specificities of the case at hand,
the Chamber decided to partially accept the player’s claim and that the club must pay the amount
of USD 2,186,106 and PYG 347,543,860 as compensation for breach of contract in the case at
hand.
38. 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 aforementioned amount as of the date of the claim.
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C.
Compliance with monetary decisions
39. Furthermore, taking into account the previous considerations, the Dispute Resolution 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.
40. In this regard, the Dispute Resolution 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.
41. Therefore, bearing in mind the above, the Dispute Resolution Chamber decided that, in the event
that the Respondent does not pay the amounts 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.
42. Finally, the Dispute Resolution Chamber recalled that the above-mentioned ban 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.
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III Decision of the DRC
1.
The claim of the Claimant, Diego Fabian Polenta Museti, is partially accepted.
2.
The Claimant, Club Olimpia, has to pay to the Claimant the following amounts:
- USD 133,332 as outstanding remuneration, plus interest as follows:
-
5% p.a. on the amount of USD 66,666 from 1 May 2021 (salary April 2021) until the date of effective payment
5% p.a. on the amount of 66,666 USD from 1 June 2021 (salary of May 2021) until the date of effective payment.
- USD 2,186,106 and PYG 347,543,860 as compensation for breach of contract without
just cause, plus 5% interest p.a. as from 26 July 2021 until the date of effective payment.
3.
Any further claims of the Claimant are rejected.
4.
The Respondent shall pay the full payment (including all applicable interest) into the bank
account indicated on the attached bank account registration form.
5.
Pursuant to art. 24bis of the Regulations on the Status and Transfer of Players (February 2021
edition), if full payment (including all applicable interest) is not made within 45 days of
notification of this decision, the following consequences shall apply:
1. The Respondent shall be banned from registering any new players, either nationally or
internationally, up until the due amount is paid. The maximum duration of the ban shall
be of up to three entire and consecutive registration periods.
2. The present matter shall be submitted, upon request, to the FIFA Disciplinary
Committee in the event that full payment (including all applicable interest) is still not
made by the end of the three entire and consecutive registration periods.
6. The consequences shall only be enforced at the request of the Claimant in accordance
with art. 24bis par. 7 and 8 and art. 24ter of the Regulations on the Status and Transfer of
Players.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
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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).
CONTACT INFORMATION:
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FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland
www.fifa.com | legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
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