F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – coach disputes / controversie allenatori (2020-2021) – fifa.com – atto non ufficiale – Decision12 January 2021

Decision of the

Single Judge of the Players' Status Committee

passed in Zurich, Switzerland, on 12 January 2021,

regarding an employment-related dispute concerning the coach A

BY:

Stefano La Porta (Italy), Single Judge of the PSC

CLAIMANT:

Coach A, Country A

Represented by

RESPONDENT:

Club B, Country B

I. FACTS

1. On 26 November 2019, the Claimant and the Respondent (hereinafter jointly referred to as the parties) signed an employment agreement valid as of the date the Claimant “reports to the Management” until “the end of the last Country B-League match / Super Cup of the season 2019-20 or 31 May 2020 whichever is earlier without any prejudice to the club”.

2. Moreover, said employment agreement established that “[n]o compensation will be paid if the Management terminates agreement of the Head Coach for indiscipline and if there is no improvement in the team. However, the Management will give [the Claimant] one month’s notice to improve the performance of our football team”:

‘The period of this Agreement is from the date he reports to the Management and shall remain in force till the end of the last Country B -League match I Super Cup of the season 2019-2020 or 31st May 2020 whichever is earlier without any prejudice to the club. No compensation will be paid if the Management terminates agreement of the Head Coach for Indiscipline and if there is no improvement in the team. However, the Management will give you one month's notice to improve the performance of our Football Team’

3. The parties agreed upon financial conditions as follows:

A) The Head Coach will be paid a Net professional fee of 2,85,000 xxx (xxx only per month for the agreement period provided he complies to his obligation as in Act 1 & 2 above.

B) A bonus of 6,00,000 xxx will also paid to you if the club becomes Country B - League champions for the season 2019-20. The said amount will be paid to you as soon as we get the prize money from Country B Football Federation.

C) The professional fee payable to the Head Coach under this Agreement is exclusive of

withholding tax or any other applicable indirect taxes and duties in Country B.

D) The Head Coach will be provided fully furnished A/C accommodation.

4. The parties furthermore agreed that the Claimant will be provided rturn flight tickets:

The Head Coach will be provided flight ticket from Country A to Country B and a return ticket from Country B to Country A

5. Also, parties agreed upon the coach’s duties and responsibilities as follows:

The Head Coach duties In the management are coaching and training of the players. The Management will decide about the selection of the Players.

The Management has full right to appoint the working staff of the club.

The Management is responsible for the working of the club's funds and other matters.

6. According to the Claimant, on 9 March 2020, the Respondent unilaterally terminated the contract.

7. According to the letter of 9 March, the performance of the team “has been pathetic” and after the analysis of the management, the Respondent decided that the termination of the Claimant’s employment contract with immediate effect was “the only alternative”. Moreover, the there was “no improvement in the team’s performance”.

8. The letter of 9 March also provided that the Claimant “will receive all salary earned until 8 March

2020. Once received [the Claimant] will have to sign a release and waiver agreement that the club does not owe any dues”.

9. In this regard, the Claimant maintained that he cannot accept the termination based on poor performance of the club as the team’s performance was not “his fault”, but the fault of “the players, the working staff and […] the Management of the Respondent Club”, as the latter was responsible for the selection of the players and the working staff.

10. On 25 March 2020, the Claimant sent a letter to the Respondent, arguing that the termination was without just cause and requested the payment of the following amounts within 10 days, however to no avail:

- February: 285,000

- March: 285,000

- April: 285,000

- May: 285,000

- Flight ticket: EUR 870

- Taxes: EUR 45

11. In his claim, the Claimant was of the opinion that the Respondent terminated the contract without just cause. On the one hand, the “low performance is not considered a just cause for the termination of an employment contract”; on the other hand, by “the non-payment of wages and the disrespect of other clauses and essential rights of the coach.”

12. The Claimant maintained that the Respondent did not respect art. 13 RSTP and art. 14 RSTP.

13. Furthermore, the Claimant deemed to be entitled to compensation according to art. 17 par.

1 RSTP for the termination of the contract without just cause.

14. On 17 April 2020, the Claimant lodged a claim in front of PSC, requesting the payment of following amounts, as well as 5% interest p.a.:

- February: 285,000

- March: 285,000

- April: 285,000

- May: 285,000

- Flight ticket: EUR 870

- Taxes: EUR 45

15. In reply to the claim of the Claimant, the Respondent held that the contract was mutually terminated on 9 March 2020 due to the poor performance of the team. The Respondent underlined that said termination is signed by the Claimant and that he agreed to it.

16. The Respondent held that the termination only provided for the Claimant to receive his remuneration up to 8 March 2020 and nothing else. Despite this, on 16 March 2020, the Claimant contacted the Respondent requesting the salary of April 2020 and a flight ticket to go back to Country A but because the Claimant allegedly did not inform the Respondent of his departure date, the ticket date could not be changed.

17. In an alleged meeting at the Respondent’s premises on 18 March 2020, the Respondent provided the Claimant with a bank check of 422,900 corresponding to the Claimant’s due until 8 March 2020.

18. The Respondent held that in any case, as from 15 March 2020, the season in Country B was effectively terminated due to the COVID-19 pandemic and this impacts the contract of the Claimant. It explained that it could not reply to the default notice of 25 March 2020 since the administrative staff of the club did not have access to the club. The Respondent replied to the default on 28 April 2020.

19. The Respondent considered that it acted in good faith since it was even willing to pay the Claimant until 15 March 2020 (effective date of termination of the Country B League) and informed the Claimant that it would pay him 422,900 and requested the confirmation of the Claimant on the amount and the banking details of the Claimant.

20. On 2 May 2020, the Claimant refused the offer of the Respondent and deemed that the termination of 9 March was not valid.

21. According to the Respondent, the Claimant mistook the end date of the contract since the contract provided that it would be either after the last Country B League or super cup match of the 2019/2020 season.

22. On the flight tickets, the Respondent held that it had bought flight tickets for the Claimant but had to change the date, but the Claimant never informed the Respondent of the requested departure date. With this in mind, the Respondent considered that it was not obligated to reimburse any flight ticket to the Claimant.

23. On the outstanding, the Respondent acknowledges a debt of 422,900 corresponding to the month of February to 15 of March 2020 and that it would proceed to make such payment before

25 June 2020 and provide evidence to FIFA.

24. In an unsolicited correspondence, the Respondent provided a proof of payment of USD

5,561.54 on 23 June 2020 in favour of the Claimant, corresponding to 422,900 according to the Respondent, for the “services provided till 15 March 2020”.

25. In reply to the request of FIFA, the Claimant held that should the Respondent have wanted to pay the amount for a month and a half (February and until 15 March 2020) “the amount in x should have been 427,500” hence adding that 4,600 is missing.

26. After being requested to, the Claimant informed FIFA that he remained unemployed for the relevant period.

II. CONSIDERATIONS OF THE SINGLE JUDGE OF THE PSC

1. First of all, the Single Judge of the PSC (hereinafter also referred to as Single Judge) analyzed whether he was competent to deal with the case at hand. Taking into account the wording of art. 21 of the June 2020 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.

2. Subsequently, the Single Judge of the PSC referred to art. 3 par. 1 of the Procedural Rules and emphasized that, in accordance with art. 24 par. 1 in combination with art. 22 lit. c) of the Regulations on the Status and Transfer of Players, the Single Judge of the PSC is competent to deal with matters which concern employment-related disputes with an international dimension between a coach and clubs.

3. In continuation, the Single Judge of the PSC analyzed which edition of the Regulations of the Status and Transfer of Players should be applicable to the present matter. In this respect, the Single Judge of the PSC confirmed that in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players, and considering that the claim was lodged on 17 April 2020, the March 2020 edition of the aforementioned regulations (hereinafter: the Regulations) is applicable to the matter at hand.

4. With the above having been established, the Single Judge of the PSC entered into the substance of the matter. In doing so, it started to acknowledge the facts of the case as well as the documents contained in the file. However, the Single Judge of the PSC emphasized that in the following considerations it will refer only to facts, arguments and documentary evidence, which it considered pertinent for the assessment of the matter at hand.

5. In this respect, the Single Judge noted that, on 26 November 2019, the Claimant concluded a contract with the Respondent, valid for the period that the Claimant “reports to the Management” until “the end of the last Country B-League match / Super Cup of the season 2019-20 or

31 May 2020 whichever is earlier without any prejudice to the club”. According to the information in the TMS, the season 2019/2020 in Country B would run as of 1 June 2019 until 31 May 2020.

6. Subsequently, the Single Judge observed that the Claimant lodged a claim before FIFA for breach of contract without just cause, arguing that the Respondent unilaterally terminated the contract without valid reasons on 9 March 2020, allegedly because of the poor sporting performance of the Respondent’s first team.

7. Conversely, the Single Judge noted that, according to the Respondent, the claim of the Claimant cannot be upheld, as the termination of the contract was made by mutual consent between the parties. Moreover, the Respondent argues that the termination only provided for the fact that the Claimant would receive his remuneration until 8 March 2020 and that the contract would anyway end on 15 March 2020, as a result of the suspension of the Country B League because of the COVID-

19 pandemic. Finally, the Respondent argued that it was not obliged to reimburse the Claimant for his flight ticket, as it had already bought flight tickets for the Claimant, who subsequently changed its flight and never informed the Respondent about this fact.

8. In view of the above, the Single Judge considered that the main legal issue at stake is to determine which party had had terminated the contract, whether said termination was made with or without just cause on 9 March 2020 and which party shall be held responsible for said termination.

9. In this respect, the Single Judge first of all wish to address that from the information on file it appears that the contract was terminated on 9 March 2020. After analysing the contents of the termination, the Single Judge concluded that the – despite the fact that both the Claimant and the Respondent signed the letter - its wording is clear in the sense that the termination was a unilateral decision of the Respondent, due to the poor performance of the team.

10. Moreover, the Single Judge noted that the letter further states that the Claimant’s salary would be paid until 8 March 2020 and that a waiver would be signed in the future, however that no such waiver was in fact issued. Thus, the Single Judge concluded that the termination latter can neither be interpreted as a mutual termination agreement, nor as a waiver.

11. Furthermore, as to the reasons brought forward in the letter for the termination of the contract, the Single Judge pointed out that, in accordance with its longstanding jurisprudence of the Player’s Status Committee and as a general principle, the alleged poor or unsatisfactory performance of a team cannot be considered as a valid reason to terminate the contract of the Claimant. Hence, the Single Judge considered that by terminating the Claimant’s contract based on poor performance, the Respondent acted in an abusive manner and without just cause.

12. Furthermore, the Single Judge wished to point out that the arguments of the Respondent in connection with the COVID-19 pandemic cannot be upheld in this respect, as the termination of the Claimant’s contract took already place on 9 March 2020, a point in time before the suspension of the ‘Country B league’ in Country B (15 March 2020).

13. In view of all the previous considerations, the Single Judge established that the termination of the contract by the Respondent on 9 March was without just cause and, as a result, the Claimant is entitled to outstanding remuneration and compensation for breach of contract

14. First of all, the Single Judge concurred that the Respondent must fulfill its obligations as per employment contract up until the date of termination of the contract in accordance with the general legal principle of “pacta sunt servanda”.

15. Analysing the documentation on file, the Single Judge noted that the Claimant is claiming the salary for February 2020, although that the Claimant made some – not unequivocally clear – comments about payments in the amount of USD 5,561.54 or 420,886 the Respondent made, in which the payment of the salary for February 2020 was not clearly disputed. As a result the Single Judge decided that at the date of the termination of the contract, 9 March 2020, no remuneration was outstanding.

16. In continuation, the Single Judge focused his attention on the calculation of the amount of compensation for breach of contract in the case at stake. In doing so, the Single Judge firstly recapitulated that, in accordance with the jurisprudence of the Players’ Status Committee, 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.

17. In application of the relevant provision, the Single Judge 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 Single Judge observed that that clause 2 of the contract stipulated that no compensation would be payable in case of an early termination of the contract because of poor performance.

18. Yet, in relation to said clause, the Single Judge considered that the clause appears to be potestative and - against the PSC’s jurisprudence - not reciprocal. As a consequence, the Single Judge decided that he could not consider the consequences of said clause in its entirety.

19. Bearing in mind the foregoing, the Single Judge considered that the amount of payable compensation shall be calculated in accordance with the jurisprudence of the Players’ Status Committee.

20. In view of the above, the Single Judge proceeded with the calculation of the monies payable to the Claimant under the terms of the employment contract until its original date of expiration.

21. In particular, the Single Judge understood that, since the early termination of the contract on 9

March 2020, the contract was in principle supposed to run to 31 May 2020. In this respect, the Single Judge pointed that from the documentation submitted by the Respondent, it is not clear how long the season in Country B would remain suspended or as from when the season 2019/2020 “remained conclude”. As a result, the Single Judge deemed that the original end date of the contract, i.e. 31 May 2020, should be taken into account.

22. As to the calculation, the Single Judge took into account that allegedly an amount of USD

5,561.54 net or 420,886 net was paid, which covered the month of February 2020 in full (cf. point. II./15. above), as well as part of the March salary up to an amount of 135,886 net. In conclusion, the Single Judge deemed that for March 2020, an amount of 149,114 net remained outstanding (i.e. 285,000 minus 135,886). Furthermore, for the months of April and May 2020, the Claimant would have been entitlement to two payment of 285,000 net each. As a result, the Single Judge deemed that the Claimant would have received a total amount of 719,114 net.

23. Consequently, the Single Judge established that the amount of 719,114 net shall serve as the basis for the calculation of the payable compensation.

24. Subsequently, the Single judge 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 in this regard, 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 Claimant’s general obligation to mitigate his damages.

25. In this respect, the Single Judge observed that the Claimant informed the FIFA Administration that after the unilateral termination of the contract, he had remained unemployed.

26. As a result, the Single Judge understood that the Claimant was therefore unable to mitigate his damages and that no further amount shall be deducted from the amount of 719,114 the Claimant is in principle entitled to.

27. In view of the above, the Single Judge established that the Respondent shall pay to the Claimant the amount of 719,114 net as compensation for breach of contract without just cause.

28. In addition, taking into consideration the Claimant’s request as well as the constant practice of the Dispute Resolution Chamber and the Players’ Status Committee in this regard, the Single Judge decided to award the Claimant interest at the rate of 5% p.a. on the amount of

719,114 net as of 17 April 2020.

29. Furthermore, as to the flight ticket claimed by the Claimant, the Single Judge decided that there was no documentary evidence submitted by the Claimant on file on which a potential reimbursement could be based. However, in line with the standard practice of the Player’s Status Committee, a one-way ticket as per the contract can be granted, the costs of which, CHF 1,210, were confirmed by FIFA Travel.

30. In continuation, the Single Judge of the PSC referred to art. 25 par. 2 of the Regulations in combination with art. 18 par. 1 of the Procedural Rules, according to which in the proceedings before the Players’ Status Committee costs in the maximum amount of CHF 25,000 are levied. The costs are to be borne in consideration of the parties’ degree of success in the proceedings.

31. In this respect, the Single Judge of the PSC referred to the Covid-19 Football Regulatory Issues – FAQ, published on 11 June 2020 which establish that, given the current circumstances there will be no requirement to pay an advance of costs and no procedural costs shall be ordered. Therefore, the Single Judge established that the present decision shall be rendered without costs.

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Emilio García Silvero

III. DECISION OF THE PLAYERS' STATUS COMMITTEE

1. The claim of the Claimant A, is partially accepted.

2. The Respondent B, has to pay to the Claimant, the following amount:

- 719,114 net as compensation for breach of contract without just cause plus 5% interest p.a. as from 17 April 2020 until the date of effective payment;

- CHF 1,210 as reimbursement of a one-way flight ticket from Country B to Country A.

3. Any further claim lodged by the Claimant is rejected

4. The Claimant is directed to immediately and directly inform the Respondent of the relevant bank account to which the Respondent must pay the due amount.

5. The Respondent shall provide evidence of payment of the due amount in accordance with this decision to psdfifa@fifa.org, duly translated, if applicable, into one of the official FIFA languages (English, French, German, Spanish).

6. This decision is rendered without costs.

7. In the event that the amount due, plus interest as established above is not paid by the Respondent within 30 days, as from the notification by the Claimant of the relevant bank details to the Respondent, the following consequences shall arise:

1. In the event that the payable amount as per in this decision is not paid within the granted deadline , the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee.

For the Players' Status Committee:

Chief Legal & Compliance Officer

NOTE RELATED TO THE APPEAL PROCEDURE:

According to article 58 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 20 of the Procedural Rules).

CONTACT INFORMATION:

Fédération Internationale de Football Association

FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland www.fifa.com | legal.fifa.com | psdfifa@fifa.org | T: +41 (0)43 222 7777