F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – overdue payables / debiti scaduti – (2020-2021) – fifa.com – atto non ufficiale – Decision 19 November 2020

Decision of the

Dispute Resolution Chamber

passed on 19 November 2020,

regarding an employment-related dispute concerning the player Boris KLEYMAN

COMPOSITION:

Geoff Thompson (England), Chairman Daan de Jong (Netherlands), member Michelle Colucci (Italy), member

CLAIMANT:

BORIS KLEYMAN, Israel

Represented by Mr Loizos Hadjidemetriou

RESPONDENT:

ENOSIS NEON PARALIMNIOU FC, Cyprus

Represented by Mr George Christofides

I. FACTS OF THE CASE

1. On 23 July 2018, the Israeli player, Boris Kleyman (hereinafter: Claimant or player) and the Cypriot club, Enosis Neon Paralimniou (hereinafter: Respondent or club) concluded an employment contract (hereinafter: contract) valid as of 1 August 2018 until 30 May 2020.

2. According to art. 1.3 of the contract, the club undertook to pay the player as follows:

 As from 1 August 2018 until 30 May 2019: monthly gross salary of EUR 2,169.20 (EUR 2,000 net);

 As from 1 August 2019 until 30 May 2020: monthly gross salary of EUR 2,711.50 (EUR 2,500 net).

3. Art. 2.4 of the contract stated that both parties agree that the contract will be automatically renewed for the season 2019/2020 (1 August 2019 until 20 May 2020) “if the Player plays 75% of the played time of the championship of football season 2018-2019”.

4. According to art. 2.2 and 2.3 of the contract, the Standard Employment Contract (hereinafter: the SEC) constitutes an integral part of the contract.

5. On 23 July 2018, the player and the company The Royal Sport Management (Cyprus) Limited (hereinafter: the Agency) signed the “Agreement on transfer of merchandising rights” (hereinafter: the agreement), valid as from the date of signature until 30 May 2020.

6. According to art. 7 of the agreement, the Agency undertook to pay to the player the following:

 As from 1 August 2018 until 30 May 2019: EUR 40,000 to be paid in 10 monthly instalments of EUR 4,000;

 As from 1 August 2019 until 30 May 2020: EUR 45,000 to be paid in 10 monthly instalments of EUR 4,500;

 If the club wins the Cypriot First Division in 2018-2019 or 2019-2020: EUR 20,000 net;

 If the club wins the “Cup of the Cypriot First Division Champion OR finish at the 2nd or 3rd Position or any Other Europa League qualify position” in 2018-2019 or 2019-2020: EUR 10,000 net;

 The 2 bonuses above are not cumulative. The player only receives one, i.e. the highest.

 If the club’s defence “is in the top 5 after 1st round of the A phase of the Championship”: EUR 3,000;

 If the club’s defence “is in the top 5 after 2nd round of the A phase of the Championship”: EUR 5,000;

 For “every time team score first or clean sheet against top 6 teams (counts only in games in which the team won or draw)”: EUR 500

 For “every Win with TOP 6 teams of the season 2017/2018”: EUR 500;

 2 round trip tickets Larnaca-Tel Aviv for the season 2018/2019;

 Car “where the Employer will pay only the road tax and the regular mechanical services”: no more than EUR 2,000;

 Bonus of 10% “in any amount that the club will receive as transfer fee for the player” (only if player participated in at least 70% of the total matches of the team during the season);

 Free accommodation in 5 star-hotel or in a luxury apartment if his family joins him. Moreover, the Agency “will also pay for the player electricity and water (savings of 20. 000)”;

 Daily full meals for the player and his family “(savings of 15. 000)”.

7. The agreement also stipulated that the player would be free at the end of the 2018/2019 season if the club was relegated.

8. According to art. 14.2 of the agreement, CAS will be competent in case of a dispute: “If no agreement is reached, disputes will be settled by the Court of Arbitration for Sport (CAS) with its registered office in Lausanne, on the basis of the applicable regulations of the arbitration court”.

9. On 6 August 2020, the player put the club in default to pay the amount of EUR 17,500 corresponding to half the salary of March 2020 and the salaries of April and May 2020 within 10 days.

10. On 7 September 2020, the Claimant lodged a claim against the Respondent in front of FIFA and requested payment of EUR 17,500 “plus legal interest since each salary became due” as well as the imposition of sanctions as per art. 12bis.

11. In his claim, the player first stated that the only reason he agreed to conclude the agreement was that it was signed by the president of the club. The player alleged that he does not know the Agency and that all salaries as per the agreement were in reality paid by the club.

12. The player held that his aggregate remuneration, between the contract and the agreement, was EUR 7,000 per month.

13. Further, he argued that the club failed to pay him half of the salary of March 2020 and the salaries of April and May 2020, in the total amount of EUR 17,500.

14. In its reply, the club rejected the player’s claim, argued that the DRC has no jurisdiction to in connection with the agreement and that due to force majeure “both parties were discharged from their contractual obligations” in connection with COVID-19 and the measures implemented by the Cypriot government.

15. The Respondent stated that the Agency is not related to the club.

16. The club also mentioned that the Cypriot league was suspended on 13 March 2020 due to covid-19 and that the country was in lockdown as from 23 March 2020. On 15 May 2020, the Cypriot League decided to cancel all championships and cups.

17. The club confirmed that it paid all salaries to the player until 15 March 2020. For the period thereafter, the club stated that it “registered its employees to the Governmental Scheme of Subsidies. A third cheque is due for March. Therefore the player has received all the amount due according to the Governmental Scheme directly from the State”.

18. The club further considered that COVID-19 constitutes a force majeure and therefore the club should be “discharged from its contractual obligation regarding the period from 13th of March – May 2020”.

19. The club also relied on the doctrine of frustration given that it had no income and both the player and the club could not carry out their respective contractual obligations.

20. Moreover, the club held that the DRC does not have jurisdiction to decide on the “merchandise image agreement” as “there is no evidence relating to the private limited company with the Club. Further it is evident that Club and said Company are distinct legal entities and the Club is not at all liable for any of the Company’s outstanding obligations if any.” Furthermore, the club considered that it constitutes an image right and thus does not form part of the employment relationship.

II. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER

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 7 September 2020 and 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 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 October 2020), the Dispute Resolution Chamber would, in principle, be competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension. However, the Chamber took note that the Respondent denied FIFA’s jurisdiction on the agreement.

3. In continuation, with regard to the claimed payments in connection to the agreement apparently signed by the parties, the Chamber also had to verify whether, for formal reasons, it was competent to deal with this specific component or not. In fact it remains that this part of the claim could possibly not be considered due to the Chamber lacking competence to deal with disputes related to image rights.

4. As a general rule, if there are separate agreements, the DRC tends to consider the agreement on image rights as such and does not have the competence to deal with it. However, such conclusion might be different if specific elements of the separate agreement suggest that it was in fact meant to be part of the actual employment relationship.

5. In casu, the majority of the Chamber wished to highlight that the agreement contains elements which led to believe that it was not in fact an image rights contract per se but rather a separate agreement to the employment contract, i.e. directly linked to the services of the Claimant as a player. In particular, the agreement has the same duration as the contract. Moreover, the agreement contains stipulations regarding bonuses related to the performance of the team, accommodation, the use of a car and flights tickets, which are typical for employment contracts and not for image rights agreements. The members of the Chamber pointed out that the documents on file clearly establish a direct link to the club as the the payments resulting from the agreement were paid from the club’s account.

6. In view of the above, the majority of the Chamber established that the agreement was in fact meant to be an integral part of the actual employment relationship, in the sense that it was directly linked to the services of the Claimant as an employee of the Respondent. Therefore, the majority of the Panel decided that such agreement was to be regarded as a supplementary agreement to the employment contract, meaning that the DRC was in a position to take said image rights contract into consideration when assessing the Claimant’s claim.

7. In continuation, the Chamber analysed which regulations 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 2 of the Regulations on the Status and Transfer of Players (October 2020 edition), and considering that the claim was lodged on 7 September 2020, the August 2020 edition of the aforementioned regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance

8. 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.

9. 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.

10. First of all, the members of the Chamber acknowledged that, on 23 July 2018, the player and the club had concluded an employment contract as well as an agreement valid as from the date of its signature until 31 May 2020 and according to which the Claimant was entitled to an aggregate monthly salary of 7,000 (EUR 2,500 + EUR 4,500) during the 2019/2020 season.

11. Further, the Chamber duly noted that the Claimant lodged a claim against the Respondent requesting payment of EUR 17,500, corresponding to outstanding remuneration from the months of March 2020 (EUR 3,500), April 2020 (EUR 7,000) and May 2020 (EUR 7,000).

12. On account of the above, the DRC turned its attention to the arguments of the Respondent, who alleged that due to force majeure “both parties were discharged from their contractual obligations” in connection with COVID-19 and the measures implemented by the Cypriot government.

13. Having said that, the Chamber wished to refer to the fact that, in light of the worldwide COVID-19 outbreak, FIFA issued a set of guidelines, the COVID-19 Guidelines, which aim at providing appropriate guidance and recommendations to member associations and their stakeholders, to both mitigate the consequences of disruptions caused by COVID-19 and ensure that any response is harmonised in the common interest. Moreover, on 11 June 2020, FIFA has issued an additional document, referred to as FIFA COVID-19 FAQ, which provides clarification about the most relevant questions in connection with the regulatory consequences of the COVID-19 outbreak and identifies solutions for new regulatory matters.

14. For this dispute. it is important to note that based on the COVID-19 Guidelines, as well as the FIFA FIFA COVID-19 FAQ, the COVID-19 outbreak is not a force majeure situation in any specific country or territory. What is more, the COVID-19 Guidelines do not exempt an employer from paying a player’s salary.

15. In this context, the DRC considered that the arguments raised by the Respondent cannot be considered a valid reason for non-payment of the monies due to the player, in other words, the reasons brought forward by the Respondent in its defence do not exempt the Respondent from its obligation to fulfil its contractual obligations towards the Claimant.

16. On account of the aforementioned considerations, the Chamber established that the Respondent failed to remit to the Claimant the total amount of EUR 17,500 corresponding the player’s partial salary of March 2020 and the salaries of April and May 2020.

17. Consequently, the members of the Chamber decided that, in accordance with the general legal principle of pacta sunt servanda, the Respondent is liable to pay to the Claimant outstanding remuneration in the total amount of EUR 17,500.

18. In addition, taking into consideration the Claimant’s request, the members of the Chamber decided to award the Claimant 5% interest p.a. on the amounts as of the respective due dates, i.e. the first day of the following month.

19. In addition, the Chamber established that the Respondent had delayed a due payment for more than 30 days without a prima facie contractual basis.

20. In continuation, taking into account the consideration under number II./19. above, the DRC referred to art.12bis par. 2 of the Regulations which stipulates that any club found to have delayed a due payment for more than 30 days without a prima facie contractual basis may be sanctioned in accordance with art. 12bis par. 4 of the Regulations.

21. The members of the Chamber established that by virtue of art. 12bis par. 4 of the Regulations he has competence to impose sanctions on the Respondent. Bearing in mind that the Respondent duly replied to the claim of the Claimant and in the absence of the circumstance of repeated offence, the Single Judge decided to impose a warning on the Respondent in accordance with art. 12bis par. 4 lit. a) of the Regulations.

22. In this connection, the DRC wished to highlight that a repeated offence will be considered as an aggravating circumstance and lead to more severe penalty in accordance with art. 12bis par. 6 of the Regulations.

23. 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.

24. 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.

25. Therefore, bearing in mind the above, the DRC 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.

26. Finally, the 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.

III. DECISION OF THE DISPUTE RESOLUTION CHAMBER

1. The claim of the Claimant, Boris Kleyman, is accepted.

2. The Respondent, Enosis Neon Paralimniou FC, has to pay to the Claimant, the following amounts:

- EUR 3,500 as outstanding remuneration plus 5% interest p.a. as from 1 April 2020 until the date of effective payment.

- EUR 7,000 as outstanding remuneration plus 5% interest p.a. as from 1 May 2020 until the date of effective payment.

- EUR 7,000 as outstanding remuneration plus 5% interest p.a. as from 1 June 2020 until the date of effective payment.

3. A warning is imposed on the Respondent.

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 amounts.

5. The Respondent shall provide evidence of payment of the due amounts 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. In the event that the amounts due, plus interest as established above are not paid by the Respondent within 45 days, as from the notification by the Claimant of the relevant bank details to the Respondent, the following consequences shall arise:

 1.

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. The aforementioned ban mentioned will be lifted immediately and prior to its complete serving, once the due amounts are paid.

(cf. art. 24bis of the Regulations on the Status and Transfer of Players). 2.

In the event that the payable amounts as per in this decision is 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 the FIFA Disciplinary Committee.

For the Dispute Resolution Chamber:

Emilio García Silvero

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).

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