F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2016-2017) – fifa.com – atto non ufficiale – Decision 15 December 2016

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 15 December 2016,

in the following composition:

Thomas Grimm (Switzerland), Deputy Chairman

John Bramhall (England), member

Mario Gallavotti (Italy), member

on the claim presented by the player,

Player A, Country B,

as Claimant

against the club,

Club C, Country D

as Respondent

regarding an employment-related dispute between the parties

I. Facts of the case

1. On 29 September 2014, the Player of Country B, Player A (hereinafter: the Claimant), and the Club of Country D, Club C (hereinafter: the Respondent), signed an employment contract valid from 30 September 2014 until 29 September 2017.

2. In accordance with the employment contract, the Claimant was inter alia entitled to receive total remuneration of USD 375,000 plus amenities, as follows:

a. USD 100,000 for the 2014/15 season:

i. USD 20,000 as “provider contract”;

ii. USD 8,000 per month for ten months payable at the end of each month.

b. USD 125,000 for the 2015/16 season,:

i. USD 25,000 as “provider contract”;

ii. USD 10,000 per month for ten months payable at the end of each month.

c. USD 150,000 for the 2016/2017 season:

i. USD 50,000 as “provider contract“;

ii. USD 10,000 per month for ten months payable at the end of each month.

d. A return flight between Country B and City E each season.

3. On 26 May 2016, the Claimant put the Respondent in default of the total amount of USD 124,000 pertaining to the payment due at the beginning of the 2015/16 season and allegedly unpaid salaries of 2014/15, as well as salaries running from October 2015 until May 2016. The Claimant set a ten-day time limit to cure the default.

4. On 7 June 2016, the Claimant notified the Respondent of the termination of the employment relationship between the parties. He did so on the basis of salaries and due payments in the total amount of USD 124,000 having remained unpaid in spite of the club having been put in default.

5. On 15 June 2016, the Claimant lodged a claim against the Respondent in front of FIFA requesting to be paid outstanding salaries and compensation for breach of contract as follows:

a. USD 134,000 as outstanding remuneration:

i. USD 19,000 pertaining to unpaid salaries of May 2015 (in the amount of USD 3,000) as well as June and July 2015 (in the amount of USD 16,000);

ii. USD 25,000 as the payment due at the beginning of the 2015/16 season;

iii. USD 90,000 pertaining to salaries due from October 2015 until June 2016.

b. USD 150,000 as compensation for breach.

6. The Claimant claims to have had just cause to terminate the employment contract on 7 June 2016 on the basis that the Respondent had repeatedly failed to respect its obligations deriving from the employment contract.

7. In spite of having been invited to do so on 19 July 2016 by no later than 8 August 2016, the Respondent only replied on 10 August 2016 after the deadline set by the FIFA administration. The Respondent asserted that the Claimant had received all his dues relating to the first season barring the salary payment of September 2015 as well as the “provider contract”. The Respondent also stated that the Claimant had violated the terms of the contract, notably because, after having given the Claimant leave, he did not return to the club in order to participate in matches or training, in spite of having allegedly provided him with the relevant visa and travel documentation.

8. After the closure of the investigation phase of the present matter by the FIFA administration on 11 November 2016, the Respondent submitted additional unsolicited comments on 20 November 2016, reiterating its position presented after the deadline set by the FIFA administration in its correspondence of 19 July 2016.

9. In reply to FIFA’s pertinent request, the Claimant indicated that he had not found employment since the termination of the contract.

II. Considerations of the Dispute Resolution Chamber

1. First, the Dispute Resolution Chamber (hereinafter also referred to as Chamber or DRC) analysed whether it was competent to deal with the matter at hand. In this respect, it took note that the present matter was submitted to FIFA on 15 June 2016. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2015; hereinafter: the Procedural Rules) are applicable to the matter at hand (cf. art. 21 of the Procedural Rules).

2. Subsequently, the members of the Chamber referred to art. 3 par. 1 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 and par. 2 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players (2016 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 a Player of Country B and a Club of Country D.

3. Furthermore, 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 (2016 edition), and considering that the present claim was lodged on 15 June 2016, the 2016 edition of said 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 aforementioned facts as well as the arguments and the documentation submitted by the parties. The Chamber, however, emphasised that in the following considerations it will refer only to the facts, arguments and documentary evidence, which it considered pertinent for the assessment of the matter at hand.

5. In continuation, the members of the Chamber noted that the Claimant lodged a claim against the Respondent maintaining that he had terminated the employment contract with just cause on 7 June 2016, after previously having put the Respondent in default, since the Respondent allegedly failed to pay the Claimant’s remuneration. In this respect, the Claimant submits having not received the instalment due at the beginning of the 2015/16 season of USD 25,000, nor was he allegedly paid a portion of the salary of the month of May 2015, the entirety of the months of June and July 2015 in the amount of USD 19,000, as well as salaries due between October 2015 and May 2016 amounting to USD 80,000. Consequently, the Claimant asks to be awarded his outstanding dues as well as the payment of compensation for breach of the employment contract.

6. Subsequently, the Dispute Resolution Chamber noted that the Respondent, in spite of having been invited to do so, had, for its part, failed to present its response to the claim of the Claimant within the relevant time limit set by the FIFA administration, i.e. 8 August 2016. In fact, the reply was only received on 10 August 2016. Furthermore, the DRC noted that Respondent also provided an unsolicited submission in reply to the claim on 20 November 2016 after the notification of the closure of the investigation phase of the present matter, i.e. 11 November 2016. As a result, bearing in mind the Chamber’s constant jurisprudence in this regard and in application of art. 9 paras. 3 and 4 of the Procedural Rules, the Chamber decided not to take into account the reply of the Respondent nor its unsolicited submission and established that in accordance with the aforementioned provision, it shall take a decision on the basis of the statements and documents presented by the Claimant.

7. Having said this, the Chamber acknowledged the claim of the Claimant and noted that in accordance with the employment contract signed between the parties on 29 September 2014, the Claimant was inter alia entitled to receive monthly remuneration of USD 8,000 per month for ten months during the 2014/15 sporting season, an instalment of USD 25,000 at the beginning of the 2015/16 sporting season and USD 10,000 per month in ten instalments for the same season.

8. On account of the aforementioned observations, in particular in light of the considerations to be found under points II. 6 and II. 7 above, the Chamber decided that the Respondent, without any valid reason, failed to remit to the Claimant, until 7 June 2016, i.e. the date on which the Claimant terminated the contract, the total amount of USD 124,000. The Chamber remarked that this corresponds to outstanding remuneration for the partial month of May 2015 in the amount of USD 3,000, the entirety of the months of June and July 2015 totalling USD 16,000, the instalment due at the beginning of the season 2015/16 of USD 25,000 and salaries due between October 2015 and May 2016 totalling USD 80,000.

9. Consequently, and considering that the Respondent had repeatedly and for a significant period of time been in breach of its contractual obligations towards the Claimant, the Chamber decided that the Claimant had just cause to unilaterally terminate the employment contract on 7 June 2016 and that, as a result, the Respondent is to be held liable for the early termination of the employment contract with just cause by the Claimant.

10. In continuation, having established that the Respondent is to be held liable for the early termination of the employment contract with just cause by the Claimant, the Chamber focused its attention on the consequences of such a termination. In this regard, the members of the Chamber determined that the Respondent was not only to pay the amount of USD 124,000 as outstanding remuneration to the Claimant, but also to pay compensation for breach of contract in conformity with art. 17 par. 1 of the Regulations.

11. Having stated the above, the Chamber turned to the calculation of the amount of compensation payable to the Claimant by the Respondent in the case at stake. In doing so, the members of the Chamber first 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.

12. In application of the relevant provision, the Chamber held that it first had to clarify as to whether the pertinent employment contract contains a provision by means of which the parties had beforehand agreed on 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.

13. As a consequence, the members of the Chamber determined that the amount of compensation payable by the Respondent to the Claimant had to be assessed in application of the other parameters set out in art. 17 par. 1 of the Regulations. 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.

14. Bearing the foregoing in mind, the Chamber proceeded with the calculation of the compensation due to the Claimant and, in this respect, it recalled that the latter is requesting the amount of USD 150,000, which will serve as a basis for the determination of the amount of compensation due for breach.

15. 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.

16. In this regard, the Dispute Resolution Chamber noted that according to the Claimant’s declaration, he had not signed any new employment contract within the period of time between the termination of the contract and its original date of expiry, and, therefore, had not been able to mitigate his damages.

17. Consequently, on account of all the aforementioned considerations and the specificities of the case at hand, in particular the fact that the employment contract would have run, had it not been for the breach, for another sixteen months, i.e. from June 2016 until September 2017, the members of the Chamber decided that the Respondent must pay the amount of USD 150,000 to the Claimant, which was to be considered a reasonable and justified amount of compensation for breach of contract in the present matter.

18. The members of the Dispute Resolution Chamber concluded their deliberations in the present matter by establishing that any further claim lodged by the Claimant is rejected.

III. Decision of the Dispute Resolution Chamber

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

2. The Respondent, Club C, has to pay to the Claimant outstanding remuneration in the amount of USD 124,000, within 30 days as from the date of notification of this decision.

3. The Respondent has to pay to the Claimant compensation for breach of contract in the amount of USD 150,000, within 30 days as from the date of notification of this decision.

4. In the event that the amounts due to the Claimant in accordance with the aforementioned numbers 2. and 3. are not paid by the Respondent within the stated time limits, interest at the rate of 5% p.a. will fall due as of expiry of the aforementioned time limits and the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee for consideration and a formal decision.

5. Any further claim lodged by the Claimant is rejected.

6. The Claimant is directed to inform the Respondent immediately and directly of the account number to which the remittances are to be made and to notify the Dispute Resolution Chamber of every payment received.

*****

Note relating to the motivated 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, a copy of which we enclose hereto. Within another 10 days following the expiry of the time limit for filing the statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the directives).

The full address and contact numbers of the CAS are the following:

Court of Arbitration for Sport

Avenue de Beaumont 2

1012 Lausanne

Switzerland

Tel: +41 21 613 50 00

Fax: +41 21 613 50 01

e-mail: info@tas-cas.org

For the Dispute Resolution Chamber:

Marco Villiger

Deputy Secretary General

Encl. CAS directives