F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2018-2019) – fifa.com – atto non ufficiale – Decision 15 November 2018

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 15 November 2018,

in the following composition:

Geoff Thompson (England), Chairman

Roy Vermeer (The Netherlands), member

Johan van Gaalen (South Africa), member

Wouter Lambrecht (Belgium), member

Pavel Pivovarov (Russia), 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

arisen between the parties

I. Facts of the case

1. On 20 September 2016, the Player of Country B, Player A (hereinafter: the Claimant or the player), and the Club of Country D, Club C (hereinafter: the Respondent or the club), signed an employment contract (hereinafter: the contract) valid as from its date of signature until 31 May 2018.

2. According to Schedule 1 of the contract, the Respondent committed to pay the Claimant a salary of USD 1,500 “per each calendar month” and to provide him with “transport & house”.

3. Article 7, par. 3 of the contract stipulates that “when the termination of the contract is not due to a just cause or a mutual agreement between the parties concerned, the club and the player shall be entitled to receive from the other party in breach of the contract a compensation for a net amount of:

- to the club: one month basic salary

- to the player: not applicable”.

4. Article 10 of the contract provides that “(…) the provisions of Labour Law of Country D shall be applicable on any matter not provided for in this contract or Football Association of Country D or League E regulations”.

5. On 15 September 2017, the Respondent sent a letter to the Claimant whereby it notified him his unjustified absence from the team’s trainings on 14 September 2017. Moreover, the Respondent informed the Claimant that 50 were deducted from his salary “due to this misconduct”.

6. On 4 December 2017, the Claimant put the Respondent in default of payment of USD 8,000, allegedly corresponding to three not specified monthly salaries, and set a 7 days’ deadline in order to remedy the default.

7. On 10 January 2018, the Claimant sent a letter to the Respondent, by means of which he terminated the contract with immediate effect.

8. On 24 April 2018, the player lodged a claim against the club for breach of contract in front of FIFA, requesting the payment of USD 19,000, broken-down as follows:

a) USD 4,500 as outstanding salaries for the months of June, July and December 2017, plus 5% interest p.a.:

- on USD 1,500 as of 1 July 2017;

- on USD 1,500 as of 1 August 2017;

- on USD 1,500 as of 1 January 2018.

b) USD 10,000 as compensation for breach of contract corresponding to the remaining value of the contract, namely 5 months as from January until May 2018, plus 5% interest p.a. as of 11 January 2018 (based on an alleged monthly remuneration of USD 2,000, where USD 1,500 are for the salary and USD 500 are the estimated value of a housing allowance);

c) USD 3,500 for a sign-on fee allegedly agreed with the club verbally, plus 5% interest p.a. as of the alleged due date, 1 October 2016;

d) USD 1,000 as additional compensation provided by the Labour Law of Country D, corresponding to half of a monthly salary, plus 5% interest p.a. as of 11 January 2018.

Furthermore, the player requested the imposition of sporting sanctions on the club.

9. In his claim, the Claimant maintained that, despite he put the Respondent in default of payment of three monthly salaries and of a sign-on fee verbally agreed with the club, he did not receive the requested payment. Consequently, he argued that he terminated the contract with just cause due to the Respondent’s failure to comply with its payment obligations for an amount corresponding to more than three monthly salaries.

10. In its reply, the Respondent affirmed that it paid the Claimant all the amounts due to him, as follows:

i) for season 2016/2017, 6,110 and USD 4,500. In this regard, the Respondent submitted a payment receipt, dated 29 May 2017, whereby the Claimant acknowledged having received “all [his] deserving for season 2016/2017” and that he had “no right to ask the club for and demands”;

ii) for season 2017/2018, 2,360. Nevertheless, for this season the Respondent submitted payment receipts for the amount of 1,590 only.

11. Moreover, the Respondent affirmed that the Claimant left Country D on 29 November 2017 in order to join his national team for a tournament and never came back. In this context, the Respondent provided correspondence exchanged between the club and the Country B Football Federation, by means of which the player was released for the period between 29 November and 17 December 2017.

12. In his replica, the Claimant denied that the Respondent had paid all the outstanding remuneration and compensation for breach of contract and argued that, in the list of the payments submitted by the club (cf. point 10 above) – even though the player, “does not confirm that such payments were made” – it was confirmed that no payments were made for the salaries of June, July 2017 and as from December 2017.

13. In its duplica, the Respondent insisted on the position illustrated in its reply to the claim.

14. Upon request of FIFA to be informed about the player’s employment situation during the period between 10 January and 31 May 2018, the Claimant informed that he did not play and was not paid “because the [club] did not release his ITC”.

15. According to the information contained in the TMS, on 12 December 2017, the Claimant entered into an employment contract with the Club of Country B, Club E valid as from its date of signature until the end of season 2019/2020. Pursuant to this new contract, the player was entitled to a sign-on fee of 10,000,000 and a monthly salary of 2,000,000.

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 matter at hand. In this respect, it took note that the present matter was submitted to FIFA on 24 April 2018. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2018; hereinafter: 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 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players (edition 2018), 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. In continuation, 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 (edition 2018), and considering that the present claim was lodged on 24 April 2018, the 2018 edition of said regulations (hereinafter: 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.

5. First, the Chamber noted that the parties entered into an employment contract valid as of 20 September 2016 until 31 May 2018, which entitled the Claimant to a monthly salary of USD 1,500.

6. In continuation, the DRC took note that, on 4 December 2017, the Claimant put the Respondent in default of the amount of USD 8,000, allegedly corresponding to three monthly salaries of season 2017/2018, granting the Respondent seven days in order to remedy the default.

7. Furthermore, the DRC acknowledged that it remained undisputed that the Claimant, on 10 January 2018, sent a letter to the Respondent, by means of which he terminated the contract.

8. After having taken note of the above, the DRC also took note of the position of the parties in the present matter. First, the Claimant affirmed that, on the date he terminated the contract, the equivalent of more than three monthly salaries were unpaid by the Respondent and, thus, he argued that the he terminated the contract with just cause.

9. Equally, the members of the Chamber took note of the position of the Respondent which, conversely, maintained that it made all the payments due in accordance with the contract.

10. Moreover, the Respondent affirmed that the Claimant left at the end of November 2017 with the club’s authorisation to play a tournament with his national team until 17 December 2017, but he eventually did not return to the club. In this regard, the DRC acknowledged that such circumstance remained undisputed by the Claimant.

11. In view of the foregoing considerations, the Chamber deemed that the underlying dispute in the matter at hand was whether the relevant employment contract had been terminated by the Claimant with or without just cause and, depending on this finding, it would have to determine which would be the potential consequences of said termination.

12. In this context, the members of the Chamber went on to analyse the Respondent’s line of defence and, in particular, the alleged payments it made to the Claimant (cf. point I.10. above). In this regard, the members of the DRC noted that the payment receipts submitted by the Respondent related to season 2017/2018 cover a total amount of 1,590, which approximately corresponds to USD 4,100.

13. With the above in mind, the DRC recalled the basic principle of burden of proof, as established in art. 12 par. 3 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.

14. In view of the above-mentioned considerations, the DRC concluded that, despite the player did not contest the above-mentioned payment receipts submitted by the Respondent, nevertheless such receipts only covered part of the monthly salaries provided in the contract, but not those requested by the Claimant, namely the salaries for the months of June, July and December 2017. In other words, the payment receipts submitted by the Respondent cannot possibly relate to the salaries requested by the Claimant. Thus, as a consequence thereof, the Chamber decided to reject the argument of the Respondent in this regard.

15. However, the members of the Chamber wished to emphasise that, as it remained undisputed that the Claimant did not return to the club after the expiry date of his authorisation to play with his national team (i.e. 17 December 2017), the player did not render his services to the Respondent during half of the month of December 2017, without the club’s authorisation. Consequently, the members of the Chamber concluded that, for such month, the player was entitled to a half of his monthly salary only, namely to USD 750.

16. On account of the above-mentioned considerations, and considering that the Respondent did not invoke any other reason to justify the non-payment of the Claimant’s salaries, the Chamber deemed that the Respondent failed to pay in due time the Claimant’s salary for the months of June, July and half of December 2017 without any valid reason and, therefore, it could be established that the Respondent had seriously neglected its contractual obligations towards the Claimant in a continuous manner and for a significant period of time.

17. In view of the above, and taking into consideration the Chamber’s longstanding jurisprudence in this respect, the DRC decided that the Claimant had just cause to unilaterally terminate the employment contract and that, as a result thereof, the Respondent is to be held liable for the early termination of the employment contact with just cause by the Claimant.

18. In continuation, having established the above, the Chamber focused its attention on the consequences of such contractual termination. In this regard, in accordance with the general legal principle of pacta sunt servanda, the Chamber decided that the Respondent is liable to pay to the Claimant the amounts which were outstanding under the contract at the moment of the termination, i.e. USD 3,750 corresponding to the salaries for the months of June, July and half of December 2017.

19. In this context, as to the Claimant’s request for the payment of an alleged outstanding sign-on fee verbally agreed between the parties, the DRC stressed that, in accordance with the aforementioned principle under art. 12 par. 3 of the Procedural Rules, it would had been up to the Claimant to demonstrate the existence of such verbal agreement. Nevertheless, as the Claimant did not submit any evidence in support of his allegation, the members of the Chamber had no other option than to reject that part of the player’s claim.

20. In addition, taking into consideration the Claimant’s request as well as the constant practice of the Dispute Resolution Chamber in this regard, the members of the Chamber decided to award the Claimant interest on the above-mentioned amount of USD 3,750 as follows:

a) as of 1 July 2017, on the amount of USD 1,500;

b) as of 1 August 2017, on the amount of USD 1,500;

c) as of 1 January 2018, on the amount of USD 750.

21. In continuation, the Chamber decided that, in accordance with art. 17 par. 1 of the Regulations, the Respondent would be liable, in principle, to pay compensation for breach of contract to the Claimant. In this regard, the Chamber pointed out that, according to said art. 17 par. 1, in all cases the party in breach shall pay compensation.

22. In application of the aforementioned provision, the Chamber recalled that 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.

23. Furthermore, the Chamber held that it first of all had to clarify as to whether the pertinent employment contract and the private agreement contain 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 recalled that, according to art. 7 par. 3 of the contract, in case of termination of the contract without just cause, “the club and the player shall be entitled to receive from the other party in breach of the contract a compensation for a net amount of:

- to the club: one month basic salary

- to the player: not applicable”.

24. Notwithstanding the above, the Chamber wished to emphasise that the player found a new club on 12 December 2017, which means before he terminated his contract with the Respondent. Consequently, the member of the Chamber concurred on the fact that, by concluding a new employment contract before terminating the contract with the Respondent, the Claimant clearly showed no interest in the continuation of the employment relationship with the Respondent.

25. As a consequence of the aforementioned considerations, and in view of the very specific circumstances of the present matter, the Chamber determined that it would not be fair and reasonable in the present matter to award any compensation for the breach of contract to the Claimant. What is more, the members of the Chamber were comforted with such conclusion by the fact that, prior to the termination of the contract with the Respondent, the Claimant was able avoid any potential financial loss, by signing a new contract with the Club of Country B, Club E.

26. The members of the Chamber concluded their deliberations by rejecting any further claim of the Claimant.

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, within 30 days as from the date of notification of this decision, outstanding remuneration in the amount of USD 3,750, plus 5% interest p.a. until the date of effective payment, as follows:

a. as of 1 July 2017, on the amount of USD 1,500;

b. as of 1 August 2017, on the amount of USD 1,500;

c. as of 1 January 2018, on the amount of USD 750;

3. In the event that the aforementioned sum plus interest is not paid by the Respondent within the stated time limit, the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee for consideration and a formal decision.

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

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

*****

Note relating to the motivated decision (legal remedy):

According to article 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:

Omar Ongaro

Football Regulatory Director

Encl.: CAS directives