F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2019-2020) – fifa.com – atto non ufficiale – Decision 20 February 2020

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 20 February 2020,

in the following composition:

Clifford Hendel (USA), Deputy Chairman

Roy Vermeer (The Netherlands), member

Daan De Jong (The Netherlands), member

on the claim presented by the player,

Denilson Gabionetta, Brazil & Italy

represented by Mr Nilo Effori and Ms Cintia R Nicolau

as Claimant / Counter-Respondent

against the club,

Zhejian Greentown FC, China PR

(formerly known as Hangzhou Greentown FC)

represented by Mr Yu Shengjie

as Respondent / Counter-Claimant

regarding an employment-related dispute between the parties

I. Facts of the case

1. On an unspecified date, the Brazilian and Italian player Denilson Gabionetta (hereinafter: the player or the Claimant / Counter-Respondent) and the Chinese club Zhejian Greentown FC, formerly known as Hangzhou Greentown FC (hereinafter: the club or the Respondent / Counter-Claimant) signed an employment contract valid as from 1 March 2016 until 31 December 2017.

2. According to clause 5 par. 1.1 of the contract, the player was entitled to receive an annual remuneration of USD 350,000 for the 2016 season.

3. In addition, as regards to the salary of the 2017 season, and pursuant to clause 5 par. 1.3 of the contract, the parties agreed that the player’s yearly salary would be determined as follows:

a) “If [the player] assists 10 times in the 2016 season, 2017 season Salary is [USD] 500,000”;

b) “If [the player does not assist] 10 times in the 2016 season, 2017 season Salary is [USD] 400,000”.

4. Pursuant to clause 8 par. 3.1, the parties agreed upon the following:

“In case of [the player]’s breaking the above discipline, [the club] shall inflict punishment according to natures and seriousness as regulated and meanwhile can determine fine within the range of 50% of [the player]’s salary”.

5. Additionally, clause 8 par 3.3 of the contract established the following:

“In case of [the player]’s serious breach of discipline and causing great damage to [the club]’s interest or reputation and being in line with the cancellation clause of the contract, the contract will be cancelled”.

6. As per the Claimant / Counter-Respondent, after the expiration of the contract on 31 December 2017, the salaries for January and February 2017 were still outstanding to him, amounting a total debt of USD 66,666.

7. In this context, on 9 January 2019, the Claimant / Counter-Respondent allegedly put the Respondent in default of payment of USD 66,666, setting a 10 days’ deadline to remedy the situation.

8. On 21 January 2019, the player lodged a claim against the Respondent / Counter-Claimant before FIFA and requested the following:

a) USD 66,666, corresponding to the monthly salaries for January and February 2017;

b) To be awarded 5% interest p.a. “on the outstanding compensation amount”.

9. In his claim, the Claimant / Counter-Respondent sustained that the Respondent / Counter-Claimant had committed itself to pay to the player an annual salary of USD 400,000.

10. Furthermore, according to the Claimant / Counter-Respondent’s claim, the club “without any valid reason, did not pay his salaries of January and February 2017”.

11. In its reply to the claim, the Respondent / Counter-Claimant rejected the player’s arguments and filed a counterclaim against the player on 21 March 2019 for having been absent “without just cause” as “from 1 December 2016 until 18 January 2017”. In this context, according to the provision contained in clause 8 par. 3.3 of the contract, the Respondent pointed out that the player “committed a serious breach of the contract and therefore, the Club was fully entitled to terminate the employment relationship”.

12. According to the Respondent / Counter-Claimant, notwithstanding the provisions under clause 8 par 3.3 of the contract, “the Club preferred to open disciplinary proceedings, which offered guarantee to the right to be heard of the Player, and then decided to suspend the payment of the salary for the period of absence”. In this regard, as per the club, it decided to withhold the player’s salary based on the stipulations provided under clause 5 par. 3 of the contract, which established the following: “In case that those resulted from breach of law, breach of discipline and violation of social ethics and other misbehaviour, [the club] shall not pay [the player] the salary”.

13. In this context, the Respondent / Counter-Claimant explained that it “preferred to apply other and less heavy disciplinary measures such as the [non-payment] of the salary for the period of the unjustified absence and the fine of 49,000 USD in compliance with clauses 4, 5, and 8 of the Employment Contract”. As regards the fine of USD 49,000 and the non-payment of the player’s salaries, the Respondent / Counter-Claimant sustained that this was “not contradictory because they are different in nature”.

14. Furthermore, with regard to the imposition of the fine in the amount of USD 49,000, the Respondent / Counter-Claimant considered it “proportionate, fair and legitimate” for the following reasons: (i) “the Club could terminate the contract in accordance with the relevant FIFA and CAS jurisprudence and decided not to do it”; (ii) “the fine itself did not deprive the Player from his basic needs”; and (iii) “the Player was informed of the entire disciplinary proceedings and he did not show any interest in informing the Club on the reasons of his absence prior, during and after the proceedings”.

15. In this context, the Respondent / Counter-Claimant stated that, on 21 January 2017, within the framework of the club’s disciplinary proceedings, the player was duly informed of the imposition of the above-mentioned fines. In support of its statements, the club provided a copy of the “Notice of penalties to Italian Denilson Gabionetta” allegedly sent to the Claimant / Counter-Respondent.

16. In addition, the Respondent / Counter-Claimant maintained that it had booked a flight ticket for 4 December 2016. In this regard, the Respondent / Counter-Claimant pointed out the following: “the Player’s total ignorance of the 4 December 2016 return flight and the club’s phone call, SMS as well as messages from his agent company clearly show that the Player did not want to return to the Club on time”.

17. Finally, the Respondent / Counter-Claimant requested the Claimant / Counter-Respondent’s claim to be dismissed and sustained that the player had “acted in procedural bad faith”. Therefore, the Respondent / Counter-Claimant requested that the player shall bear the legal costs in the amount of CNY 80,000, plus 5% interest p.a. as from 4 March 2019 until the date of payment.

18. As to the counterclaim, the Claimant / Counter-Respondent acknowledged having been absent as from 1 December 2016 until 18 January 2017, i.e. 49 days, however, he maintained having been “in contact with the Respondent/Counter-Claimant […] between 28 November 2016 [until] 10 January 2017”. In support of his statements, the player provided a copy of the conversations exchanged with the club.

19. Moreover, the player provided a copy of his “Medical Certificate”, dated 30 November 2016, according to which the player “should be in bed rest for 18 (eighteen) days as of today”, i.e. until 18 December 2016. In this regard, the player maintained that he was diagnosed with dengue, so he had been “prevented from travelling at least until 19 December 2016”.

20. Furthermore, the Claimant / Counter-Respondent sustained that, on 28 November 2016 and 9 January 2017, the player requested the club to be provided with a return flight ticket for 4 January 2019. However, as per the player, the flight ticket “was only issued by the Respondent/Counter-Claimant for 17 January 2019”. In this context, the player maintained that “the delay for the issuance of the flight ticket […] was entirely […] the Respondent/Counter-Claimant’s fault”.

21. Subsequently, as regards the penalty imposed on the Claimant / Counter-Respondent, the player underlined that he “never accepted the amount of the imposed penalty by signing the receipt”, as he considered it “excessive” and disproportionate.

22. First of all, as per the player, taking into account that the Respondent / Counter-Claimant disregarded the player’s request to be provided with a flight ticket for 4 January 2017, and considering that the club imposed a fine of USD 4,900 per each day of absence, i.e. a total amount of USD 49,000, the player underlined that the club had “directly contributed to at least thirteen (13) extra days, i.e. 4 to 17 January 2017”.

23. Secondly, the Claimant / Counter-Respondent also highlighted the content of clause 8 par. 3.1, according to which disciplinary sanctions were limited to a 50% of the player’s salary. Having said this, the player wished to emphasised that the amount of USD 49,000, i.e. the fine imposed by the club, represented “around 149% of the Claimant/Counter-Respondent’s salary for 2017 season”.

24. Furthermore, the player also maintained that the club had added “an extra penalty of USD 29,000”, corresponding to the player’s salary for December 2016. Therefore, the imposed sanction represented “around 236%” of the Claimant / Counter-Respondent’s salary.

25. In continuation, with regard to the fact that the club withheld the monthly salaries for December 2016, January and February 2017, as well as part of the salary for March 2017, the Claimant / Counter-Respondent sustained having sent a default letter on 28 April 2017. In support of his statements, the Claimant / Counter-Respondent provided a letter according to which he put the Respondent / Counter-Claimant in default of payment of USD 116,066.

26. In view of the above, the Claimant / Counter-Respondent amended his original claim and requested the following:

a) The Respondent / Counter-Claimant’s counterclaim to be rejected;

b) To determined that the fine imposed on the Claimant / Counter-Respondent was excessive and that the maximum applicable amount of USD 16,500 was duly paid by the Claimant / Counter-Respondent with the withholding of his salary for December 2016;

c) To determine that the salaries of January and February 2017 were withheld by the Respondent / Counter-Claimant “in abuse of its rights and therefore such salaries are outstanding”;

d) To order the club to pay to the player the total amount of USD 68,155, plus 5% interest p.a., corresponding to the following:

- USD 33,000 “as outstanding salary of the month of January 2017”;

- USD 33,000 “as outstanding salary of the month of February 2017”;

- USD 2,155 as part of the monthly salary for March 2017.

27. After the closure of the investigation, by means of an unsolicited correspondence dated 11 February 2020, the Respondent / Counter-Claimant wished to point out inter alia that the player had allegedly “added many false statements on many key facts”. In this respect, the Respondent / Counter-Claimant held that all the evidences submitted by the player on 25 November 2019 had been allegedly “manipulated” and several exhibits, such as the medical certificate and the default letter dated 28 April 2020, had been “forged”.

II. Considerations of the Dispute Resolution Chamber

1. First of all, the Dispute Resolution Chamber (hereinafter: the DRC or the Chamber) analysed whether it was competent to deal with the case at hand. In this respect, it referred to the wording of art. 21 of the 2019 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules) as well as to the fact that the present matter was submitted to FIFA on 21 January 2019 and decided on 20 February 2020. Therefore, the Chamber concluded that the 2019 edition of the Procedural Rules is applicable to the matter at hand.

2. Furthermore, the DRC 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, and considering that the present claim was lodged on 21 January 2019, the June 2018 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

3. Subsequently, the members of the Chamber referred to art. 3 par. 1 and 2 of the Procedural Rules and confirmed that, in accordance with art. 24 par. 1 and 2 in combination with art. 22 lit. b of the Regulations, the Dispute Resolution Chamber is competent to adjudicate on the present employment-related dispute between a Brazilian and Italian player and a Chinese club.

4. The competence of the Chamber and the applicable regulations having been established, and entering into the substance of the matter, the Chamber started by acknowledging the above-mentioned facts as well as the documentation contained in the 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.

5. First of all, the Chamber acknowledged that the Claimant / Counter-Respondent and the Respondent / Counter-Claimant entered into an employment contract valid as from 1 March 2016 until 31 December 2017, i.e. corresponding to the 2016 and 2017 seasons, which entitled the Claimant to the following remuneration:

a) An annual remuneration of USD 350,000 for the 2016 season;

b) An annual remuneration of USD 400,000 for the 2017 season.

6. Furthermore, as regards the remuneration for the 2017 season, the Chamber wished to highlight that it remained undisputed that the player was entitled to receive a monthly salary of USD 33,000.

7. In continuation, the DRC further observed that the Claimant / Counter-Respondent lodged a claim in front of FIFA against the Respondent / Counter-Claimant seeking payment of the amount of USD 68,155, indicating that the Respondent / Counter-Claimant had “wrongfully withheld” the monthly salaries for December 2016, January 2017 and February 2017 and part of the monthly salary for March 2017.

8. Moreover, the DRC acknowledged that the Respondent / Counter-Claimant, for its part, was of the opinion that the Claimant / Counter-Claimant breached the contract “by failing to report to work from 1 December 2016 to 18 January 2017”. In this context, the Chamber observed that due to the player’s alleged “unjustified absence”, the Respondent / Counter-Claimant deemed appropriate to impose the following disciplinary sanctions: (i) the payment of a fine in the amount of USD 49,000; and (ii) the non-payment of the salaries “for the period of absence”.

9. In this context, taking into account the parties’ arguments, the members of the Chamber established that the main issue at stake was determining whether the Respondent / Counter-Claimant’s disciplinary sanctions imposed on the Claimant / Counter-Respondent had been imposed proportionally and justifiably.

10. First of all, as regards to the absence of the player, the members of the Chamber acknowledged that the Claimant / Counter-Respondent submitted a medical report dated 30 November 2016, according to which the doctor prescribed bed rest for the following 18 days, i.e. until 18 December 2016.

11. In addition, the DRC further acknowledged that the Claimant / Counter-Respondent had duly put the Respondent / Counter-Claimant in default on 28 April 2019.

12. As regards the club’s disciplinary sanctions against the player, the members of the Chamber turned their attention to the content of clause 8 par. 3 of the contract (cf. point I.4. above), according to which the fines imposed on the player could not exceed 50% of the player’s salary. Therefore, the DRC deemed that the disciplinary measures imposed by the club were already covered by the non-payment of the player’s monthly salary for December 2016, in the amount of USD 16,500.

13. In view of all the aforementioned, the members of the Chamber deemed that the club did not sufficiently substantiate its response to the Chamber’s satisfaction, as it did not present any conclusive documentary evidence which could corroborate that the salaries from January 2017 until March 2017 had been withheld in a “proportionate” and “fair” way. Taking into account that the monthly salary for December 2016 had already been deducted (cf. see point II.12. above), and according to the stipulations provided under clause 8 par. 3 of the contract, the Chamber emphasised that withholding the monthly salaries for January 2017, February 2017 and part of the monthly salary for March 2017, amounting to the total amount of USD 68,155, for allegedly being unjustifiably absence, is excessive and disproportionate and cannot be upheld.

14. In addition, and irrespective of the foregoing considerations, the DRC wished to address the fact that the imposition of a fine, or any other available financial sanction in general, shall not be used by clubs as a method to set off outstanding financial obligations towards players.

15. In this context, in view of the aforementioned considerations, the members of the Chamber unanimously concluded that the player’s salaries for January 2017, February 2017 and part of the monthly salary for March 2017 were outstanding to the player.

16. Consequently, the DRC decided to partially accept the Claimant / Counter-Respondent´s claim and determined that the Respondent / Counter-Claimant must pay to the player the total amount of USD 68,155 as outstanding remuneration, corresponding to the following:

a) USD 33,000 as the monthly remuneration for January 2017;

b) USD 33,000 as the monthly remuneration for February 2017;

c) USD 2,155 as the remainder of the March 2017 salary.

17. In addition, taking into account the player’s request, the Chamber further decided that the club must pay to the player an interest at the rate of 5% p.a. on the amount of USD 68,155 as from 25 November 2019 until the date of effective payment.

18. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claim lodged by the Claimant / Counter-Respondent is rejected.

19. The DRC concluded its deliberations in the present matter reiterating that the claim of the Claimant / Counter-Respondent is partially accepted and, at the same time, establishing that the counterclaim of the Respondent / Counter-Claimant is rejected.

20. Furthermore, taking into account the consideration under number III.6. 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 in due time.

21. 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.

22. Therefore, bearing in mind the above, the DRC decided that, in the event that the Respondent / Counter-Claimant does not pay the amounts due to the Claimant / Counter-Respondent within 45 days as from the moment in which the Claimant / Counter-Respondent, following the notification of the present decision, communicates the relevant bank details to the Respondent / Counter-Claimant, 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 / Counter-Claimant in accordance with art. 24bis par. 2 and 4 of the Regulations.

23. Finally, the Chamber recalled that the above-mentioned sanction 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 / Counter-Respondent, Denilson Gabionetta, is partially accepted.

2. The Respondent / Counter-Claimant, Zhejian Greentown FC (formerly known as Hangzhou Greentown FC), has to pay to the Claimant / Counter-Respondent outstanding remuneration in the amount of USD 68,155 plus 5% interest p.a. as from 25 November 2019 until the date of effective payment.

3. Any further claim by the Claimant / Counter-Respondent is rejected.

4. The counterclaim of the Respondent / Counter-Claimant is rejected.

5. The Claimant / Counter-Respondent is directed to inform the Respondent / Counter-Claimant, immediately and directly, preferably to the e-mail address as indicated on the cover letter of the present decision, of the relevant bank account to which the Respondent / Counter-Claimant must pay the amount mentioned under point III.2. above.

6. The Respondent / Counter-Claimant shall provide evidence of payment of the due amount plus interest in accordance with point III.2. above to FIFA to the e-mail address psdfifa@fifa.org, duly translated, if need be, into one of the official FIFA languages (English, French, German, Spanish).

7. In the event that the amount due plus interest in accordance with point III.2. above is not paid by the Respondent / Counter-Claimant within 45 days as from the notification by the Claimant/ Counter-Respondent of the relevant bank details to the Respondent / Counter-Claimant, the Respondent / Counter-Claimant shall be banned from registering any new players, either nationally or internationally, up until the due amount is not paid and for the maximum duration of three entire and consecutive registration periods (cf. art. 24bis of the Regulations on the Status and Transfer of Players).

8. The ban mentioned in point III.7. above will be lifted immediately and prior to its complete serving, once the due amount is paid.

9. In the event that the aforementioned sum plus interest 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 FIFA’s Disciplinary Committee for consideration and a formal decision.

*****

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. 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:

Emilio García Silvero

Chief Legal & Compliance Officer