F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2020-2021) – fifa.com – atto non ufficiale – Decision 10 September 2020

Decision of the

Dispute Resolution Chamber

passed on 10 September 2020,

regarding an employment-related dispute concerning the player Nikola Stankovic

COMPOSITION:

Clifford J. Hendel (USA/France), Deputy Chairman MD Abu Nayeem Shohag (Bangladesh), member Michele Colucci (Italy), member

CLAIMANT:

Nikola Stankovic, Serbia

Represented by Emmanouil Alafragkis

RESPONDENT:

Larissa FC, Greece

Represented by Chrissa Sevastopoulou

I. FACTS OF THE CASE

1. On 13 August 2019, the Serbian player Nikola Stankovic (hereinafter: player or Claimant) and the Greek club, Larissa FC (hereinafter: club or Respondent) signed an employment contract (hereinafter: the contract) valid as of the date of signature until 30 June 2022.

2. Art. 4.1. of the contract establishes that “[i]t is hereby stipulated that the monthly fee of the Player – which in any case may not be lower that the monthly salary of an unskilled worker set out in the National Collective Bargaining Agreement – are set to the amount of 726,00 €, paid out to the Player by the Club the latest at the end of each month, twelve months per year. Apart from the aforementioned monthly fees, the Club is obligated to pay out to the Player Christmas bonus (the amount thereof being equal to the monthly fees of the Player) and Easter bonus (the amount thereof being half of the monthly fees of the Player), as well as Holiday benefit (the amount thereof being half of the monthly fees of the Player).”

3. According to art. 4.4. of the contract “[t]he Player shall receive the total amount of NET 135.000,00 € in 30 instalments “ payables at the end of each month, the first monthly salary payable on 30 September 2019 and the last one on 30 June 2022.

4. Art. 10 of the contract provides that: “All disputes between the parties are settled by the Appeals Committee for the Resolution of Financial Disputes (PEEOD) at first instance and the Court of Arbitration of the H.F.F. at second instance”.

5. The Claimant argued having sent several default notices to the Respondent, the last one was sent on 8 May 2020, by means of which he requested to be paid, within 15 days, the total amount of EUR 19,869.28 breakdown as follows:

Amount

Concept

EUR 3,855.88

Partial big salary January 2020

EUR 628.35

Small salary February 2020

EUR 4,500

Big salary February 2020

EUR 628.35

Small salary March 2020

EUR 4,500

Big salary March 2020

EUR 628.35

Small salary April 2020

EUR 4,500

Big salary April 2020

EUR 314,375

Easter bonus

EUR 314,175

Vacation bonus

6. Moreover, the Claimant maintained that as from 8 May 2020 the Respondent did not allow him to train with his teammates.

7. The Claimant explained that in accordance with the contract he was entitled to receive the following remuneration from the Respondent:

 Monthly small salary amounting to EUR 726 gross equivalent to EUR 628.35 net;

 Additional monthly small salary as Christmas bonus;

 EUR 314,175 net as Easter bonus;

 EUR 314,175 net as holiday bonus;

 EUR 135,000 net as big salary payable in monthly instalments amounting to EUR 4,500 each.

8. In particular, the Claimant requested FIFA to consider the contract terminated with just cause on the date of lodging the present claim, i.e. 24 May 2020.

9. On 24 May 2020, the player lodged a claim before FIFA against the club for outstanding remuneration and breach of contract, and requested, inter alia, the payment of the total amount of EUR 155,719.78 “with the legal interests from the day being delayed for the accrued earnings and from the day of my claim for the compensation”, amount composed as follows:

a) EUR 19,869.28 as outstanding net salaries related to the months of January, February, March and April 2020 plus interest as from due dates;

b) EUR 135,850.50 as compensation for breach of contract equivalent to the residual value of the contract plus 5% interest p.a. as from 24 May 2020;

c) Furthermore, he requested the imposition of sporting sanctions on the Respondent.

10. Moreover, the player sustained that the DRC is competent to adjudicate any potential dispute between the parties “because of denial of justice in Greece”.

11. In its reply to the claim, the Respondent questioned the competence of FIFA and alternatively, requested to reject the claim.

12. The club referred to the jurisdiction clause contained in art. 10 of the contract and sustained that such clause had been mutually agreed by the parties and that it is a clear jurisdiction clause in favour of the mentioned bodies in it.

13. In addition, the club recalled that in its opinion “The Financial Dispute Resolution Committee of the HFF (PEEOD), as well as the second instance judicial body of the HFF (Arbitration Court) are among the judicial bodies that have been expressly recognized by both the CAS and FIFA as independent arbitration tribunals guaranteeing fair proceedings, as required by the FIFA RSTP”.

14. Finally, the club referred to the content of its letter dated 14 April 2020 and explained that “It is of course clear that nothing or nobody prevented the Claimant to lodge (- send) his claim before the competent judicial bodies of Hellenic Federation on 24.5.2020, as he did before your Committee [DRC], so that it would be judged immediately upon the end of suspension.”

15. As to the substance, the club firstly confirmed that the last salary paid to the player was part of January 2020.

16. Moreover, the club stated that on 12 March 2020, according to a decision of the Ministry of Culture and Sports, the professional football championship was suspended for an indeterminate period, due to Covid-19 outbreak.

17. The club added that the player, “in an abusive manner, sent the second warning letter on 1.4.2020, i.e. when everything, was already under suspension and no football activity was undertaken and of course no services were provided by him.”

18. According to the club, the Hellenic Federation suspended, as of 9 April 2020 until 30 June 2020, the application of the specific article of the Regulation on Status and Transfers of Players of the Hellenic Federation, which provides the procedure of termination of a contract with just cause, due to situations of force majeure. Therefore, the club was not obliged to pay to the player the agreed salary for March and April 2020, since the player did not provide the club with his services.

19. Furthermore, the club clarified that was true that the team’s coach was disappointed with the player’s performance before the suspension of the championship, however it is not true that the club prevented him to keep training with the rest of the team, as he alleged in his claim.

20. The club maintained that, the player’s letter dated 8 May 2020, cannot justify the lodge of the present claim and the alleged termination of the player’s contract, “since it was sent in a period that Covid -19 impacts were enormous and since the Claimant was requesting with this letter the payment of the salary of March and April of 2020, which he was not entitled to receive. Until that date, our club owed to the Claimant only part of the salary of January 2020 and also the salary of February 2020. Thus, there was no justification for the Claimant to terminate his contract, as he alleges.”

21. The club further maintained that the player’s claim cannot be considered as a termination notice and therefore he shall not be entitled to receive compensation for breach of contract.

22. In consideration of all the above, the club requested the following:

“i. to rule that it is not competent to decide on the present matter;

ii. to reject the claim as inadmissible;

iii. to rule that the Claimant shall bear any and all costs of the proceedings.

Subsidiarily and only in the event that the above is rejected,

i. to rule that no breach of contract occurred by our club;

ii. to reject the claim as groundless;

iii. to rule that the Claimant shall bear any and all costs of the proceedings.

Subsidiarily and only in the event that the above is rejected,

i. to reject the claim as abusive or to diminish the compensation payable for alleged breach of contract taking into consideration the overall circumstances of the case and the obligation of the Claimant to mitigate his damages;

ii. to rule that the Claimant shall bear any and all costs of the proceedings.”

23. Upon being requested by FIFA, the player informed our services that on 27 July 2020 he concluded an employment contract with the Serbian club Football Club Vozdovac, valid as from the date of signature until 30 June 2021, by means of which the club undertook to pay to the player a total amount of Serbian Dinar (RSD) 384,000.

II. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER

1. First of all, the Dispute Resolution Chamber (hereinafter also referred as DRC or Chamber) analysed whether it was competent to deal with the case at hand. In this respect, the Chamber took note that the present matter was submitted to FIFA on 24 May 2020. Consequently, the DRC concluded that the November 2019 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules) is 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 August 2020), the Dispute Resolution Chamber is, in principle, competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension between a Serbian player and a Greek club.

3. However, the DRC acknowledged that the Respondent contested the competence of FIFA’s deciding bodies on the basis of art. 10 of the contract highlighting that the “The Financial Dispute Resolution Committee of the HFF (PEEOD), as well as the second instance judicial body of the HFF (Arbitration Court)” are independent deciding bodies and competent to deal with the matter, which was previously “recognized by both the CAS and FIFA as independent arbitration tribunals guaranteeing fair proceedings”.

4. Taking into account the above, the Chamber emphasised that in accordance with art. 22 lit. b) of the Regulations on the Status and Transfer of Players it is competent to deal with a matter such as the one at hand, unless an independent arbitration tribunal, guaranteeing fair proceedings and respecting the principle of equal representation of players and clubs, has been established at national level within the framework of the Association and/or a collective bargaining agreement. With regard to the standards to be imposed on an independent arbitration tribunal guaranteeing fair proceedings, the Chamber referred to FIFA Circular no. 1010 dated 20 December 2005. In this regard, the Chamber further referred to the principles contained in the FIFA National Dispute Resolution Chamber (NDRC) Standard Regulations, which came into force on 1 January 2008.

5. In continuation, the DRC wished to stress that in its reply the Respondent stated that following: “the Hellenic Federation decided, on 18.3.2020 the suspension of its operation” and it added that “(…) it is true that nobody prevented the Claimant to lodge (- send) his claim before the competent judicial bodies of Hellenic Federation on 24.5.2020, as he did before your Committee, so that it would be judged upon the end of suspension.”

6. In this respect, the members of the Chamber pointed out that by reading the Respondent’s statement, it was of the opinion that the Respondent clearly affirmed that the activity of the Greek deciding bodies were suspended when the Claimant decided to lodged his claim in front of FIFA on 24 May 2020.

7. Along those lines, the Chamber noted that the Respondent was unable to prove that the functioning and operation of the Greek National Dispute Resolution Chamber was operative and functioning as of 24 May 2020. As a result, the Chamber had no other option but to conclude that at the moment the Claimant lodged his claim before FIFA, there was (temporary) no National Dispute Resolution Chamber available for the Claimant.

8. In view of all the above, the DRC established that the club’s objection to the competence of FIFA to deal with the present matter has to be rejected and that the Dispute Resolution Chamber is competent, on the basis of art. 22 lit. b) of the Regulations on the Status and Transfer of Players, to consider the present matter as to the substance.

9. 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 Player (edition August 2020), and considering that the present claim was lodged on 24 May 2020, the March 2020 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

10. 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.

11. First of all, the members of the Chamber recalled that, on 13 August 2019, the parties concluded a contract, valid as of the date of signature until 30 June 2022.

12. In continuation, the DRC noted that the Claimant lodged a claim against the Respondent maintaining that he had terminated the contract with just cause on 24 May 2020 since the club failed to remit remuneration in the total amount of EUR 19,869.28, amount related to 4 monthly salaries. Consequently, the Claimant asks to be awarded his outstanding dues as well as the payment of compensation for breach of the employment contract.

13. The Respondent, for its part, rejected the claim and held that the player did not terminate the contract with just cause on 24 May 2020. In its argumentation it held that certain payments were not payable due do the Covid-19 pandemic.

14. Having said this, the DRC acknowledged that the central issue in the matter at stake was to determine as to whether the contract was terminated by the Claimant with or without just cause and to decide on the consequences thereof.

15. With the above in mind, 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.

16. Subsequently, the DRC recalled that the Claimant put the Respondent in default several times, the last on 8 May 2020, by means of which it gave the Respondent 15 days to remedy its default, before he terminated the contract on 24 May 2020, by means of the present claim.

17. In this context, the members of the Chamber established that the Respondent failed to proof that it actually remitted the amounts claimed by the player. In this context, the DRC pointed out that the Respondent failed to submit any evidence regarding the claimed payments and that it solely relied on the argumentation that certain amounts were not due based on the COVID-19 pandemic.

18. As such, the members of the Chamber noted that even though the default notices were sent during the period of the COVID-19 outbreak, as invoked by the Respondent in order to contest the Claimant’s request, part of said outstanding remuneration was due prior to the period of COVID-19.

19. 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.

20. For this dispute, it is important to note that based on the COVID-19 Guidelines, as well as the 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.

21. On account of the above, the DRC rejected the Respondent’s argumentation. As such, considering the outstanding monthly payments upon termination, we would suggest that the Claimant terminated the contract with just cause on 24 May 2020.

22. Consequently, considering that the Respondent had thus 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 24 May 2020 and that, as a result, the Respondent is to be held liable for the early termination of the employment contact with just cause by the Claimant.

23. Subsequently, prior to establishing the consequences of the termination of the employment contract with just cause by the Claimant in accordance with art. 17 par. 1 of the Regulations, the Chamber held that it, in general, had to address the issue of unpaid remuneration at the moment when the contract was terminated by the Claimant.

24. Bearing in mind the considerations above, and in accordance with the general legal principle of pacta sunt servanda, the Chamber established that the Claimant is entitled to EUR 24,683.46, corresponding to award 4 monthly salaries of EUR 628.35 each (February to May 2020), i.e. EUR 2,513.40, plus one Easter bonus amounting to half a salary as stipulated in the contract (EUR 314.175) as well as to part of the salary of January 2020 amounting to EUR 3,855.88 plus 4 monthly instalments of EUR 4,500 each (February to May 2020), i.e. EUR 21,855.88.

25. In addition, taking into consideration the player’s claim, the Chamber decided to award the Claimant interest at the rate of 5% p.a. as requested, as of the due dates until the date of effective payment.

26. Moreover, and taking into consideration art. 17 par. 1 of the Regulations, the Chamber decided that the Claimant is entitled to receive compensation for breach of contract from the Respondent.

27. In continuation, the Chamber focused its attention on the calculation of the amount of compensation for breach of contract in the case at stake. In doing so, the members of the Chamber firstly 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.

28. In application of the relevant provision, the Chamber 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 Chamber established that no such compensation clause was included in the employment contract at the basis of the matter at stake.

29. 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. Therefore, other objective criteria may be taken into account at the discretion of the deciding body. In this regard, the Dispute Resolution Chamber emphasised beforehand that each request for compensation for contractual breach has to be assessed by the Chamber on a case-by-case basis taking into account all specific circumstances of the respective matter.

30. The members of the Chamber then turned their attention to the remuneration and other benefits due to the Claimant under the existing contract and/or the new contract, which criterion was considered by the Chamber to be essential. The members of the Chamber deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows the Chamber to take into account both the existing contract and the new contract, if any, in the calculation of the amount of compensation.

31. Bearing in mind the foregoing, the Chamber proceeded with the calculation of the monies payable to the player under the terms of the employment contract as from the date of termination with just cause by the Claimant until its natural expiration, bearing in mind that he would have received in total EUR 130,722.15 as remuneration for the period as from June 2020 until June 2022. Consequently, the Chamber concluded that the amount of EUR 130,722.15 serves as the basis for the final determination of the amount of compensation for breach of contract in the case at hand.

32. 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.

33. In this respect, the Chamber recalled that the Claimant had found new employment with the Serbian club, Football Club Vozdovac, as from 27 July 2020 until 30 June 2020, which remuneration during the overlapping period shall be deducted, leading to a mitigated compensation in the amount of EUR 124,424.89

34. Subsequently, the Chamber turned its attention to art. 17 par. 1 lit. ii) of the Regulations, according to which a player is entitled to an additional compensation of three monthly salaries, subject to the early termination of the contract being due to overdue payables. In case of egregious circumstances, the additional compensation may be increased up to a maximum of six monthly salaries, whereby the overall compensation may never exceed the rest value of the prematurely terminated contract.

35. With the above in mind, the Chamber decided to award the Claimant additional compensation corresponding to three monthly salaries, i.e. EUR 15,385.05, in accordance with the above-mentioned provision.

36. Since the overall compensation exceeds the residual value of the prematurely terminated contract, the player would be entitled to receive EUR 130,722.15 as compensation for breach of contract, plus 5% interest p.a. as of the date of claim, i.e. 24 May 2020, until the date of effective payment.

37. Moreover, the Chamber rejected any claim for legal expenses and procedural compensation in accordance with art. 18 par. 4 of the Procedural Rules and the Chamber’s respective longstanding jurisprudence in this regard.

38. In light of the above, the DRC concluded its deliberations in the present matter by establishing that the claim of the Claimant is admissible and partially accepted.

39. Furthermore, taking into account the consideration under number II./9. 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.

40. In this regard, the Chamber established that, in virtue of the aforementioned provision, it has competence to impose a sanction on the Respondent. More in particular, the DRC pointed out that, against clubs, the sanction shall consist in a ban 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.

41. Therefore, bearing in mind the above, the DRC decided that, in the event that the Respondent does not pay the amount 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.

42. 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, Nikola Stankovic, is admissible.

2. The claim of the Claimant is partially accepted.

3. The Respondent, Larissa FC, has to pay to the Claimant, the following amounts:

- EUR 24,683.46 as outstanding remuneration plus 5% interest p.a. calculated as follows:

a. Over the amount of EUR 628.35 as from 1 March 2020 until the date of effective payment;

b. Over the amount of EUR 628.35 as from 1 April 2020 until the date of effective payment;

c. Over the amount of EUR 628.35 as from 1 May 2020 until the date of effective payment;

d. Over the amount of EUR 628.35 as from 1 June 2020 until the date of effective payment;

e. Over the amount of 314.175 as from 1 May 2020 until the date of effective payment;

f. Over the amount of 3,855.88 as from 1 February 2020 until the date of effective payment;

g. Over the amount of 4,500 as from 1 March 2020 until the date of effective payment;

h. Over the amount of 4,500 as from 1 April 2020 until the date of effective payment;

i. Over the amount of 4,500 as from 1 May 2020 until the date of effective payment;

j. Over the amount of 4,500 as from 1 June 2020 until the date of effective payment.

- EUR 130,722.15 as compensation for breach of contract without just cause plus 5% interest p.a. as from 24 May 2020 until the date of effective payment.

4. Any further claims of the Claimant are rejected.

5. 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.

6. 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).

7. 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 amounts are 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 are 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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