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 13 January 2021

Decision of the

DRC Judge

passed on 13 January 2021

regarding an employment-related dispute concerning the player Marius Valerica Gaman

BY:

Jon Newman (USA), DRC Judge

CLAIMANT:

Marius Valerica Gaman, Romania

Represented by Mr Lazar Marius Constantin

RESPONDENT:

Al Shabab, Saudi Arabia Represented by Squire Patton Boggs

I. FACTS OF THE CASE

1. On 10 December 2018, the Romanian player, Marius Valerica Gaman (hereinafter: the player), and the Saudi club, Al Shabab (hereinafter: the club) concluded an employment contract (hereinafter: the contract), valid as from 1 July 2019 until 30 June 2020.

2. In accordance with clause 4 of the contract, the club undertook to pay to the player, for the season 2019/2020, inter alia, a monthly remuneration of USD 50,000, payable at the end of each month.

3. According to the Respondent, the Saudi Pro League (SPL) was suspended on 15 March 2020 due to Covid-19. Moreover, the Respondent held that the SPL –via its circular letter no. 01440– requested clubs to “decrease their expenses and to be cautious to avoid any financial difficulties or legal disputes”.

4. On 14 April 2020, the Respondent issued a circular letter, whereby the club informed its players, inter alia, about the following: “As suggested by FIFA, we intend to work with our playing squad in order to consider any necessary amendments to contractual terms, including those concerning remuneration. In line with this, we will be contacting all of our players in order to undertake discussions. We hope that we can work together on this issue in contemplation of the significant pressures on our club, as well as our society in this time”.

5. By means of its letter dated 17 April 2020, the club informed the player about a unilateral reduction of his monthly salaries. In particular, the club informed the player about the following: “Therefore, it is decided to: Reducing the monthly wage during the period of Corona epidemic, which is equivalent to all professional players in the club along with the technical staff. Where, the amount of (20,000 twenty thousand Saudi riyals) from the monthly wage will be maintained fixed without any reduction, while the remaining amount of the monthly wage shall be deducted by 50% this reduction is effective from 15/3/2020 until resuming the sport activity and training and the end of Corona epidemic outbreak. […] This notice is binding and effective from […] its sending date. Al-Shabab Club thanks you for your patience, cooperation and understanding such difficulties situation”.

6. On 20 September 2020, the player lodged a claim against the club before FIFA, requesting to be awarded outstanding remuneration in the amount of USD 78,951, plus 5% interest p.a. as from 30 June 2020 until the date of effective payment, corresponding to the following amounts:

- USD 11,911 corresponding to the unpaid part of the salary of March 2020;

- USD 22,334 corresponding to the unpaid part of the salary of April 2020;

- USD 22,333 corresponding to the unpaid part of the salary of May 2020;

- USD 22,373 corresponding to the unpaid part of the salary of June 2020.

7. In his claim, the Claimant firstly held that, from the amount of USD 200,000 that the club should have paid him as from March until June 2020 (50,000*4 = 200,000), the club only paid him the amount of USD 121,049. Therefore, the Claimant is requesting the difference between the amounts due and the amounts paid, which amount to USD 78,951 (200,000 – 121,049 = 78,951).

8. In its reply to the claim, the club acknowledged having unilaterally reduced the player’s salaries as from March until June 2020 in the amounts specified by the Claimant.

9. Notwithstanding the above, the Respondent maintained that, following the indications provided by the SPL (cf. point I.3 supra), the club reduced the salaries of the Saudi players of the team, which represent 76.6% of the players of the team.

10. In this context, the Respondent argued that, since the salary reductions are to be applied uniformly to all players, the unilateral reduction of the salaries would also apply to the 7 non Saudi players, amongst which the Claimant is placed. In this respect, the club argued that, from the said 7 non Saudi players, the Claimant is the only one who contested the reduction applied by the Respondent.

11. The Respondent further stated that since the salaries of March, April and May were paid to the player in the reduced amount, without the player complaining about it, the said unilateral reduction is to be interpreted as tacitly accepted by the Claimant.

12. In its request for relief, the Respondent requested the following: “Reject the claim as the claimant is not entitled to any compensation of money as a result of this deduction, which was applied to the entire team with full acceptance and response”.

II. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER JUDGE

1. First of all, the Dispute Resolution Chamber judge (hereinafter also referred to as DRC judge) analyzed whether he was competent to deal with the case at hand. In this respect, he took note that the present matter was submitted to FIFA on 20 September 2020 and submitted for decision on 13 January 2021. Taking into account the wording of art. 21 of the January 2021 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules), the June 2020 edition of the Procedural Rules is applicable to the matter at hand.

2. Subsequently, the DRC judge 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 on the Status and Transfer of Players, the DRC judge is competent to deal with the matter at stake, which concerns an employment–related dispute with an international dimension.

3. In continuation, the DRC judge analysed which regulations should be applicable as to the substance of the matter. In this respect, the DRC judge 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 20 September 2020, the August 2020 edition of the aforementioned regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

4. The competence of the DRC judge and the applicable regulations having been established, the DRC judge entered into the substance of the matter. In this respect, the DC judge started by acknowledging all the above-mentioned facts as well as the arguments and the documentation submitted by the parties. However, the DRC judge emphasised that in the following considerations he will refer only to the facts, arguments and documentary evidence, which she considered pertinent for the assessment of the matter at hand.

5. Having said that, the DRC judge acknowledged that the Claimant is requesting to be awarded outstanding remuneration in the amount of USD 78,951, which would correspond to the unpaid part of the salaries due to the player as from March until June 2020 in accordance with the breakdown established in point I.6 supra, plus the relevant default interest.

6. After a careful analysis of the documentation brought forward by the Claimant and the Respondent to the present proceedings, the DRC judge firstly stressed that It remained uncontested that the Respondent unilaterally reduced the Claimant’s monthly entitlements as from March 2020 until July 2020 in the amount of USD 78,951, due to the financial impact of Covid-19 and on the grounds of the circular letter issued by the Saudi Pro League (SPL).

7. In this context, the DRC judge wished to emphasize that, in accordance with the Covid-19 guidelines issued by FIFA in April 2020, clubs and players were encouraged to work together to find agreements and solutions during the period when football is suspended. Nevertheless, -continued the DRC judge- unilateral decisions that alter the contractual rights and obligations of the parties are not permitted.

8. Thus, the DRC judge determined that, in order to assess whether the salary reduction imposed by the club is lawful or not, the following is to be taken into consideration:

- whether there was a genuine attempt by the club to reach agreement with the players: in this regard, the DRC judge noted that the club failed to prove that the salary reduction of 50% imposed on the player as from March 2020 was subject of negotiation and acceptance between the parties. No amendment to the contract was concluded between the parties and no consent from the player was sought by the club before applying the said salary reduction;

- what the economic situation of the club is: in this respect, the DRC judge observed that no evidence was provided by the club as to its financial situation as from March 2020 in order to properly evaluate whether such monthly reduction was reasonable or not;

- the proportionality of any adjustment to player contracts: in this regard, the DRC judge acknowledged that no explanation was provided by the club as to the proportionality of a 50% salary reduction;

- the net income position of players after any contract adjustment: in this respect, the DRC judge duly noted that the net income of the player after the imposition of the salary reduction seems to amount to approximately USD 27,500. Although the said amount represents more than 50% of the player’s monthly salary as to the contract –explained the DRC judge– the fact that the said decrease was unilaterally imposed by the club without any previous negotiation attempt turns the said reduction into an unlawful reduction, insofar it was unilaterally decided by the club;

- whether players have been treated equally or not: In this regard, the DRC judge acknowledged the allegations of the club, whereby the latter stated that the said salary reduction was imposed on all Saudi players. Hence, according to the Respondent, non-Saudi players are to be treated in the same way and, therefore, the same salary reduction shall apply to them. In this respect, the DRC judge wished to emphasize that, even though the argument of the Respondent does seem reasonable, the latter –first of all– did not provide any evidence of having de facto imposed the said salary reduction on the Saudi players of the club (no bargaining agreement concluded between the Respondent and the players is on file and no financial evidence regarding the said reduction was provided by the Respondent). Secondly and most importantly, explained the DRC judge, even if provided, the right of the club to drag along the non-Saudi players –without any existing contractual clause allowing the said practice– seems to be too burdensome to be considered as a lawful practice.

9. In view of all of the above, the DRC judge concluded that the salary reduction imposed by the Respondent was not in compliance with the FIFA guidelines issued in April 2020 and that the Respondent has not provided sufficient documentary evidence in order to support that it was lawful.

10. Consequently, continued the DRC judge, in view of the fact that the amounts requested by the Claimant have a contractual basis and that the reason provided by the Respondent in connection with the non-payment of the player´s financial entitlements cannot be upheld, the DRC judge determined that the Respondent is to be considered liable and must pay outstanding remuneration to the Claimant by virtue of application of the legal principle pacta sunt servanda.

11. Hence, the DRC judge determined that the Respondent shall pay to the Claimant outstanding remuneration in the amount of USD 78,951, corresponding to the unpaid part of the salaries due to the player as from March until June 2020 in accordance with the breakdown established in point I.6 supra.

12. In addition, taking into account the Claimant’s claim, as well as the DRC’s longstanding jurisprudence in this respect, the DRC judge decided to award the Claimant interest of 5% p.a. on the amount of USD 78,951 as from 30 June 2020 –as requested– until the date of effective payment.

13. Furthermore, taking into account the previous considerations, the Dispute Resolution 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.

14. In this regard, the Dispute Resolution 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.

15. Therefore, bearing in mind the above, the Dispute Resolution Chamber 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.

16. Finally, the Dispute Resolution 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.

17. The DRC concluded its deliberations on the present matter by establishing that the claim of the Claimant is accepted.

III. DECISION OF THE DRC JUDGE

1. The claim of the Claimant, Marius Valerica Gaman, is accepted.

2. The Respondent, Al Shabab, has to pay to the Claimant outstanding remuneration in the amount of USD 78,951, plus 5% interest p.a. as from 30 June 2020 until the date of effective payment.

3. The Claimant is directed to immediately and directly inform the Respondent of the relevant bank account to which the Respondent must pay the due amount.

4. The Respondent shall provide evidence of payment of the due amount in accordance with this decision to psdfifa@fifa.org, duly translated, if applicable, into one of the official FIFA languages (English, French, German, Spanish).

5. In the event that the amount due, plus interest as established above is 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 amount is paid.

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

2.

In the event that the payable amount 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.

6. The decision is rendered free of costs.

For the DRC judge:

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).

CONTACT INFORMATION:

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