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 29 July 2016

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 29 July 2016,

in the following composition:

Geoff Thompson (England), Chairman

Santiago Nebot (Spain), member

John Bramhall (England), member

Guillermo Saltos Guale (Ecuador), member

Wouter Lambrecht (Belgium), 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 2 August 2014, the player from country B, Player A (hereinafter: the Claimant) and the club from country D, Club C (hereinafter: the Respondent), concluded an employment contract (hereinafter: the contract), valid as of 1 August 2014 until 31 July 2016.

2. Pursuant to art. III of the contract, the Claimant was entitled to the following:

“2.1 Basic Wage:

2.1.1 €66,000 net (Sixty-six Thousand Euro net) for the first year, payable by monthly instalments.

2.1.2 At the end of the first year in the contract, if the [Claimant] has played at least 65% of all official games (competitions, cup, possible play-off and European games, minimum 45 minutes per game during the season 2014/15), he will receive a 20% increase of the basic wage for the second year of the contract. If the [Claimant] does not achieve to play 65% of the games his salary remains 66.000 Euro net to be paid in monthly installments of 5.500 Euro for the season 2015/16.

2.1.3 The [Respondent] will pay to the [Claimant] 25% of the sum at the moment of signing the contract.

2.1.4 The rest of the sum will be split in monthly installments, payable in the first working week of each month.

2.1.5 The [Respondent] shall pay a bonus of €10.000 Net to the [Claimant], if the [Respondent] wins the title in country D’s Championship in the season 2014/2015. The same bonus is valid for the season 2015/2016.

2.1.6 After every game won, the [Respondent] will give extra rewards to the players, decided before each game: the [Claimant] will receive 100% of the reward when he plays in the starting lineup, 60% when he enters from the bench, 30% when he is on the bench but does not participate in the game.

2.1.7 Housing and food are covered by the [Respondent]”.

3. On 3 February 2015, the Claimant requested the Respondent to pay his outstanding remuneration in the amount of EUR 17,374 by no later than 6 February 2015.

4. On 25 September 2015, the Claimant sent a new correspondence to the Respondent, requesting his dues and informing the latter that he would be open to discuss the mutual termination of the employment contract.

5. On 10 November 2015, the Claimant sent an e-mail to the Respondent, terminating the contract and requesting the latter to pay him EUR 90,000 within three days as well as EUR 2,500 as reimbursement of costs and to confirm the immediate termination of the employment contract. In addition, the Claimant informed the Respondent that should the latter not comply with his requests, he would lodge a claim with FIFA.

6. On 11 November 2015, the Respondent sent a correspondence to the Claimant in which it refers to several penalties imposed on him due to his misbehaviour and expresses its intention to settle the matter in order to maintain the contractual relationship.

7. On the same date, the Claimant rejected the validity of the alleged penalties imposed on him.

8. On 12 November 2015, the Respondent offered the Claimant to pay him an amount of EUR 42,000.

9. On the same date, the Claimant rejected the Respondent’s offer and proposed an alternative settlement, i.e. the payment of EUR 50,000 immediately and the payment of EUR 50,000 at the end of January 2016.

10. On 18 November 2015, the Claimant lodged a claim in front of FIFA against the Respondent for breach of contract, requesting:

“- To order [the Respondent] to pay €108.124,00 net to [the Claimant] within 31 days of [FIFA] decision;

(…)

- To order [the Respondent] to pay the extrajudicial costs of €2.500,00 ex VAT, within 5 days of [FIFA] decision

- To order [the Respondent] to pay the costs of this procedure”.

11. In his claim, the Claimant sustains that since the signature of the contract, he has only received the amount of EUR 23,876, paid as follows:

- EUR 16,500 on 7 August 2014 corresponding to 25% of his annual salary in accordance with art. 2.1.3 of the contract;

- EUR 3,465 on 19 September 2014 corresponding to part of his salary for August 2014;

- EUR 2,987 on 29 October 2014 corresponding to part of his salary for September 2014;

- EUR 924 on “291014”corresponding to part of his salary for December 2014.

12. In continuation, the Claimant explains that after he put the Respondent in default in February 2015, the latter started to threaten him. The Claimant further alleges that, being feared for his safety, he left the country at the end of the 2014-15 season. In particular, the Claimant points out that for the season 2014-15, an amount of EUR 42,124 net plus interest is due.

13. Furthermore, the Claimant maintains that the penalties allegedly imposed on him for not having started the season with the Respondent have no legal basis and were not notified to him.

14. On 12 February 2016, The Football Association of country D informed FIFA that the Claimant was registered with it under country D’s nationality.

15. The Respondent submitted its response to the claim only after the phase of investigation had been closed.

16. On 12 February 2016, the Claimant was registered with the club from country E, Club F, on an amateur basis.

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 case at hand. In this respect, it took note that the present matter was submitted to FIFA on 18 November 2015. Consequently, the 2015 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. article 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 2016), 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 from country B and a club from 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 (edition 2016), and considering that the present claim was lodged on 18 November 2015, the 2015 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. The members of the Chamber started by acknowledging the facts of the case, as well as the documentation contained in the file. However, the Chamber emphasised that in the following considerations it will refer only to facts, arguments and documentary evidence which it considered pertinent for the assessment of the matter at hand. In this respect, the Chamber acknowledged that the parties had signed an employment contract, valid as of 1 August 2014 until 31 July 2016.

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. In particular, the Claimant alleged that the Respondent failed to pay him several monthly salaries and started threatening him after he put the Respondent in default in February 2015.

6. Subsequently, the DRC observed that the reply of the Respondent was received after notification of the closure of the investigation of the matter at hand. As a result, in line with art. 9 par. 4 of the Procedural Rules as well as the Chamber’s constant jurisprudence in this regard, the DRC decided not to take into account the reply of the Respondent and established that, in accordance with art. 9 par. 3 of the Procedural Rules, it shall take a decision upon the basis of those documents on file that were provided prior to the closure of the investigation-phase, in casu, upon the statements and documents presented by the Claimant.

7. Having said the above, the Chamber deemed that the underlying issue in this dispute was to determine when and whether the contract had been terminated by the Claimant with or without just cause.

8. In view of the above, the DRC deemed it appropriate to shortly recall the timeline of events in the present matter according to the documentary evidence on file. In this context, the Chamber outlined that it is uncontested that the Claimant left definitively country D at the end of the 2014-15 season, thereby stopping to render services to the Respondent as of that date. Consequently, the Chamber concluded that, even though the Claimant formally terminated the contractual relationship on 10 November 2015, the contract had de facto been terminated at the end of the 2014-15 season, i.e. on 31 May 2015.

9. At this stage, the Chamber noted that until the aforementioned date of termination, the Respondent should have paid the Claimant the amount of EUR 57,750, out of which it paid EUR 23,876. Consequently, the members of the Chamber determined that the Respondent failed to pay the amount of EUR 33,864 which corresponds to more than half of the Claimant’s annual remuneration.

10. On account of the aforementioned, and, in particular, taking into account that the Respondent did not reply to the claim and thus, did not contest that the claimed salaries had remained unpaid, the DRC established that the Respondent, without any valid reason, failed to remit to the Claimant, until 31 May 2015, more than half of his annual remuneration. 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 31 May 2015 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.

11. Having established that the Respondent is to be held liable for the early termination of the employment contract, the Chamber focused its attention on the consequences of such termination. Taking into consideration art. 17 par. 1 of the Regulations, the Chamber decided that the Claimant is entitled to receive from the Respondent an amount of money as compensation for breach of contract in addition to any outstanding payments on the basis of the relevant employment contract.

12. At this stage, the DRC made reference to its previous considerations and recalled that at the time of the termination, i.e. on 31 May 2015, the amount of EUR 33,864 was outstanding.

13. Consequently, in accordance with the principle of pacta sunt servanda, the DRC judge decided that the Respondent is liable to pay the Claimant the amount of EUR 33,864 as outstanding remuneration.

14. In continuation, the Chamber focused its attention on 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 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.

15. In application of the relevant provision, the Chamber held that it first of all had to clarify as to whether the pertinent employment contract contained 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.

16. 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.

17. Bearing in mind the foregoing, the Chamber proceeded with the calculation of the monies payable to the Claimant under the terms of the employment contract until 31 July 2016, taking into account that the Claimant’s remuneration until May 2015 is included in the calculation of the outstanding remuneration. Consequently, the Chamber concluded that the amount of EUR 72,460, i.e. remuneration as from June 2015 until 31 July 2016, serves as the basis for the determination of the amount of compensation for breach of contract.

18. 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. In this regard, the Chamber noted that the player only signed an amateur contract, which did not provide for any remuneration, in the relevant period of time.

19. In view of all of the above, the DRC decided that the Respondent must pay the amount of EUR 74,260 to the Claimant, which is considered by the DRC to be a reasonable and justified amount as compensation for breach of contract.

20. 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.

21. The Dispute Resolution Chamber concluded its 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, within 30 days as from the date of notification of this decision, outstanding remuneration in the amount of EUR 33,864.

3. The Respondent has to pay to the Claimant, within 30 days as from the date of notification of this decision, compensation for breach of contract amounting to EUR 74,260.

4. In the event that the amounts due to the Claimant in accordance with the above-mentioned points 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.

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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