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 20 April 2017

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 20 April 2017,

in the following composition:

Geoff Thompson (England), Chairman

Leonardo Grosso (Italy), member

Mohamed Mecherara (Algeria), 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

between the parties

I. Facts of the case

1. On an unspecified date, the Player of Country B, Player A (hereinafter: the player or Claimant) and the Club of Country D, Club C (hereinafter: the club or Respondent) concluded an employment agreement (hereinafter: the contract), valid as from 16 July 2016 until ‘2016/2017 period 1 season’.

2. According to the contract, the player was entitled to receive the total amount of ‘USD 100,0000=3/008/950/000 net’, as follows:

 30% of ‘3/008/950/000 net’, payable ‘one week before starting the first game’;

 20% of ‘3/008/950/000 net’, payable ‘in half season time’;

 30% of ‘3/008/950/000 net’, payable ‘in 10 instalments during the tournament’;

 20% of ‘3/008/950/000 net’, payable ‘before the last game of the season’.

3. On 22 November 2016, the player lodged a claim against the club in front of FIFA, requesting that the club has to be ordered to pay him the total amount of 2,286,793,000, specified as follows:

Outstanding remuneration in the amount of 707,103,250 (approximately USD 23,500), as follows:

 30,098,500 as salary for July 2016, plus 5% interest p.a. as of 1 August 2016;

 30,098,500 as salary for August 2016, plus 5% interest p.a. as of 1 September 2016;

 30,098,500 as salary for September 2016, plus 5% interest p.a. as of 1 October 2016;

 15,044,750 as salary for the period between 1 and 15 October 2016, plus 5% interest p.a. as of ‘1-15 October’ 2016;

 601,790,000 as the unpaid part of the first instalment (cf. point 2. above), plus 5% interest p.a. as of 18 July 2016.

Compensation for breach of contract in the amount of 1,399,161,750 (approximately USD 46,500), as follows:

 195,581,750 as monthly salaries for the period between 16 October 2016 and the end of the contract;

 601,790,000, due as ‘second payment’;

 601,790,000, due as from ‘the last game of the season’.

Further, the player requested 5% interest p.a. on the amount of 1,399,161,750 to be paid, as of 15 October 2016. In addition, the player requested for an additional compensation in the amount of 180,537,000, as well as sporting sanctions to be imposed on the club.

4. According to the player, on 27 September 2016, the club only paid him 300,895,000, out of the first instalment of 30% of his total salary (cf. point 4. above). Further, the player holds that the club failed to pay him the monthly payments for the months of July, August and September in the amount of 30,089,500, or according to the player USD 1,000.

5. On 27 September 2016, the player put the club in default for not having paid to him the outstanding amount of “USD 20,000”, requesting for the immediate payment, however to no avail.

6. Furthermore, the player holds that on 15 October 2016, the club confirmed him that it ‘had no financial conditions to comply with the payment of the outstanding remuneration until the approval of the loan before one of the local banks’.

7. On 15 October 2016, the player unilaterally terminated the contract with the club, due to the outstanding amounts.

8. In spite of having been invited to submit its reply to the player’s claim before 22 January 2017, and having asked for a deadline extension on 22 January 2017 (which was granted) and 2 February 2017 (which was rejected), the club did not respond as to the substance to the claim of the player.

9. According to the information in the TMS and the information provided by the player, on 21 December 2016, the player signed an employment contract with the Club of Country B, Club E, valid as from 21 December 2016 until 30 September 2017, according to which the player is entitled to receive a monthly salary of 1,500 (approximately 11,711,666). For the period between 21 December 2016 and 24 May 2017, this corresponds to a total approximate amount of 7,500 (approximately 70,270,000).

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 22 November 2016. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2015; 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 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 of Country B and a Club of 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 22 November 2016, the 2016 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. In continuation, the members of the Chamber noted that the player lodged a claim against the club, maintaining that he had terminated the employment contract with just cause on 15 October 2016, after previously having put the club in default, since the club allegedly failed to pay the player’s remuneration. In this respect, the player submits to have only received a partial payment of 300,895,000 out of the first instalment of 30% of 3,008,950,000 (i.e. 902,685,000), and that the club failed to pay him his monthly salaries for July, August and September 2016 at the time he terminated the employment contract. Consequently, the player asks to be awarded his outstanding dues, as well as the payment of compensation for breach of the employment contract.

6. Subsequently, the DRC observed that the club, in spite of having been invited to do so, had failed to present its reply to the claim of the player, even within the extended deadline granted by FIFA, i.e. 2 February 2017. In fact, on 2 February 2017, the club requested a second extension of the deadline, which request was denied by the FIFA Administration, which subsequently closed the investigation phase in the matter at hand.

7. Based on the foregoing, bearing in mind the Chamber’s constant jurisprudence in this regard and in application of art. 9 par. 3 and art. 16 par. 12 of the Procedural Rules, first of all the Chamber decided that the club’s request for an extension of the deadline was correctly denied by the FIFA Administration, as this was the second request for an extension of the deadline and that in the absence of a timely answer of the club, the investigation phase of the matter at hand was closed in accordance with art. 9 par. 3 of the Procedural Rules.

8. As a consequence of the aforementioned considerations, the members of the Chamber concurred that, in accordance with art. 9 par. 3 of the Procedural Rules, a decision shall be taken upon the basis of the documents already on file, in other words, upon the statements and documents presented by the player.

9. In accordance with the employment contract, the club was obliged to pay to the player at the time the contract was terminated by the player, i.e. on 15 October 2016, a monthly salary for the months of July, August and September 2016, each of these monthly salaries corresponding to 10% of 30% of ‘3/008/950/000 net’, plus the remaining outstanding part of the sign-on fee in the amount of 601,790,000.

10. On account of the aforementioned, in particular in view of the considerations under point II./7., II./8. and II./9. above, the Chamber established that the club, without any valid reason, failed to remit to the player, until 15 October 2016, the date on which the player terminated the contract, the amount of 601,790,000 as outstanding part of the sign-on fee, as well as three monthly salaries related to the months of July, August and September 2016, in the amount of 10% of 30% of ‘3/008/950/000 net’ each.

11. Consequently, and considering that the club had repeatedly and for a significant period of time been in breach of its contractual obligations towards the player, the Chamber decided that the player had just cause to unilaterally terminate the employment contract on 15 October 2016 and that, as a result, the club is to be held liable for the early termination of the employment contact with just cause by the player.

12. In continuation, having established that the club is to be held liable for the early termination of the employment contract with just cause by the player, the Chamber focused its attention on the consequences of such termination.

13. In this regard, prior to establishing the consequences of the breach of contract with just cause by the player in accordance with art. 17 par. 1 of the Regulations, the Chamber held that it had to address the issue of any unpaid remuneration at the moment the contract was terminated by the club.

14. In his statement of claim, the player alleges that his remuneration relating to July, August and September 2016, according to the player amounting to the total amount of 90,295,500 and a part of the sign-on fee, according to the player the amount of 601,790,000, was to be considered outstanding. The club, for its part, did not contest said allegation and the Chamber established therefore that the club had to pay the aforementioned amount as outstanding remuneration to the player.

15. Consequently, the members of the Chamber determined that the club has to pay the amount of 692,085,500, as well as, considering the player’s claim for interest and also taking into account the Chamber’s longstanding jurisprudence, 5% interest p.a. until the date of effective payment as follows:

a. 5% p.a. as of 21 July 2016 on the amount of 601,790,000;

b. 5% p.a. as of 1 August 2016 on the amount of 30,098,500;

c. 5% p.a. as of 1 September 2016 on the amount of 30,098,500;

d. 5% p.a. as of 1 October 2016 on the amount of 30,098,500.

16. In continuation, the Chamber decided that, taking into consideration art. 17 par. 1 of the Regulations, the player is entitled to receive from the club compensation for breach of contract in addition to any outstanding salaries on the basis of the relevant employment contract.

17. Having stated the above, the Chamber turned to the calculation of the amount of compensation payable to the player by the club 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 player 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.

18. 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.

19. As a consequence, the members of the Chamber determined that the amount of compensation payable by the club to the player 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.

20. Bearing in mind the foregoing as well as the claim of the player, the Chamber proceeded with the calculation of the monies payable to the player under the terms of the employment contract until the end of the 2016/2017 season. Consequently, the Chamber concluded that the amount of 1,414,269,500 (i.e. remuneration as from October 2016 until the end of the season 2016/2017) serves as the basis for the determination of the amount of compensation for breach of contract.

21. In continuation, the Chamber verified as to whether the player 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.

22. According to the information in the TMS, on 21 December 2016, the player found employment with the Club of Country B, Club E. In accordance with the pertinent employment contract which has been made available by the player, valid until 30 September 2017, the player was entitled to receive a monthly salary of 1,500 or approximately 11,711,666. Consequently, the Chamber established that the value of the new employment contract concluded between the player and Club E for the period between 21 December 2016 and 24 May 2017, amounted to 7,500 or approximately 70,270,000.

23. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, the Chamber decided that the club must pay the amount of 1,343,999,500 to the player, which was to be considered a reasonable and justified amount of compensation for breach of contract in the present matter.

24. Moreover, taking into account the player’s request as well as its longstanding jurisprudence, the Chamber decided that the club must pay to the player interest of 5% p.a. on the amount of compensation as of the date on which the claim was lodged, i.e. 22 November 2016, until the date of effective payment.

25. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claim lodged by the player 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 692,085,500 plus 5% interest p.a. until the date of effective payment as follows:

a. 5% p.a. as of 21 July 2016 on the amount of 601,790,000;

b. 5% p.a. as of 1 August 2016 on the amount of 30,098,500;

c. 5% p.a. as of 1 September 2016 on the amount of 30,098,500;

d. 5% p.a. as of 1 October 2016 on the amount of 30,098,500.

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 in the amount of 1,343,999,500, plus 5% interest p.a. on said amount as from 22 November 2016 until the date of effective payment.

4. In the event that the amounts due to the Claimant in accordance with the above-mentioned numbers 2. and 3. are not paid by the Respondent within the stated time limits, 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.

*****

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 / www.tas-cas.org

For the Dispute Resolution Chamber:

Marco Villiger

Chief Legal & Integrity Officer

Encl. CAS directives