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 12 June 2020

Decision of the

DRC Judge

passed on 12 June 2020,

regarding an employment-related dispute concerning the player, Player A

BY:

Daan de Jong (The Netherlands), DRC Judge

CLAIMANT:

Player A, Country B

RESPONDENT:

Club C, Country D

I. FACTS OF THE CASE

1. On 18 February 2019, the Player of Country B, Player A (hereinafter: Claimant / Counter-respondent or player) and the Club of Country D, Club C (hereinafter: Respondent / Counter-claimant or club) concluded an employment contract (hereinafter: contract) valid as from the date of signature until 30 November 2021.

2. In accordance with clause 9 of the contract, the player was entitled to a monthly salary of 7,000, payable “maximum 14 days from the last day of the month in the period where the player is serving his services to the club”.

3. The contract included an “annex 1 of the labor contract” (hereinafter: annex).

4. In accordance with clause 1 of the annex, the player was entitled to the following monthly salaries:

a) USD 1,000 for the period of 18 February 2019 until 30 March 2020;

b) USD 1,500 for the period of 31 March 2020 until 30 March 2021;

c) USD 2,000 for the period of 31 March 2021 until 31 November 2021.

5. By means of clause 11.3 of the contract, the player was, inter alia, obliged to “comply with and act according to the instructions given by the officials of the Club: To participate at all the sportive and commercial events organized by the Club or its partners”.

6. In accordance with clause 14 of the contract, “the club shall establish, through its rules of procedure, the internal disciplinary rules, relevant penalties, damage value for the breaches of the contractual obligations and the procedures applied, which the player has to obey. The club has the obligation to present the player the Rules of procedure and explain its rules.

[…]

If the Player violates any of the obligations under this agreement, the club can apply penalties depending on the gravity of the offence, in accordance with the Rules of procedure of the Club […] The player has the right to appeal the decision on penalties and the right to be accompanied by a lawyer […]”

7. According to the player, on 18 October 2019, the club obliged him to train alone, separated from his teammates. In this context, the player argued that he was subsequently ordered to play official matches with the reserve team, thereby “worsening his labour conditions, while there was no clause in his contract that could oblige him to train with the reserve team, generating an irreparable harm for the player by the conduct unfolded by the club”.

8. As per the player, on 4 November 2019 the club unilaterally terminated the employment contract in writing, and requested the player to compensate the club in the amount of USD 20,000 “for damages”. Along these lines, the player submitted an unsigned document, entitled “Unilateral Termination of Contract for Just Cause”, which stipulated the following: “[The club] decides to terminate the contract with [the player] for just cause. The player repetitively violated contract obligations by refusing to comply with coaching staff instructions, additionally not reporting to club training sessions. According to disciplinary reports, reprimands, fines were registered […] Conforming article 14 of [the Regulations] the club applies for termination of contract between player and club with just cause. Conforming article 17 of [the Regulations] the player is responsible and at origin of the contract termination is liable to pay compensation for damages to the club which is of a total amount of USD 20,000.”

9. On 21 February 2020, the player lodged a claim against the club for breach of contract, requesting compensation in the amount of USD 39,000 corresponding to the residual value of the contract, plus 5% interest p.a. as from “the due dates”.

10. The player further requested the imposition of sporting sanctions on the club.

11. In his claim, the player firstly held that he always complied with all his contractual obligations.

12. The player further argued that the club never opened disciplinary proceedings against him, in order to investigate the alleged misbehaviour prior to unilaterally terminating the contract. In fact, as per the player, the club did not provide any evidence that could demonstrate that he was in breach of the contract.

13. Consequently, the player concluded that the club had terminated the contract without just cause. As such, he is entitled to compensation for breach of contract.

14. In its reply and counterclaim, club firstly rejected the claim of the player and stated that it never issued a unilateral termination of the contract. Having said this, the club did acknowledge that on 18 and on 21 November 2019 it requested FIFA to confirm that the club could terminate the contract with just cause.

15. The club alleged that the player was absent from training from 28 October 2019 and left the country on 4 November 2019. The club further maintained that the player had committed several breaches of the employment contract, submitting in this respect a document entitled “multiple breach report”.

16. The club further provided witness statements from three players affirming that the player did not participate in a specific training session. Thus, the club alleged that the player breached the contract without just cause and lodged a counterclaim against him for compensation in the amount of USD 20,000.

17. According to the club, the amount of USD 20,000 “was an approximate estimation of the costs spent [on] the player; the exact amount is USD 19,702 [as follows]:

- Salaries = USD 7,400

- Bonuses = USD 700

- Flight tickets = USD 1,262,59

- Accommodation = USD 10 per day x 259 hotel days used = USD 2,590

- Feeding […] = USD 13 per day x 250 days of feeding = USD 3,250

- Registration tax for foreign player by Football Federation = USD 4,000, work permit cost USD 500

= USD 19,702 total spent by club on player.”

18. In his replica, the player rejected the club’s counterclaim in its entirety. In particular, the player argued that the club’s intention to terminate the contract is undeniable, given that the “unilateral termination of contract for just cause” of 4 November 2019 is accompanied by a letter signed and stamped by the club.

19. In this light, the letter entitled “Mutual Contract Termination”, signed by the club and submitted by the player in hi replica, contained the following: “The contract signed between the parts on 18 February 2019 that was valid till 30 November 2021, is mutually terminated with the following conditions: “Player” and his new club takes responsibility to recover the amount of EUR 15,000 for compensation of the costs and future transfer value to the “club”. The “player” is able to sign a contract with any club, in term of 2 weeks after the player signs a new contract, the money have to be transferred on the “club” bank account […] Any delay of payment is taxed with 1% per day. “Player” confirms that have no financial, neither other forms claims towards the “club”.”

20. In addition, the player pointed out that both in the “unilateral termination of contract for just cause” and in its counterclaim, the club further requested from him the payment of compensation in the amount of USD 20,000. As per the player, it is thus confirmed that the club requested FIFA to terminate the contract on two occasions. The player therefore concluded that the club’s intention to terminate the contract cannot be denied.

21. The player also stated that he was never been informed of the alleged disciplinary violations the club accused him. In fact, as per the player, these disciplinary violations never took place.

22. The player pointed out that no evidence of such violations or of due disciplinary proceedings was provided by the club, which relied solely on biased statements of club’s players and other employees. In particular, the player denied having been absent from the collective training sessions, as argued by the club, and stated that he was forbidden to join the training sessions given that he was sent to train alone.

23. The player further referred to the wording of art. 14 of the contract, according to which “A) The club shall establish through its rules of procedure, the internal disciplinary rules, relevant penalties, damage value for the breaches of the contractual obligations and the procedures applied, which the player has to obey. The club has the obligation to present the player the rules of procedure and explain its rules”. Along these lines, the player maintained that he was never presented with such rules. Therefore, any disciplinary sanction, if at all existing, would have been the result of flawed and invalid proceedings.

24. Based on the foregoing, the player fully rejected the counterclaim of the club and insisted on his claim.

II. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER (DRC) JUDGE

25. First of all, the Dispute Resolution Chamber Judge (hereinafter also referred to as DRC Judge) analysed 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 21 February 2020. Taking into account 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), the aforementioned edition of the Procedural Rules is applicable to the matter at hand

26. Subsequently, the DRC Judge referred to art. 3 par. 1 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 and par. 2 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players, he 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.

27. Next, the DRC Judge analysed which regulations should be applicable as to the substance of the matter. In this respect, he 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 February 2020, the January 2020 edition of said regulations (hereinafter: Regulations) is applicable to the matter at hand as to the substance.

28. The competence of the DRC Judge and the applicable regulations having been established, he entered into the substance of the matter. In this respect, the DRC 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 he considered pertinent for the assessment of the matter at hand.

29. The DRC Judge first acknowledged that the player and the club signed an employment contract on 18 February 2019 valid until 30 November 2021. Moreover, the DRC Judge recalled that, according to the player, the club unilaterally terminated the contract on 4 November 2019. Similarly, the DRC Judge took into account the club’s position who, inter alia, argued that it never issued the unilateral contract termination.

30. In continuation, the DRC Judge established that the primary issue at stake is determining whether the club unilaterally terminated the employment contract and, if so, on which date and whether it had a just cause to do so. In this respect, the DRC Judge deemed it essential to make a brief recollection of the parties’ arguments regarding the contract termination.

31. In this context, the DRC Judge firstly highlighted that the player had provided two documents both allegedly dated 4 November 2019 entitled “Unilateral Termination of Contract for Just Cause” and “Mutual Contract Termination” respectively. In addition, the DRC Judge recalled that in his replica, the player argued that the club itself acknowledged that it had requested FIFA to terminate the contract on two occasions.

32. Having said this, the DRC Judge noted that according to the club, the player was absent from training from 28 October 2019 and left the country on 4 November 2019. As per the club, the DRC Judge noted, it was the player who had breached the contract, and not the club.

33. Having carefully analysed the documentation provided by the parties, the DRC Judge firstly determined that the club did not provide substantial evidence demonstrating that the player had been in breach of the contract. In particular, the DRC Judge highlighted that all reports and witness statements provided are signed / drafted by employees of the club and are therefore potentially biased.

34. In continuation, the DRC Judge analysed the so-called “multiple breach report” submitted by the club. In this context, the DRC Judge was quick to point out that no evidence of any formal disciplinary proceedings against the player, in which the player would have the right to be heard, was ever provided by the club.

35. Moreover, with regard to the letter entitled “Unilateral Termination of Contract for Just Cause” provided by the player, the DRC Judge established that, in spite of the fact that the club denied having issued said letter, it confirmed having requested FIFA (via its initial claim) to terminate the contract with the player.

36. Furthermore, as regards the letter entitled “Mutual Contract Termination” provided by the player, the DRC Judge placed particular emphasis on the fact that said letter was signed and stamped by the club.

37. In addition, the DRC Judge took into account that the letter titled “Unilateral Termination of Contract for Just Cause” mentions the same amount of compensation requested by the club in its counterclaim, i.e. USD 20,000, and appears to have been issued by the club.

38. Given all of the above considerations, the DRC Judge firstly, concluded that it was the club’s clear intention to unilaterally terminate the employment contract with the player.

39. Secondly, and taking into consideration the request sent by the club to FIFA on 18 November 2019 requesting to confirm that the club could terminate the contract with just cause, the DRC Judge established that the club unilaterally terminated the contract with the player on 18 November 2019.

40. Having established the above, the DRC Judge then proceeded to answering the question of whether the club had a just cause to terminate the contract on 18 November 2019.

41. In this context, the DRC Judge firstly recalled that, with regard to the player’s alleged misbehaviour, no evidence of any formal disciplinary proceedings against the player, in which the player would have the right to be heard, was ever provided by the club.

42. In fact, the DRC Judge referred to the principle of the burden of proof explicitly stipulated in art. 12 par. 3 of the Procedural Rules, and stressed that the club had not submitted any convincing documentary evidence which could demonstrate that the unilateral contract termination was justified.

43. Thus, taking into account all of the above considerations, the DRC Judge determined that the club terminated the employment contract on 18 November 2019 without just cause.

44. Consequently, the DRC Judge decided to fully reject the club’s argumentation and counterclaim.

45. That said, the DRC Judge concluded that the club is to be held liable for the early termination of the employment contract without just cause and should therefore bear the consequences of its unjustified breach of the employment contract.

46. In continuation, the DRC Judge focused his attention on the calculation of the amount of compensation for breach of contract payable by the club to the player in the case at stake. In doing so, the DRC Judge first 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.

47. In application of the relevant provision, the DRC Judge held that he 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 DRC Judge established that no such compensation clause was included in the employment contract at the basis of the matter at stake

48. As a consequence, the DRC Judge 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 DRC Judge 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 DRC Judge emphasized beforehand that each request for compensation for contractual breach has to be assessed on a case-by-case basis taking into account all specific circumstances of the respective matter.

49. In order to estimate the amount of compensation due to the player in the present case, the DRC Judge first turned his attention to the remuneration and other benefits due to the player under the existing contract and/or the new contract(s), which criterion was considered to be essential. The DRC Judge deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows him to take into account both the existing contract and the new contract, if any, in the calculation of the amount of compensation.

50. Bearing in mind the foregoing, the DRC Judge proceeded with the calculation of the monies payable to the player under the terms of the employment contract as from its date of termination without just cause by the club, i.e. 18 November 2019, until 30 November 2021, and concluded that the player would have received 175,000 and USD 39,000 in total as remuneration had the contract been executed until its expiry date. Consequently, the DRC Judge concluded that the amount of 175,000 and USD 39,000 serves as the basis for the final determination of the amount of compensation for breach of contract in the case at hand.

51. In continuation, the DRC Judge 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 able 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 termination of contract with just cause in connection with the player’s general obligation to mitigate his damages

52. Having said this, the DRC Judge noted that according to the information on file, the player has remained unemployed since terminating the contract with the club on 18 November 2019.

53. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, the DRC Judge concluded that the player would be entitled to the amount of 175,000 and USD 39,000 as compensation for breach of contract.

54. Having said this, the DRC Judge noted that in his claim, the player had limited his request for compensation for breach of contract to the amount of USD 39,000. Therefore, the DRC Judge decided that the club must pay the amount of USD 39,000 to the player as compensation for breach of contract.

55. In addition, taking into account the player’s request, the DRC Judge 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. 21 February 2019, until the date of effective payment.

56. Furthermore, taking into account the consideration under number 27 above, the DRC Judge 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.

57. In this regard, the DRC Judge established that, in virtue of the aforementioned provision, he has competence to impose a sanction on the club. More in particular, the DRC Judge 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.

58. Therefore, bearing in mind the above, the DRC Judge decided that, in the event that the club does not pay the amount due to the player within 45 days as from the moment in which the player, following the notification of the present decision, communicates the relevant bank details to the club, 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 club in accordance with art. 24bis par. 2 and 4 of the Regulations.

59. Finally, the DRC Judge 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.

60. The DRC Judge concluded its deliberations in the present matter by establishing that the player’s claim is accepted. Furthermore, the DRC Judge concluded that the counterclaim of the club is rejected.

III. DECISION OF THE DISPUTE RESOLUTION CHAMBER

1. The claim of the Claimant / Counter-respondent, Player A, is accepted.

2. The Respondent / Counter-claimant, Club C, has to pay to the Claimant / Counter-respondent the amount of USD 39,000 plus interest of 5% p.a. as from 21 February 2020 until the date of effective payment.

3. The counterclaim of the Respondent / Counter-claimant is rejected.

4. 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.

5. The Respondent / Counter-claimant 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).

6. In the event that the amount due, plus interest as established 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, the following consequences shall arise:

 1.

The Respondent / Counter-claimant 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.

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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