By Stephen G. Bock, Esq.
On January 30, 2015, FIFPro, the worldwide representative organization for all professional soccer players (i.e. soccer players union), suspended negotiations with the European Clubs’ Association (“ECA”) and the European Professional Football Leagues (“EPFL”) regarding four amendments to the FIFA Regulations on the Status and Transfer of Players (“FIFA RSTP”), which the ECA and EPFL refused to endorse to FIFA. The FIFPro amendments provided:
1. That a player who is unpaid for more than 30 days can elect to terminate his contract if he has given his club at least 10 days written notice to pay what is owed;
2. That if a player contract is terminated by a club without just cause or by the player for non-payment, the player will be entitled to be financially compensated by having the contract paid out by the club;
3. That such a player be able to find work without restriction including outside of any transfer window; and
4. The reforms apply both internationally and domestically.
While the FIFPro amendments address what it considers an important issue in international soccer, the clubs’ lack of respect for their contractual obligations to their players. As proof of this issue, FIFPro cites approximately 4,000 players who file cases with FIFA every year for nonpayment of salary or unjust contract termination.
However, I contend that the proposed amendments fail to address the real issue: the inefficiency of the FIFA Dispute Resolution Chamber (“FIFA DRC”), FIFA’s arbitration system for handling these disputes.
The first two amendments detailed above are generally negotiated terms that appear frequently in contracts in the larger sports, including international soccer. By seeking to add these provisions to the FIFA RSTP, FIFPro intends to extend salary protections to those players whose contracts do not contain these salary protections. However, one must ask himself or herself, if some clubs are not honoring the provisions in the contract, why would they honor the provision in the RSTP? Indeed, simply adding the salary protections to the FIFA RSTP would not ensure that a club would not either (a) contest a contract termination initiated by a player on the basis of non-payment of compensation or (b) maintain that it terminated a player for just cause potentially resulting in no compensation being due. At the end of the day, issues of termination are not always clear-cut and, often, one side contests the termination resulting in the matter being sent to FIFA DRC anyway.
According to FIFPro, due to the volume of cases, players currently wait several years for a hearing. Once the FIFA DRC hears the dispute and renders a decision, over 90 percent of the matters are decided in favor of the player. As a result, clubs do exploit these arbitration delays to avoid payment of compensation to players.
In my two years of experience working on Court of Arbitration for Sport appeals in soccer financial disputes, I have seen first-hand that the FIFA DRC cases can take five years to resolve relatively simple financial disputes. The procedure itself is not the problem because it is relatively streamlined with each party being permitted only one or two written submissions and most cases being decided “on the papers” alone. The true reason for the extensive FIFA DRC delays appears to be the FIFA DRC’s inability to promptly set deadlines for written submissions, force the parties (of their representatives) to honor those deadlines. Likewise, the FIFA DRC arbitrator panel can take a long time to issue a reasoned decision. Consequently, the reality is that the FIFA DRC procedure takes too long which allows clubs to delay payment of outstanding salaries to players.
In conclusion, while FIFPro is seeking to make fair amendments to the FIFA RSTP, these amendments do not address the real issue in player compensation disputes: the FIFA DRC’s failure to promptly handle and decide these disputes.