Τhe football industry is on an ever-increasing upward trend and the sportsmen (in our case the football players and the football coaches) enjoy the outcome of this commercial evolution by receiving attractive wages and signing profitable employment contracts. The question arises whether “this is the real or the whole picture for this industry”?
Football industry, like every other commercial industry, constantly faces challenges which derive from the non-fulfilment of the contractual obligations of the parties in the employment contracts and the incorporation in these of ambiguous clauses which need to be determined before the domestic football courts/judicial committees or at international level before Court for arbitration of Sports (CAS). This tendency illustrates the necessity for receiving specialized legal advice for the drafting of football employment agreements in order to ensure the inclusion of essential terms, the clarity concerning the obligations of each party and hence the minimization of the ambiguities.
In this article we will provide a basic outline of the minimum essential clauses that should be included in a football employment agreement.
Football employment agreements should define a specific duration (the commencement and ending date should be clearly defined) and, as in every other contractual agreement, they should stipulate an amount as a consideration for the ‘’services’’ provided by the athlete/coach. In football contracts, this consideration reflects the salaries of the athletes which are calculated on a weekly or monthly basis and in most of the cases are supplemented by certain additional benefits such as a special bonus related with the fulfilment of the club’s goals or based on the appearances of the athlete. Some additional non-financial emoluments can also include the provision of accommodation, transportation, etc.
The obligations of the parties
Certain, minimum obligations/duties of the player include his ability to participate in a football match following the relevant “call” from his coach, to participate in the club’s training sessions, to behave in a professional manner, that will not affect his performance, to follow the regulations and the laws of the game as these are defined by the national federations, to maintain a healthy lifestyle, to undergo regular medical examinations and to comply with the club’s internal rules.
As a bilateral agreement, any sports contract, such as a football contract, should also define the obligations/duties of the club, which essentially include the obligation to timely pay the wages/emoluments, to provide medical and health insurance and, in general, to comply with all the terms of the agreed contract.
It is worth noting that the minimum obligations of both the parties have been codified in the Autonomous Agreement regarding Minimum Requirements for Standard Player Contracts in the Professional Football Sector, which has been agreed to between the parties of the European Social Dialogue, namely EPFL, ECA (European Club Association), FIFPro (the Player’s Association) and UEFA. This codified agreement constitutes an essential part of the contract employment agreement between the club and the athlete/coach.
Taxes / Social Insurance Contribution
The athlete/coach is treated by the legislation as any other employee. In this respect, a sport’s contract should contain the relevant clause obligations of the relevant party (in most of the cases, the club) to pay the relevant amounts which will arise from the agreement to the respective tax/social insurance authorities. The absence of these clauses creates ambiguity and a non-payment of the relevant taxes/social insurance will constitute a criminal offence.
Termination of the Football Contract/Release Clauses
The termination clause in a football contract is one of the most well-negotiated clauses of the agreement. A football contract is terminated following the expiry of the agreed term. In some contracts, there is a renewal clause which may extend the term of the agreement following the exercise of the clause by the club. A termination clause may also include the right of the club to terminate the agreement, prior to the expiration of the agreed term, subject to the payment of a specific amount or the right of the athlete/coach to be released from his obligations with the club, subject to the payment of a specific fee, which in most cases is paid by another club wishing to employ the athlete. It is noted that certain national regulations provide separate rules in terms of the release of an athlete or a coach. For example, in Cyprus, if a coach unilaterally terminates the football contract between himself and the club, he will be restricted from being employed at any other club in Cyprus until the beginning of the following football season. In such cases, it is essential for a termination clause to be included in the main agreement, which will provide the option to the coach to terminate the agreement and hence to be considered as the exercise of a right which has been mutually pre-agreed between the parties. Therefore, the relevant restriction will not be applicable and the coach will be free to be employed by any other club.
It is noted that the aforementioned clauses constitute the minimum essential clauses that should be agreed within a football contract. Many other terms such as the image rights of an athlete or a transfer fee may be included. As already mentioned, the absence of specialized legal advice, may result in a poorly drafted contract which may lead to a time-consuming dispute between the parties and subsequently to affect the parties’ rights.
Michael Kyprianou & Co LLC has a leading Sports Law practice with a team of experienced lawyers who are able to advise and assist clients in relation to every aspect of Sports Law. The content of this article is valid as at the date of its first publication. It is intended to provide a general guide to the subject matter and does not constitute legal advice. We recommend that you seek professional advice on your specific matter before acting on any information provided. If you need any advice or further information in relation to the aforementioned article you may contact Kyriakos Constantinou at Kyriakos.Constantinou@kyprianou.com or at +357 25 363685