Al Shabab Club v. Makhete Diop

V. Grant any other relief or orders it deems reasonable and fit to the case at stake”.

V. JURISDICTION

46. Article R47 CAS Code provides as follows:

“An appeal against the decision of a federation, association or sports-related body may be filed with CAS if the statues or regulations of the said body so provide or if the parties have concluded a specific arbitration agreement and if the Appellant has exhausted the legal remedies available to it prior to the appeal, in accordance with the statutes or regulations of that body”.

47. Article 58(1) FIFA Statutes (May 2021 edition) provides as follows:

“Appeals against final decisions passed by FIFA’s legal bodies and against decisions passed by confederations, member associations or leagues shall be lodged with CAS within 21 days of notification of the decision in question”.

48. The jurisdiction of CAS in the present case derives from Article 58(1) FIFA Statutes and Article R47 CAS Code and it is further confirmed by the Order of Procedure duly signed by the Parties. It follows that CAS has jurisdiction to adjudicate and decide on the present appeal.

VI. ADMISSIBILITY

49. The appeal was filed within the deadline of 21 days set by Article 58(1) FIFA Statutes. The appeal complied with all other requirements of Article R48 CAS Code, including the payment of the CAS Court Office fee.

50. It follows that the appeal is admissible.

VII. APPLICABLE LAW

51. The Club argues that pursuant to Article R58 CAS Code and Article 57(2) FIFA Statutes, the FIFA regulations and alternatively Swiss law applies. The Player did not provide any position on the applicable law.

52. Article R58 CAS Code provides as follows:

“The Panel shall decide the dispute according to the applicable regulations and, subsidiarily, to the rules of law chosen by the parties or, in the absence of such a choice, according to the law of the country in which the federation, association or sports-related body which has issued the challenged decision is domiciled or according to the rules of law, the application of which the Panel deems appropriate. In the latter case, the Panel shall give reasons for its decision”.

53. Article 57(2) FIFA Statutes stipulates the following:

“The provisions of the CAS Code of Sports-Related Arbitration shall apply to the proceedings. CAS shall primarily apply the various regulations of FIFA and, additionally, Swiss law”.

54. The Panel notes that clause 3 of the Employment Contract provides as follows:

“The two parties shall comply with and implement the laws, circulars and regulations issued by SAFF, FIFA, the Confederation and Saudi professional league”.

55. In addition, clause 13(1) and (4) of the Employment Contract provide as follows:

“1. The two parties declare that they have taken note of SAFF and FIFA regulations and circulars before signing this contract, and that they are obliged to implement them.

4. The provisions of Professional Player’s status and transfer regulations shall apply to all matters not provided for in this contract”.

56. In light of the above-mentioned provisions and given that neither of the Parties relies on any regulations issued by SAFF, the Panel finds that the various regulations of FIFA are applicable in the present dispute and that Swiss law shall be applied subsidiarily, should the need arise to fill a possible gap in the various rules and regulations of FIFA. More specifically, and also considering that the case concerns a dispute concerning the performance of an employment contract under the circumstances of the COVID-19 pandemic, the Panel applies the relevant provisions of the FIFA Regulations on the Status and Transfer of Players (the “FIFA RSTP”) in conjunction with the FIFA COVID-19 Guidelines and the COVID-19 Frequently Asked Questions document issued by FIFA on 11 June 2020 (the “FIFA FAQ COVID-19 Document”).

VIII. MERITS — A. The Main Issues

57. The Club expressly confirmed that its appeal only relates to the alleged outstanding remuneration during the COVID-19 period, more precisely the alleged outstanding remuneration for the months of March, April, May, June and July 2020, concerning a total amount of EUR 521,115.

58. The other amounts awarded to the Player by the FIFA DRC in the Appealed Decision are not disputed by the Club and are therefore not specifically addressed in this award.

59. As such, the central issue of contention in this dispute is whether the Club was entitled to unilaterally temporarily vary the financial terms of the Employment Contract, and effectively pay the Player reduced monthly salaries in the relevant period, as a result of the outbreak of the COVID-19 pandemic and the subsequent shutdown of all football activities in the Kingdom of Saudi Arabia.

60. In this respect, the arguments submitted by the Club are that (i) the Player agreed to the reduction, or at least did not object to it, and (ii) that the payment of reduced salaries during the COVID-19 pandemic was legally permitted even without the Player’s prior agreement or consent.

(i) Did the Player agree to the salary reduction?

61. The Club argues that the Player – as all players of the Club – agreed to reduce his salary, as he received the Club’s correspondence related to the Club’s intention to reduce his salaries, that he was not willing to negotiate with the Club, that he did not contact the Club, that he agreed with the reduction as he never objected to it, but only objected to the applied reduction after the termination of the Employment Contract.

62. To support its stance, the Club relied on the testimonies of four witnesses.

63. Mr Mohamed Shata, the Club’s General Director, inter alia, explained that as from 14 March to 21 June 2020 all training sessions and matches of the Club were suspended, and that the Player remained in the Kingdom of Saudi Arabia, receiving video-trainings. The normal trainings resumed on 21 June 2020 and the football season restarted in August 2020. During this period, the Club lost income (SAR 1,000,000 per suspended match, no government support). He confirmed that only the contract with Innodev Company with a value of SAR 2,000,000 – corresponding to approximately EUR 500,000 – was terminated due to the COVID-19 pandemic. On 17 April 2020, the Club wrote a letter to the Player to negotiate about the FIFA COVID-19 Guidelines, but the Player did not reply. The Club tried to arrange a video-conference between the Club’s President, the Club’s Translator, and the Player, but the latter did not accept. Mr Shata further stated that 75% of the players accepted the 50% salary reduction by signing an agreement, and that 25% accepted the salary reduction by not

objecting against it. He argued that the Player was the only employee filing a claim against the Club, and only after the termination of the Employment Contract by the Club.

64. Mr Tarik Benjdia, the Club’s Translator, inter alia, stated that the salary reduction was applied to all players, staff, coaches and other employees, and that he contacted all (foreign) players by phone and by email on this issue. He stated that all players accepted the reduction. More specifically, he stated that he attended a video-conference with the Club’s President and the Player, which meeting was held after 17 April 2020, during which the Player agreed to a 50% reduction of his salaries for about 3 months (March, April, May 2020). He indicated that, in his view, the Player agreed because he did not object.

65. Mr Majed Al Marzoqi, the Club’s Professional Manager, inter alia, confirmed that the salary reduction was applied to all players, coaching staff, administrative personal and all other employees, and that nobody objected to it or presented concerns. He did not talk with the Player himself, but the captain of the Club’s first team informed him by telephone that all players accepted the reduction. From the total of 30 players (of which 6 or 7 were foreign players), 23 players (most local, 2 foreign players) signed the reduction agreement.

66. Mr Walid Mahmoud Al Badry, the Club’s Financial Manager, inter alia, confirmed that the Club’s financial position before COVID-19 was stable and that the Club was committed to paying the salaries in time. There were 7 foreign players in the squad taking 65% of the total budget during the relevant period. He stated that the salary reduction was applied to all employees of the Club, that each player (and each employee) was paid SAR 20,000 and that the rest of their salary was deducted by 50%. Furthermore, he explained the negative impact of the COVID-19 pandemic on the Club’s revenues, providing the following breakdown of loss of income in the amount of SAR 37,000,000:

- loss of one sponsor (Innodev Company): SAR 2,000,000;

- loss of income tickets/fans: SAR 8,000,000;

- loss of government support: SAR 20,000,000;

- loss of SPL support: 7,000,000.

67. The Player testified that he participated in a video-conference and that afterwards he received the Club’s letter dated 14 April 2020. He stated that he did not sign the reduction agreement, because he did not agree with the reduction, and that he never spoke with the Club about money, always referring the Club to his agent to discuss monetary business. He stated that, to his knowledge, also other foreign players did not agree with the reduction.

68. Whereas the Player denies having agreed with the reduction, the Club argues that he did.

69. Entering into this analysis, the Panel first of all considers it necessary to determine who bears the burden of proof.

70. Article 12(3) of the FIFA Rules governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (the “FIFA Procedural Rules”) provides as follows:

“Any party claiming a right on the basis of an alleged fact shall carry the burden of proof”.

71. Furthermore, also the subisidiarily applicable Article 8 of the Swiss Civil Code provides as follows:

“Unless the law provides otherwise, the burden of proving the existence of an alleged fact shall rest on the person who derives rights from that fact”.

72. The Panel reaffirms the principle established by CAS jurisprudence that “in CAS arbitration, any party wishing to prevail on a disputed issue must discharge its burden of proof, i.e. it must meet the onus to substantiate its allegations and to affirmatively prove the facts on which it relies with respect to that issue. In other words, the party which asserts facts to support its rights has the burden of establishing them. The Code sets forth an adversarial system of arbitral justice, rather than an inquisitorial one. Hence, if a party wishes to establish some facts and persuade the deciding body, it must actively substantiate its allegations with convincing evidence” (CAS 2014/A/3546, para. 7.3 and references).

73. In general, the burden of proof is satisfied whenever the judge is convinced of the truthfulness of a factual allegation based on objective grounds. Absolute certainty is not required. It is sufficient if the judge has no serious doubt about the existence of the alleged facts or if any remaining doubt appears to be tenuous (ATF 130 III 321, consid. 3.3).

74. As such, the Panel finds that the burden of proof to establish the alleged agreement lies with the Club, since the Club is the party claiming that – because of this alleged agreement – it is not obliged to pay the Player’s full salaries as defined in the Employment Contract.

75. The main evidence relied on by the Club in this respect is its letter dated 17 April 2020 in which the Player’s verbal agreement is allegedly confirmed, in conjunction with the witness statements, in particular of the Club’s Translator and the Club’s Professional Manager.

76. By its letter dated 17 April 2020, the Club maintains to have informed the Player of its decision to temporarily reduce his salaries by, inter alia, referring to “the phone conversation with you regarding the reduction of the monthly salary wage during the period of the stoppage of sport activity until the clearance of Corona’s epidemic, and your verbal agreement on this matter”.

77. The Player denies the existence of any verbal agreement and did not confirm receipt of this letter, but stated at the hearing that during the video-conference with the Club, he referred the Club to his agent to discuss monetary issues.

78. The Panel notes that it is dubious whether the Player received the Club’s letter dated 17 April 2020. The Club issued an email to the Player on this date, but whereas the attachment to the email is titled “Notice 0001”, the letter allegedly attached contains the reference number “1455”. The letter is also not countersigned by the Player, nor was the Player requested to countersign the letter or to acknowledge receipt.

79. The Panel further finds that, even if the Player had received the Club’s letter dated 17 April 2020, the Player’s silence or failure to object can still not reasonably be understood as his acceptance of the Club’s unilateral variation of the Employment Contract.

80. The Player testified that he informed the Club that any financial matters should primarily be addressed to his agent, which the Panel considers to be a credible and reasonable position, but that there is no evidence on file that the Club ever contacted the Player’s agent with respect to the unilateral contractual variation.

81. Furthermore, also the factual circumstances concerning the telephone conversation referred to in the Club’s letter dated 17 April 2020 are unclear.

82. The only witness presented by the Club who had direct contact with the Player on the issue of the salary reduction was the Club’s Translator, Mr Benjdia, who stated that during a videoconference with the Club’s President, held after 17 April 2020, the Player did not object to a 50% reduction of his salaries for about 3 months (March, April, May) and by not objecting, in his view verbally agreed with the reduction. This timing is not consistent with the reference in the Club’s letter dated 17 April 2020.

83. The Panel finds that Mr Benjda’s testimony falls short of proving the Player’s consent, as not objecting is not the same as agreeing.

84. The Panel finds that the Club cannot rely on Mr Majed Al Marzoqi’s statement at the hearing that the reduction was applied to all players, coaching staff, administrative personal and all other employees, and that nobody objected to it or presented concerns, and that the captain of the Club’s first team informed him by telephone that all players accepted the reduction, because such allegation is not corroborated by any documentary evidence. Mr Al Marzoqi confirmed that he did not personally speak with the Player and the Club did not call the captain of the Club’s first team as a witness, despite his alleged knowledge of the Player’s consent to the salary reduction, which undermines the Club’s reasoning.

85. Further, Mr Benjdia referred specifically to a video-conference held after 17 April 2020, which video-conference does not appear to make sense if the relevant telephone call had taken place on or before 17 April 2020 and taking into account the content of the notice, nothing was left to be negotiated.

86. The Panel observes that it is undisputed that the Player did not sign any reduction agreement. There is no credible evidence of a telephone call and/or video-conference between Mr Benjdia (or any other Club representative) with the Player in which the Player expressly gave his consent to the salary reduction. Further, the fact that the Club did not call its President as a witness despite his alleged involvement in the video-conference with the Player (and the Club’s first team captain as explained supra) undermines the Club’s case.

87. Taking into account all facts and circumstances, the Panel is not convinced to any level of satisfaction that the Player consented to the salary reduction.

(ii) Was the Club entitled to vary unilaterally the financial terms of the Employment Contract

88. In the absence of the Player’s consent to temporarily vary the terms of the Employment Contract, the remaining question to be addressed by the Panel is whether the Club was entitled under the circumstances to unilaterally vary the terms of the Employment Contract.

89. In this respect, the Club argues that the FIFA DRC “erred in its application of the FIFA Circular 1714” and the FIFA COVID-19 Guidelines enclosed thereto. The Club submits that the reduction was applied to all players and staff, and that all players were “updated via circular no. 173 on 11 June 2020, which included the amendments made by the Saudi Arabian Ministry of Human Resources and Social Development, which made amendments to the Saudi Labour Law, enabling businesses to reduce the salaries of employees with a limited reduction not exceeding 40% […]”.

90. As mentioned above, Mr Walid Mahmoud Al Badry, the Club’s Financial Manager, explained the negative impact of the COVID-19 pandemic on the Club’s revenues, providing the following breakdown of loss of income in the amount of SAR 37,000,000:

- loss of one sponsor (Innodev Company): SAR 2,000,000;

- loss of income tickets/fans: SAR 8,000,000;

- loss of government support: SAR 20,000,000;

- loss of SPL support: 7,000,000.

91. At the hearing, Mr Mohamed Shata, the Club’s General Director, explained that during the relevant period the Club lost income (SAR 1,000,000 per suspended match and loss of government support), and confirmed that only the contract with Innodev Company with a value of SAR 2,000,000 – corresponding to approximately EUR 500,000 – was terminated due to the COVID-19 pandemic.

92. For these reasons, on 17 April 2020 the Club notified the Player of its decision to implement salary cuts effective from 15 March 2020 until “resuming the sport activity and training and the end of Corona epidemic outbreak”. The Club maintains that this decision was made in accordance with all requirements set forth in FIFA Circular no. 1714, that allowed it to unilaterally vary the Employment Contract as a result of the pandemic, and was thus binding on the Player. It therefore argues that by paying the reduced amounts it had duly discharged its financial obligations vis-à-vis the Player regarding the relevant period. The Club stresses that it was a chaotic period in which it did its utmost to keep everybody employed, staying within the applicable rules and regulations.

93. The Player, on the other hand, argues that the Club up until now not even paid him the undisputed amounts granted by the FIFA DRC and therefore is not acting in good faith. The Player maintains that he did not accept the salary reduction and that the Club did not fulfil the conditions provided in the FIFA COVID-19 Guidelines that could allow it to amend unilaterally the Employment Contract. As such, the Club still owes him all the amounts due,

including part of his salary for March, April, May, June and July 2020 as granted by the FIFA DRC.

94. As already pointed out, the Panel primarily decides this case on the basis of the FIFA RSTP and the guiding principles set forth in the FIFA COVID-19 Guidelines and the FIFA COVID-19 FAQ Document.

95. The FIFA RSTP are silent with respect to contractual variation, but the topic is addressed in the FIFA COVID-19 Guidelines and the FIFA COVID-19 FAQ Document. The FIFA COVID-19 Guidelines in turn refer to national law, i.e. “[u]nilateral decisions to vary agreements will only be recognised where they are made in accordance with national law or are permissible within CBA structures or another collective agreement mechanism”.

96. However, the key rationale of the guidance provided by FIFA is that clubs and players first seek to find a collective agreement on contractual variation. As set forth in the FIFA COVID- 19 Guidelines, “[c]lubs and employees (players and coaches) be strongly encouraged to work together to find appropriate collective agreements on a club or league basis regarding employment conditions for any period where the competition is suspended due to the COVID-19 outbreak”.

97. The FIFA COVID-19 Guidelines contain a set of principles and recommendations with the aim of addressing situations where employment agreements cannot be performed as originally anticipated by the parties due to the COVID-19 crisis. In principle, the FIFA COVID-19 Guidelines advocate strongly for a spirit of cooperation and consensus, encouraging the parties to reach amicable settlements. Only in case no collective agreement can be reached, they propose that unilateral contract amendments shall be upheld if recognized by national law, or, in case national law is not relevant, (i) if made in good faith; (ii) if they are reasonable; and (iii) proportionate.

98. In view thereof, the Panel shall review whether in the specific circumstances of this case, the Club’s decision to temporarily reduce the Player’s monthly salary instalments by 50% or by any percentage was actually made in good faith, namely in a spirit of honesty and fairness, and also whether it was reasonable and proportionate, namely whether it was dictated by a sound economic rationale. For this purpose, and in line with the indicative criteria set out in FIFA COVID-19 Guidelines, the Panel shall examine the following set of issues:

- the steps taken by the Club with a view to reach an agreement with the Player before applying unilateral salary cuts;

- the consequences of the COVID-19 pandemic on the Club’s financial situation in the period from March until July 2020 and the degree of disruption caused to contract performance;

- the size of the salary reduction and the economic purpose served thereby;

- the Player’s overall economic situation, and,

- the uniform application of similar pay cuts on the entire squad.

99. On the first point, the Panel observes that the Club had informed the Player via a letter dated 14 April 2020 that “as suggested by FIFA, we intend to work with our playing squad in order to consider any necessary amendments to contractual terms including those concerning remuneration. In line with this, we will be contacting all of our players in order to undertake discussions”.

100. There is no evidence that the Club conducted or tried to conduct any negotiations with the players collectively to come to a wholesale agreement.

101. There is also no evidence on file that the Club contacted the Player or tried to negotiate with the Player before sending him a notice on 17 April 2020, in which notice the Club informed the Player of its decision to reduce his salary, referring to a phone call with the Player in which he had allegedly agreed with the reduction. Although the Club submits that the Player was also informed of the Club’s decision by the Club’s Translator “on or about the same date”, the Club’s Translator at the hearing confirmed that he attended a video-conference between the Club’s President and the Player, which meeting was only held after 17 April 2020.

102. On this basis, the Panel is not satisfied that the Club was clear and straightforward in its intentions to negotiate with the Player or that it had taken all the necessary steps to initiate some sort of negotiations in good faith in the hope to reach a mutual agreement on the matter prior to unilaterally deciding to cut the Player’s wages.

103. In the absence of a good faith attempt from the Club to reach a collective agreement with its players, the Panel finds that national law does not come into play.

104. However, even presuming that the Club had engaged in a good faith discussion with its players to reach a collective agreement but that this turned out to be unsuccessful and that therefore national law does came into play, quod non, the Panel finds that the Club failed to establish that the unilateral variation of the Employment Contract was in accordance with Saudi Labour Law.

105. On the Club’s limited submissions under domestic law, it maintains that the Saudi Arabian Ministry of Human Resources and Social Development made amendments to the Saudi Labour Law, enabling businesses to reduce the salaries of employees with a limited reduction not exceeding 40%.

106. First of all, the Player’s salary above SAF 20,000 (approximately EUR 5,000) was reduced with 50%, which clearly exceeds the discretion allegedly afforded to the Club by the Saudi Arabian Ministry of Human Resources and Social Development, given that the Player was entitled to a monthly salary of EUR 222,223.

107. Second, the potential reduction of salary may not exceed 40%. The reference to 40% is therefore not to be interpreted as a right of the Club that can be exercised at will, but it is an absolute maximum that may be applied if the circumstances so warrant. Any reduction unilaterally applied therefore requires a justification, because, for example, it would be unfair if the Club’s income was reduced with only 10%, but if it would nonetheless apply a 40% reduction of the players’ salaries.

108. The Club however did not provide any evidence justifying the reduction applied, not at the time of the unilateral variation and not in the present proceedings.

109. As to the consequences of the first outbreak of COVID-19 in March 2020 and the restrictions imposed in each country on almost all economic activities for the protection of public health created an unforeseen and extraordinary situation that affected the performance of employment contracts in many sectors of the economy worldwide, including the football industry. Having said so, the Panel is mindful that in the introduction of its FIFA COVID-19 FAQ Document, FIFA clarified that the pandemic should not be considered by clubs and employers in football as a force majeure situation in general, but that the situation is rather to be assessed on a case-by-case basis, in light of the particular circumstances of each individual employment relation, and, each country. Consequently, for FIFA the COVID-19 pandemic is not a situation of force majeure in and of itself.

110. Although the Club did not explicitly invoke a situation of force majeure in its submissions, it referred to FIFA Circular no. 1714, by means of which FIFA informed its members that the Bureau of its Council recognised that the disruption to football caused by COVID-19 was a case of force majeure and declared “[t]he COVID-19 situation is, per se, a case of force majeure for FIFA and football”.

111. The Panel finds that the Club cannot rely on the afore-mentioned circular, as the ambiguity that arose from that document was quickly addressed by FIFA with FIFA Circular no. 1720, as in the attached FIFA COVID-19 FAQ Document, it was made clear that “clubs or employees cannot rely on the Bureau decision to assert a force majeure situation (or its equivalent)” (emphasis added by FIFA) and that each situation in each country had to be assessed separately, on a case-bycase basis.

112. Therefore, the Panel holds that the Club cannot simply invoke the COVID-19 pandemic as a generic defence of force majeure or as a reason to not comply with its financial obligations as agreed upon in the Employment Contract, without substantiating exactly how the pandemic affected its financial situation to such extent that it had rendered the performance of the Employment Contract impossible.

113. Besides, according to a general and well accepted definition formulated by previous CAS Panels “force majeure implies an objective (rather than a personal) impediment beyond the control of the obliged party that is unforeseeable, that cannot be resisted and that renders performance impossible” (CAS 2013/A/3471, para. 49). In addition, according to a consistent approach taken by CAS case law, the conditions of force majeure should be interpreted strictly and narrowly, since they may introduce an exception to the binding force of an obligation (CAS 2013/A/3471, para. 50; CAS 2015/A/3909, para. 74). The onus of proof in this respect lies with the Club.

114. The Club submitted a termination letter dated 24 April 2020 of Innodev Company, one of its sponsors, and referred to the witness statements of its General Director and its Financial Manager, suggesting that the Club’s loss of income due to the COVID-19 pandemic amounted to SAR 37,000,000.

115. As to the alleged loss of income of SAR 37,000,000, the Panel finds that the Club failed to corroborate such statements with any evidence besides the testimonies of its General Director and Financial Manager.

116. As to the termination of the Innodev Company sponsorship agreement, the Club did not submit the sponsor agreement with Innodev Company into evidence. While the Panel considers the information presented by the Club to be credible and reasonable and finds that this probably had a negative impact on the Club’s financial situation, it failed to prove what impact the termination of the Innodev Company sponsorship agreement had on the Club’s overall financial situation. The Club may have had several more important revenue streams that remained unaffected, or it may have received support from the Government of the Kingdom of Saudi Arabia.

117. Notwithstanding these considerations and some financial hardship encountered by the Club, the Club failed to prove how the drop in revenues as a consequence of Innodev Company’s termination had derailed the Club’s financial planning to such an extent that the performance of the Employment Contract was no longer possible in the way originally envisaged or otherwise justified a variation of the Employment Contract. In other words, the Club is required to show more than a general economic difficulty in abstract terms. It has to show a real disruption in its financial operation and a total lack of alternative resources that had made it impossible to fulfil its payment obligations to the Player by for instance filing its financial statement for 2020, which could be a fundamental piece of evidence to establish whether or not it was objectively impossible for the Club to fully comply with its financial obligations towards the Player. In addition, for the players to know whether a 50% reduction was justified or needed, and how the Club arrived at such a reduction percentage, the Club should have produced a report at the time of sending the first letter on 14 April 2020, predicting the expected effects of the pandemic and showing why the players needed to accept such a reduction (i.e. the Club would fall into insolvency otherwise, as there was no other alternative funding available etc). The Panel could understand that an arbitrary cut, without any financial report justifying the same, could be difficult to accept for the players.

118. In the absence of more specific information or data, other than the temporary drop in its revenues, the Club did not prove sufficiently that the COVID-19 pandemic had put such a tremendous strain on its finances that it threatened its solvency and its financial viability. In this respect, it is worth noting that, at the hearing, Mr Walid Mahmoud Al Badry, the Club’s Financial Manager, confirmed that the Club’s financial position before COVID-19 was stable, and that the Club, in its email to the Player dated 18 January 2021, wrote that “the club has finalised and closed sponsorship deals which cash injections will be made over the next few month”. Similarly, the Panel finds no evidence to suggest that during the lockdown period the Club was essentially deprived of any access to alternative sources of liquidity, either via bank lending, or state aids, or through private and public financing, or through the use of contingency funds. Hence, in the circumstances invoked, the Panel finds that the financial operation of the Club was not shown to have been disrupted to an extreme effect.

119. As a matter of fact, it remained undisputed that during the period between 14 March 2020 (start suspension) and 21 June 2020 (restart training on the pitch) the Player remained in the

Kingdom of Saudi Arabia providing his services by following video trainings. Accordingly, the Player complied with his obligations under the Employment Contract.

120. Further, as to the afore-mentioned proportionality requirement, namely the size of the decrease in the Player’s monthly salary and the economic purpose served thereby. The Club continued paying salary in an amount of SAR 20,000 without reduction, but deducted the remaining amount of the monthly salary by 50%, which effectively resulted in a total reduction amount of EUR 521,115 for the period March – July 2020.

121. Yet, it did so without explaining why this precise percentage was deemed appropriate or necessary at the time of the unilateral contractual variation, during the proceedings before the FIFA DRC, or during the present proceedings before CAS. Indeed, the Panel is unable to discern the economic rationale behind these numbers. A reasonable, equitable and proportionate decrease would need to reflect a balanced allocation of the economic risks of the pandemic between the parties involved. In this way, the Player and the Club would share to some extent its adverse effects. This does not seem to be the case in the present dispute. Taking into account that – as testified by the Club’s Financial Manager – there were 7 foreign players in the squad taking 65% of the total budget during the relevant period, it appears that the Club tried to compensate its loss of revenue directly through salary cuts and to thereby transfer the economic risks of the pandemic almost entirely to its players.

122. Therefore, the Panel concludes that the Club’s decision to reduce the Player’s monthly salary as effectively applied for the period March – July 2020 is excessive and disproportionate as it does not reflect a fair and balanced risk allocation between the parties.

123. As a final point, the Panel finds it important to stress that there also needs to be an element of equal treatment amongst all players.

124. According to the Club’s General Director, 75% of the players accepted the 50% salary reduction by signing an agreement, and 25% accepted the salary reduction by not objecting against it. The Club’s Professional Manager testified that from the total of 30 players (of which 6 or 7 foreign), 23 players (most local, 2 foreign) signed the reduction agreement. The Club maintains that the salary reductions were applied to all its employees and that the Player is the only one claiming his full salaries. Yet, the Club did not present written evidence that players indeed agreed to the reduction applied. Against this background, the Club failed to convince the Panel that the Club followed a consistent and coherent policy of salary reductions to all its players, which leaves open the possibility that the Club’s conduct towards the Player has been grossly discriminatory.

125. In light of the foregoing analysis, and after reviewing carefully the facts of the case, the Panel concludes that the Club’s decision of 17 April 2020 by means of which it purported to unilaterally vary clause 4 of the Employment Contract and to thereby pay the Player reduced monthly salaries in the period from 15 March 2020 “until resuming the sport activity and training” was not in compliance with the requirements set by FIFA COVID-19 Guidelines, as it was in breach of the proportionality requirement and possibly also in breach of the principle of equal

treatment and non-discrimination. Consequently, this decision is devoid of legal effects and it is not binding on the Player.

126. In view of the particular facts of this case, the Panel considers that the Player cannot be subject to any reduction in his salaries.

127. As a result, the Panel confirms that the Player has a legal entitlement to receive his contractually agreed monthly salaries over the period from March - July 2020, in their entirety, in accordance with clause 4 of the Employment Contract without any reduction whatsoever.

128. The remaining elements of the Appealed Decision were not contested by the Club and the Panel sees no reason to deviate therefrom.

129. Consequently, the Panel confirms the Appealed Decision in full.

B. Conclusion

130. Based on the foregoing, the Panel holds that:

i. The Player did not agree to the salary reduction;

ii. The Club was not entitled to unilaterally vary the financial terms of the Employment Contract;

iii. The Appealed Decision is confirmed in full.

131. All other and further motions or prayers for relief are dismissed.