Manuel Henrique Tavares Fernandes v. FC Lokomotiv

II. BACKGROUND FACTS

3. Below is a summary of the main relevant facts, as presented in the Parties’ written submissions and evidence adduced in the course of the present proceedings. Additional facts may be set out, where relevant, in connection with the legal discussion. While the Panel has considered all the facts, allegations, legal arguments and evidence submitted by the Parties in the present proceedings it refers in this Award only to the submissions and evidence it considers necessary to explain its reasoning.

A. The Contract

4. On 1 June 2014, the Appellant entered into an employment contract with the Respondent, valid for five years, i.e. from 1 June 2014 until 31 May 2019 (the “Employment Contract”).

5. The relevant terms of Annex No. 1 to the Employment Contract provide as follows:

1.1 During the period of work of the Football player in the Club, the Club is obliged to pay to the Football

player the Remuneration, that shall be paid obligatory and in full amount subject to the condition of the proper performance by the Football player of his obligations under the Contract.

1.2 The Remuneration of the Football player, in accordance with the subparagraph 1.1 of the present Annex, is determined in amount of 383200 (three hundred eight three thousand and two hundred) Euros monthly (before deduction of individual income tax).

1.3 The Club shall pay to the Football player an additional bonus amounting to 2299000 (two million two hundred ninety nine thousand) Euros (before deduction of individual income tax) which is to be paid no later than on 15 July 2014.

1.4 Additional premiums may be paid to the Football player in accordance with the Clubs team bonus system.

1.5 All payments, indicated in the Contract its Annexes, are performed in Russian RUB. In that case, if the due sums are indicated in the foreign currency, the payment is performed in Russian RUB at the rate of the Central Bank of Russia on the day of charge.

1.6 In accordance with the active legislation, the Club deducts the individual income tax from the sums, paid to the Football player. The current individual income tax rate is 13%.

…

2.1.1. The Club is not obliged to provide the apartment for living for the Football player and members of his family (to rent the apartment for the Football player).

2.1.2. Instead of renting an apartment for the Football player the Club shall to pay to the Football player an amount of 5000 (five thousand Euros monthly (before deduction of the individual income tax). The Football player shall rent an apartment on his own.

7. Other than the above, the Employment Contract does not contain a provision regarding the specific payment date of the Appellant’s remuneration. In this regard, the Parties did not further define or specify the term “day of charge”.

8. Throughout the duration of the Employment Contract, it is undisputed that the Appellant’s remuneration was paid by the Respondent in Russian RUB. This said, throughout this period, the Appellant contested the amounts of his salary payments, in particular the exchange rate used by the Respondent for the payment of his salaries.

9. In particular, on 24 July 2015, the Appellant sent a letter to the Respondent requesting the payment of outstanding salaries in the amount of RUB 6’747’918.32 for the period between June 2014 and May 2015, as well as the payment for match bonuses in the total amount of RUB 4’435’000. He also asked the Respondent to provide him with an explanation on the method used for calculation of his salaries in application of the currency rates.

10. Having received no response, on 7 August 2015, the Appellant reiterated the aforesaid requests in a second letter addressed to the Respondent.

11. On 21 August 2015, the Respondent rejected the Appellant’s requests, asserting inter alia that the “Labour Code of Russia stipulates that a date of charge is defined by an employer and established in its bylaws. In this regard, we particularly note that any legal entity may set not a specific date, but a period of time when a salary is to be charged”. Moreover, and in short, the Respondent rejected the Appellant’s claim for additional salary and bonus payments, and suggested that the Appellant re-calculate his demand based on erroneous currency exchange rates.

12. On 4 September 2015, the Appellant responded to the Respondent and disputed its assertions on payments, bonuses, and currency rates. The Appellant again reiterated his request for the payment of outstanding salaries and match bonuses, and requested his payslips for the entire period of employment and all documents setting the dates of accrual of salaries and the team bonus system for seasons 2014-2015 and 2015-2016.

13. The Respondent did not respond to the Appellant’s requests.

B. The Decision of the Dispute Resolution Chamber of FIFA

14. On 30 April 2017, the Appellant lodged a claim before the FIFA’s Dispute Resolution Chamber (“DRC”) against the Respondent for outstanding remuneration, requesting RUB 11,182,918.32 plus 5% interest p.a. as of 25 July 2015, detailed as follows: 1) RUB 6’747’918.32 as outstanding salaries for the period between June 2014 and May 2015; 2) RUB 522’000.00 as part of a bonus for a match allegedly played on 13 March 2015; 3) RUB 3’913’000.00 as part of the bonus for the winning of the Cup of Russia, which the club allegedly partially paid on 28 May 2015.

15. In his claim, the Appellant also requested sporting sanctions to be imposed on the Respondent.

16. The Appellant filed a claim on the basis that he was entitled to salaries in the “total net amount” of RUB 236’982’510.30 for the period between June 2014 and May 2015, alleging that he had only received RUB 230’234’591.98 and that the Respondent did not use the exchange rate of the Central Bank of Russia applicable “on the last day of the month” or, alternatively, “on the day of payment”.

17. On 24 August 2018, the FIFA DRC rendered the following decision (the “DRC Decision):

“The claim of the Claimant, Manuel Henrique Tavares Fernandes, is rejected insofar as it is admissible”.

18. On 16 November 2018, the grounds of the DRC Decision were notified to the Parties.

19. The relevant points of the DRC Decision read as follows:

6. In this context, the Chamber first referred to art. 25 par. 5 of the Regulations, according to which the Dispute Resolution Chamber shall not hear any case subject to the Regulations if more than two years have elapsed since the event giving rise to the dispute. Considering that the claim of the Claimant was lodged in front of FIFA on 30 April 2017 only, the Chamber found that it could not enter into any claim for salaries and bonuses that fell due prior to 30 April 2015.

7. Taking into account the previous consideration, the Chamber preliminarily concluded that the Claimant's request for the salaries and bonuses accrued before the date of 30 April 2015 was barred by the statute of limitations in accordance with art. 25 par. 5 of the Regulations.

8. In continuation, the members of the Chamber took note that, according to the contract, the player's salary was agreed in euros and payable in roubles. Furthermore, the DRC observed that, in his claim, the Claimant argued that the amounts paid by the Respondent in roubles did not cover the amounts contractually agreed in euros. In particular, the player claimed that, pursuant to the applicable exchange rate, the conversion from euros to roubles resulted in outstanding salaries due.

9. Subsequently, the Chamber observed that the Respondent submitted its reply to the claim after notification of the closure of the investigation of the matter at hand. As a result, in line with art. 9 par. 4 of the Procedural Rules as well as the Chamber's constant jurisprudence in this regard, the DRC decided not to take into account the reply of the Respondent and established that, in accordance with art. 9 par. 3 of the Procedural Rules, a decision shall be taken upon the basis of those documents on file that were provided prior to the closure of the investigation-phase, in casu, upon the statements and documents presented by the Claimant.

10. In view of the aforementioned considerations, in respect of the question as to whether or not the amounts paid by the Respondent in RUB corresponded to the amounts contractually agreed in euros, the members of the Chamber firstly referred to art. 12 par. 3 of the Procedural Rules, according to which any party claiming a right on the basis of an alleged fact shall carry the respective burden of proof. The application of the said principle in the present matter led the members of the Dispute Resolution Chamber to conclude that it was up to the Claimant to prove that the amounts paid by the Respondent in roubles did not cover the amounts contractually agreed in euros.

11. Having stated the above, the members of the Chamber concurred that the Claimant did not substantiate his allegations, as it did not present any evidence in respect of the exchange rate which the Respondent allegedly had to apply to the amounts contractually agreed. In particular, the Claimant did not provide the Chamber with any evidence which could corroborate that the exchange rate indicated by the Claimant was, in fact, correct.

12. On account of the aforementioned considerations, the DRC had no other option than to conclude that, since the Claimant had not been able to prove that the amount paid by the Respondent did not correspond to the amount contractually agreed, his claim for outstanding salaries was rejected. In particular, the DRC highlighted that the Claimant failed to provide any official document which would demonstrate that the official exchange rates actually corresponded to the ones he alleged were applicable.

13. In continuation, as to the claim for outstanding bonuses, the Chamber first noted that, pursuant the contract, the payment of bonuses was subject to the club's bonus system. With the above in mind, taking into account the documentation presented by the Claimant in support of his petition, the DRC observed that the Claimant had not submitted any evidence with reference either to the club's bonus system or the

bonuses allegedly agreed. As such, it was not possible for the DRC to ascertain that the player was actually entitled to the requested bonuses.

14. Consequently, the DRC concluded that the Claimant had not fully substantiated his claim for outstanding bonuses with pertinent documentary evidence in accordance with art. 12 par. 3 of the Procedural Rules and, thus, decided to reject also this part of the claim.

15. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claim lodged by the Claimant is rejected.

III. PROCEEDINGS BEFORE THE COURT OF ARBITRATION FOR SPORT

20. On 7 December 2018, the Player filed a Statement of Appeal pursuant to Article R47 et seq. of the Code of Sports-related Arbitration (“Code”) with the Court of Arbitration for Sport (“CAS”) against the Respondent with respect to the DRC Decision. In his Statement of Appeal, the Appellant requested that this procedure be referred to a Sole Arbitrator.

21. Moreover, in his Statement of Appeal, the Appellant requested that the CAS order the Respondent to produce certain documents and to fix his time limit to file the Appeal Brief only upon receipt of such documents, as follows: a) FC Lokomotiv's policy and method of calculation of salaries towards players, applicable during the season 2014-2015; b) a proof that the Appellant was familiarized with the aforementioned policy (if any); c) FC Lokomotiv's policy and method of calculation of its bonuses for the season 2014-2015 (including office-memos (if any) basing on which the amount of the Appellant's bonus for the win of the Cup of Russia was decreased, comparing to his teammates) and the list of all players who received a bonus at the end of the season 2014-2015, including the amounts of respective bonuses; d) a proof that the Appellant was familiarized with the aforementioned policy (if any); e) payslips for the Appellant's salaries for the period from 01 June 2014 to 31 May 2017, with an indication which currency rate was used to calculate the amounts in Russian RUB; f) a proof that the aforementioned payslips were given by FC Lokomotiv to the Appellant, as prescribed by law (if any).

22. Pending the Respondent’s response to this request, the CAS Court Office suspended the Appellant’s time to file his Appeal Brief.

23. On 17 December 2018, the Respondent objected to the Appellant’s production request.

24. On 18 December 2018, the President of the CAS Appeals Arbitration Division rejected the Appellant’s request to suspend his time limit to file the Appeal Brief pending receipt of such requested documents in accordance with Article R32 of the Code. A new deadline of 28 December 2018 for the filing of his Appeal Brief was subsequently set by the CAS Court Office.

25. On 19 December 2018, the Respondent objected to the Appellant’s request to submit this matter to a Sole Arbitrator.

26. On 27 December 2018, the Appellant filed his Appeal Brief pursuant to Article R51 of the Code.

27. On 28 December 2018, the Deputy President of the CAS Appeals Arbitration Division decided to submit this matter to a three-member Panel in consideration of the circumstances of the present case and invited the parties to make their respective arbitrator nominations.

28. On 6 January 2019, the Appellant nominated Mr. João Nogueira da Rocha as arbitrator.

29. On 10 January 2019, the Respondent nominated Mr. Frans de Weger as arbitrator.

30. On 4 February 2019, following an agreed-upon extension of time, the Respondent filed its Answer in accordance with Article R55 of the Code.

31. On 6 February 2019, the CAS Court Office, on behalf of the President of the CAS Appeals Arbitration Division, confirmed the constitution of the Panel as follows:

President: Mr. Alexander Mc Lin, Attorney-at-Law, Geneva, Switzerland

Arbitrators: Mr. João Nogueira da Rocha, Attorney-at-Law, Lisbon, Portugal Mr. Frans de Weger, Attorney-at-Law, Haarlem, the Netherlands

32. On that same date, the CAS Court Office confirmed the appointment of Me. Marianne Saroli, Attorney-at-Law in Montreal, Canada, as ad hoc clerk.

33. On 13 February 2019, following an inquiry from the CAS Court Office, the Respondent informed the CAS Court Office of his preference for an award to be rendered on the sole basis of the Parties’ written submissions. No such response was received from the Appellant.

34. On 28 February 2019, the CAS Court Office advised the Parties that the Panel considered itself sufficiently well-informed with the Parties’ written submissions and therefore decided not to hold a hearing in accordance with Article R57 of the Code.

35. On 6 March 2019, the Appellant signed and returned the Order of Procedure in this appeal on the condition that the Panel rule on his request for production, noting as follows:

• A Request for Evidentiary Measures was included in the Statement of Appeal. On 18 December 2018, the President of the CAS Appeals Arbitration Division rejected his request for suspension of his time limit to file the Appeal Brief until receipt of certain documents requested to be produced by the Club while no decision was rendered on the Request for Evidentiary Measures.

• Only the Bonus Regulations were presented by the Respondent from the list of the evidence requested by the Appellant.

• In its Answer, the Respondent did not contest the facts that other players of the team were rewarded by the bonus of RUB 4’350’00.00 (net of taxes) for the win of the Cup of Russia and that payslips were never provided to the Appellant despite having been requested. Thus, the Respondent tacitly confirmed these facts.

• The Respondent stated in its Answer that it had the right to choose any date of accrual of salaries in accordance with the Russian laws, without substantiating such statement and presenting its method of calculation.

• In its Answer, the Respondent did not contest the BDO auditor’s letter.

36. On 8 March 2019, the Respondent signed and returned the Order of Procedure.

37. On 8 March 2019, the Panel, in response to the Appellant’s inquiry, directed the Respondent to produce all the documents requested by the Appellant within a 10-day deadline, pursuant to Article R44.3 of the Code.

38. On 22 March 2019, the Respondent questioned the Panel’s decision of 8 March 2019 and expressed the following comments:

• The decision not to satisfy the Appellant’s request for evidentiary measures was taken on 18 December 2018 and consequently, the Respondent asks the Panel to clarify the situation and specify if necessary which documents to produce.

• The Appellant should be in possession of the documents he is requesting. The Appellant has the obligation to produce the evidence that will support his claims while his request for production of certain documents does not meet the requirements set out in Article 44.3 of the Code.

• The Appellant breached Article R44.l of the Code when he submitted additional arguments in his letter dated of 6 March 2019.

• The Appellant made false and misleading conclusions based on his own assumptions as the Respondent never confirmed or admitted the facts stipulated by the Appellant in his letter dated 6 March 2016.

39. On 25 March 2019, the CAS Court Office advised the Respondent that the President of the CAS Appeals Arbitration Division only rejected the Appellant's request for a suspension of its time limit to file appeal brief until there was a decision on the Appellant's request for a production of documents, pursuant to Article R32 of the Code. The Respondent was reminded that only the Panel has the power to decide on the Appellant's request for production of documents, pursuant to Article R44.3 of the Code, and that the Panel would address his comments in the final award.

40. On 25 March 2019, the Respondent filed a single document in response to the Appellant’s production request.

41. On 8 April 2019, the Appellant, with the consent of the Panel, commented on the Respondent’s document production as follows:

• The Respondent only filed one document from the list of the documents requested, namely the list of players who received a bonus for the win of the Cup of Russia 2014- 2015 and failed to produce the following documents: a) FC Lokomotiv's policy and method of calculation of salaries towards players, applicable during the season 2014-2015; b) a proof that the Appellant was familiarized with the aforementioned policy (if any); c) a proof that the Appellant was familiarized with the bonuses’ policy (if any); d) payslips for the Appellant's salaries for the period from 01 June 2014 to 31 May 2017, with an indication which currency rate was used to calculate the amounts in Russian RUB; e) a proof that the aforementioned payslips were given by FC Lokomotiv to the Appellant, as prescribed by law (if any).

• The Respondent failed to produce its policy and method of calculation of salaries towards players, applicable in the season 2014-2015 and did not provide an adequate explanation on how it calculated the Appellant’s salaries and which currency rate it applied.

• By failing to provide to produce the payslips, it can be presumed that the Respondent never provided the Appellant with a chance to know what was paid to him and how it was calculated.

• Only one of the papers presented by the Respondent is relevant, namely the Order dated of 28 May 2015. The other papers presented by the Respondent were not only not relevant, but also not requested by the Appellant.

• The Respondent provided an illustrative and self-explanatory list of employees rewarded by bonuses for the win the Cup of Russia. It appears that most players, whether they had played 1 or 5 matches, were rewarded with RUB 300’00.00. However, the Appellant only received RUB 100’000.00, contrary to Articles 22 and 132 of the Labor Code of Russia.

• A decision to reduce bonuses or to deprive a Player of bonuses could not be arbitrary made by the Club, without a reason, expressly stipulated into the contract or internal regulations.

• In comparison to similarly situated players, there is a clear discrimination of the Appellant’s labour rights.

42. On 15 April 2019, the Respondent replied to the Appellant’s comments filed on 9 April 2019 as follows:

• The Appellant breached Article R44.l of the Code when he submitted additional arguments in his letter dated of 6 March 2019.

• Contrary to the Appellant’s assertion, the Respondent produced three documents, namely: an Order dated 28 May 2015, Order dated of 12 March 2015 and Bonus Regulations.

• The Appellant made false and misleading conclusions.

43. On 16 April 2019, the Respondent objected to the Appellant’s comments filed on 9 April 2019 and sought confirmation as to whether they were admitted to the file.

44. On 17 April 2019, the CAS Court Office, on behalf of the Panel, advised the Respondent that the Appellant’s comments filed on 9 April were expressly allowed by the Panel further to unsolicited evidence untimely submitted by the Respondent, without any explanations, which the Respondent had ample opportunity to address earlier in the proceedings. The Appellant’s submission was therefore permitted under the circumstances.

45. This said, the Panel notes that the lone document filed by the Respondent on 25 March 2019 (i.e. the Order dated 12 March 2015) was not one of the documents requested by the Appellant and does not pertain to any requests for relief. Therefore, for completeness and the avoidance of doubt, the Panel does not accept such document on the file.

IV. SUBMISSIONS OF THE PARTIES

46. This section of the award does not contain an exhaustive list of the Parties’ contentions, its aim being to provide a summary of the substance of the Parties’ main arguments. In considering and deciding upon the Parties’ claims in this award, the Panel has accounted for and carefully considered all of the submissions made and evidence adduced by the Parties, including allegations and arguments not mentioned in this section of the award or in the discussion of the claims below.

A. The Position of the Appellant

47. In his Appeal Brief, the Appellant seeks the following relief: 1. To uphold the present appeal against the Decision of the Dispute Resolution Chamber of FIFA dated 24 August 2018; 2. To rule that FC Lokomotiv shall pay to the Appellant the overdue payables in the net amount of 11 097 918 30 Russian RUB from which 6 747 918 30 Russian RUB is the monthly salary, while the rest 4 350 000 Russian RUB are the team bonuses; 3. To rule that FC Lokomotiv shall pay to the Appellant the interest at a rate of 5% per annum, accrued in accordance with Article 236 of the Labour Code of Russia on the amount of 11 097 918,30 Russian RUB as from 25 July 2015; 4. To rule that FC Lokomotiv shall contribute to the legal and other costs incurred by the Appellant in relation to these proceedings, in the amount the CAS finds appropriate; 5. To rule that FC Lokomotiv shall bear the entire costs of this arbitration and reimburse the Appellant the minimum CAS Court Office fee of CHF 1000 as well as any other amounts of advances of costs paid to the CAS.

48. The Panel notes that in his Statement of Appeal as well as in the proceeding before the FIFA DRC, the Appellant sought a slightly higher amount of 4’435’000 RUB as unpaid bonus. The

Panel accepts, in conformity with the principle of non ultra petitum, that the amount of 4’350’000 RUB as claimed in the Appeal Brief and corresponding to the total amount in dispute of 11’097’918.30 RUB as accepted by the parties in the Order of Procedure is the final amount claimed regarding unpaid bonuses for purposes of the instant case.

49. The Appellant’s submissions may be summarized, in essence, as follows:

a) Outstanding salaries

• When signing the Employment Contract (which was drafted by the Respondent), the Appellant was informed by the Respondent that “day of charge” expressly meant (as for monthly payments) “the last day of each respective month” and (as for all other payments) “the day of respective payment”. Respondent later confirmed this information by means of the official letter of its auditor, BDO, as follows: “According to the current law of the Russian Federation, employees' salaries shall be charged on the last day of each month. In the case of termination of employment contract, any payment due to employee (including the compensation for the termination of employment agreement) shall be charged on the date of termination of employment agreement, i.e. on the final working day of the employee. Date of charge (accrual) may differ from the date of payment”. Accordingly, it is clear that the Respondent understood that the monthly payments had to be accrued on the last day of each respective month, irrespectively of the dates when they were effectively paid, and, therefore, the official currency rates set by the Central Bank of Russia for the last day of each respective month had to apply.

• On 16 July 2014, the Appellant received payment in the amount of RUB 92’958’841.60, which was equal to EUR 2’000’130.00 at the applicable exchange rate (RUB 46.47 per 1 Euro), set by the Central Bank of Russia for this date. Hence, the Respondent duly executed its obligations under Article 1.3 Annex 1 to the Employment Contract.

• The Respondent, however, never made its monthly payment in one instalment, instead varying the payment over 1 to 3 instalments. For instance, the Appellant received 1 payment in June 2014, 2 payments in July-November 2014, 3 payments in December 2014, 2 payments in January 2015, 1 payment in February 2015, 3 payments in March 2015, 2 payments in April and May 2015.

• During the first year of the employment (period from 1 June 2014 to 31 May 2015), the Respondent made payments to the Appellant without specifications. It was, therefore, impossible for the Appellant to know for which respective month a payment was made.

• According to Article 136 of the Labor Code of Russia, an employer must inform each employee, in writing, the salary amount accrued in that certain month, the deductions that were made to the salary amount, and the total amount that is due and owing. The Respondent, however, did not do this and the Appellant could not verify the accuracy of the Respondent’s salary calculations.

• During the first contractual year, all monthly payments had to be accrued on the last day of each respective month, irrespectively of the dates of effective payments. The Appellant was entitled to receive RUB 236’982’510.28 by 31 May 2015, calculated as follows:

Russian Central Due amount in Due amount in RUB Bank’s official EUR exchange rate on the last day of the month June 45.8251 337’734 15’476’694.32 Jul 47.8958 337’734 16’176’040.12 August 48.6315 337’734 16’424’511.02 September 49.9540 337’734 16’871’164.24 October 54.6378 337’734 18’453’042.75 November 61.4108 337’734 20’740’515.13 December 68.3427 337’734 23’081’653.44 January 78.1105 337’734 26’380’571.61 February 68.6857 337’734 23’197’496.20 March 63.3695 337’734 21’402’034.71 April 56.8060 337’734 19’185’317.60 May 58.0145 337’734 19’593’469.14 TOTAL: 236 982 510.28

- However, as the following chart sets out, the Appellant only received RUB 230’234’591.98 by 31 May 2015.

Date of Received amount payment in RUB June 27.06.2014 885’600 July 16.07.2014 14’574’383.82 29.07.2014 898’000 August 15.08.2014 15’173’939.56 28.08.2014 913’200.00 September 15.09.2014 15’326’781.30 26.09.2014 945’000 October 14.10.2014 15’896’965.33 28.10.2014 1’013’700 November 14.11.2014 16’767’877.58 27.11.2014 1’122’500.00 December 01.12.2014 19’614’814.56 15.12.2014 1’287’500

29.12.2014 20’155’033.11

January 16.01.2015 1’494’000 30.01.2015 24’262’573.78 February 13.02.2015 1’432’000 March 11.03.2015 20’638’858.85 16.03.2015 1’238’180 27.03.2015 19’728’718.02 April 15.04.2015 1’064’000.00 28.04.2015 17’301’043.23 May 15.05.2015 1’067’000.00 27.05.2015 17’432’922.84 TOTAL: 230’234’591,98

- The difference of these two amounts (RUB 236’982’510.28 – RUB 230’234’591.98) amounts to RUB 6’747’918,30 net of taxes, which is what the Respondent owed the Appellant at end May 2015. It is can also be represented as follows:

Due amount Date of Received Amount of debt payment amount in (on the last day RUB of the month) June 15’476’694.32 27.06.2014 885’600 14’591’094.32 July 16’176’040.12 16.07.2014 14’574’383.82 15’294’750.62 29.07.2014 898 000 August 16’424’511.02 15.08.2014 15’173’939.56 15’632’122.08 28.08.2014 913’200 September 16’871’164.24 15.09.2014 15’326’781.30 16’231’505.02 26.09.2014 945’000 October 18’453’042.75 14.10.2014 15’896’965.33 17’773’882.44 28.10.2014 1’013’700. November 20’740’515.13 14.11.2014 16’767’877.58 20’624’019.99 27.11.2014 1’122’500 December 23’081’653.44 01.12.2014 19’614’814.56 2’648’325.76 15.12.2014 1’287’500 29.12.2014 20’155’033.11 January 26’380’571.61 16.01.2015 1’494’000 3’272’323.59 30.01.2015 24’262’573.78 February 23’197’496.20 13.02.2015 1’432’000 25’037’819.79

March 21’402’034.71 11.03.2015 20’638’858.85 4’834’097.63 16.03.2015 1’238’180 27.03.2015 19’728‘718.02 April 19’185’317.60 15.04.2015 1’064’000 5’654’372.00 28.04.2015 17’301’043.23 May 19’593’469.14 15.05.2015 1’067’000 6’747’918.30 27.05.2015 17’432’922.84

• While the Respondent fully paid the Appellant’s salaries until April 2015, it failed to pay RUB 6’747’918.30 due and owing for May 2018. By June 2015, the Respondent made partial payments corresponding to the accrued amounts but the balance amount of RUB 6’747’918.30 remains unpaid to this day.

• This outstanding amount arose due to the misapplication of the relevant currency exchange rates by the Respondent during the first year of the Employment Contract. In a letter dated 21 August 2015, the Respondent indicated that it had discretion to choose which date to accrue the monthly salaries and, respectively, which currency rate to apply. In this respect, however, the Respondent failed to provide the Appellant with any document setting the dates of accrual of salaries or with a legal ground enabling the Respondent to choose any date for accrual.

• In the Appealed Decision, the FIFA DRC unreasonably concluded that the claim relating to outstanding salaries “accrued before the date of 30 April 2015” were time-barred. The salaries that were accrued before the date of 30 April 2015 were paid. The only outstanding amount corresponded to the salary of May 2015, which accrued on 31 of May 2015, in keeping with Article 87 of the Swiss Code of Obligations (“SCO”). Since the claim before the FIFA DRC was filed on 30 April 2017, it was not time-barred.

b) Unpaid bonus and discrimination of the labour rights

• During the Respondent’s licensing procedure, the Appellant was requested to sign a declaration confirming that the Respondent duly executed its pecuniary obligations towards him. The Appellant signed a declaration in protest highlighting that the Respondent paid his salaries using a wrong exchange rate but the Respondent refused to accept the Appellant’s assertions concerning this exchange rate issue.

• In response, the Respondent started to put pressure on the Appellant and deprived him of the team bonus for the win of the Cup of Russia in the season 2014-2015. While all his teammates were rewarded by bonuses amounting of RUB 4’350’000 net of taxes, the Appellant (who was one of the only two players who played in all five matches of the Cup of Russia and in four of which he was the first-eleven player) did not get his bonus payment.

• The Respondent’s attitude towards the Appellant was driven by Mrs. Olga Smorodykaya, the former President of the Respondent, who was at odds with the Appellant. Nevertheless, further to well-established CAS jurisprudence, the

Respondent’s refusal to include the Appellant into the list of workers who had to be rewarded with bonuses, without a valid reason, constitutes a form of discrimination under Russian law. Such assertion is support by Articles 3, 22, and 132 of the Labour Code of Russia which state respectively as follows: Nobody can be limited in labor rights and freedoms or to get any advantages depending on a gender, race, skin color, nationality, language, origin, property, marital, social and official capacity, age, residence, relation to religion, beliefs, accessory or not belonging to public associations or any social groups and also from other circumstances which are not connected with business qualities of the worker; The employer is obliged: … to provide workers equal payment for work of equal value; Any discrimination at establishment and change of terms of payment for work is forbidden. - Consequently, the Respondent owes the Appellant the bonus for the win of the Cup of Russia (season 2014-2015), in the net sum of RUB 4’350’000 (as paid out to other qualified teammates).

c) Default interest

• Article 236 of the Labour Code of Russia provides as follows: “In the case of violation by the employer of time limits for payment of the salary, leave allowance, payments at dismissal and (or) other payments which are due to the worker, the employer is obliged to pay them with payment of the default interest (monetary compensation) at a rate of not less than 1/150 of the key interest rate of the Central bank of the Russian Federation operating at this time, from the sums which are not paid in time for each day of the delay, that shall accrue as from the next day after the established period of payment till the day of effective payment, inclusively. In the case of an incomplete payment at the scheduled time of the salary and (or) other payments which are due to the worker, the amount of interest (monetary compensation) shall be calculated from the sums which are actually not paid in time”.

• The key interest rate, set forth by the Central Bank of Russia, is 7.75 % per annum. However, as he only requested the rate of 5% p.a. to be applied in his claim during his underlying procedure with the FIFA DRC, he is limited in this procedure in his request for the same rate (i.e. 5% p.a.). Such amount should be awarded by this Panel accordingly.

B. The Position of the Respondent

50. In its Answer, the Respondent requests this Panel: 1. To dismiss the appeal against the Decision of the FIFA Dispute Resolution Chamber dated 24 August 2018; 2. To uphold the Decision of the FIFA Dispute Resolution Chamber dated 24 August 2018; 3. To order the Appellant to participate in legal and other expenses of the Respondent related with the present proceedings in the amount the CAS considers appropriate; 4. To order the Appellant to bear the expenses related with the costs of the present CAS arbitration.

51. The submissions of the Respondent, as contained in its written submissions, are summarized, in essence, as follows:

a) Recalculation of the salaries at the rate of the Central Bank of Russia

• The request to recalculate the salaries at the rate of the Central Bank of Russia on the last day of each respective month or alternatively, on the day of payment, is groundless. Pursuant to the Employment Contract, all the payments indicated therein shall be performed in Russian RUB at the rate of the Central Bank of Russia on the day of charge and not on the day of settlement (payment).

• In accordance with the existing legislation of the Russian Federation, the day of charge of salaries may not coincide with the day of settlement (payment). Taking into consideration the fact that the Labour Code of Russia stipulates that the day of charge is determined by the employer and shall be indicated in the employer's local statutory acts, the Respondent emphasizes that the organization can determine a period (or range of possible dates) when the salaries are to be charged instead of a specific date of charge.

b) The Appellant’s claim is time-barred

• In accordance with Article 25 par. 5 of the FIFA Regulations on the Status and Transfer of Players (“FIFA Regulations”), if more than two years have elapsed since the event giving rise to the dispute, such dispute shall not be heard.

• The event giving rise to the dispute is the alleged non-payment of salaries in full as well as non-payment of bonuses for Appellant's participation in the match against FC Rostov in 2014/2015 sports season during the period from 1 June 2014 until 30 April 2015.

• The Appellant’s claim is time-barred and therefore, he is precluded from obtaining payments for the salaries and bonuses accrued for the period from 1 June 2014 until 30 April 2015 in full.

• Moreover, the Appellant’s reference to Article 87 of the SCO is inadmissible since this legal provision governs situations when the debtor acknowledges the existence of a debt. Here, the Respondent always disputed the debt in its correspondence with the Appellant.

• In response, the Respondent refers to Articles 86.1 and 87.1 of the SCO: Article 86.1 “A debtor with several debts to the same creditor is entitled to state at the time of payment which debt he means to redeem. 2 In the absence of any statement from the debtor, the payment will be allocated to the debt indicated by the creditor in his receipt, unless the debtor objects immediately”. Article 87.1 “Where no valid debt redemption statement has been made and the receipt does not indicate how the payment has been allocated, it is allocated to whichever debt is due or, if several are due, to the debt that

first gave rise to enforcement proceedings against the debtor or, in the absence of such proceedings, to the debt that fell due first. 2 Where several debts fell due at the same time, the payment is offset against them proportionately. 3 If none of the debts is yet due, the payment is allocated to the one offering the least security for the creditor”. In accordance with the foregoing, the limitation period was never interrupted as the Respondent never acknowledged the claim and never made corresponding payments.

c) Bonus Payment

• The Appellant is wrong to assert that he was deprived of team bonus while his teammates received bonus amounting to RUB 4,350,000.

• In reality, the Appellant received team bonuses during the entire season, including bonuses for both participation in the match with FC Rostov (charged on 12 March 2015) and for the win in the Cup of Russia in the season 2014/2015 (charged on 28 May 2015).

• Bonus payments are discretionary taking into consideration such criteria as personal contribution of the employee, each rewarded employee having committed or not a disciplinary offence, etc., and the maximum amount of bonuses is not obligatory for payment. As a result, the Appellant does not have an unconditional right to receive it.

• More specifically, the Respondent relies on the following provisions of the Regulations: 2.4. The rewarding is performed by the President of the Club upon the listing made by Assistant to President — Director of the Lokomotiv football team based on individual labour estimations of each employee and his personal contribution to fulfillment of objectives and contractual obligations drawn up as the order of the President of the Club. 2.5. The rewarding of the employees who belong to the category “other employees” determined by the present Regulations is performed upon the decision of the President of the Club and in the amount determined by the President of the Club drawn up as the order of the President of the Club. 2.6. Articles 3 and 4 of the present Regulations determine the maximum amount of rewards that may be paid to different categories of the employees determined by the present Regulations. The maximum amount of the rewards determined by the present Regulations shall not be essentially charged. The amount of the rewards for each concrete match is determined by the decision of the President of the Club and depends on:

• personal contribution of each rewarded employee towards the result achieved by the team in each concrete match;

• each rewarded employee having committed or not a disciplinary offence;

• other criteria.

d) Discrimination of Labour Rights

- The Appellant’s reliance on testimony of former employees (players) of the Respondent to justify his claim for discrimination is extremely subjective and inadmissible in this

procedure. He has put forth no credible or conclusive evidence to support his claim and, therefore, it should be rejected accordingly.