According to the Scotsman, the players’ wages have again been delayed. According to the article “The players were first supposed to have been paid on 16 October, and although some of the younger playing staff have received their wages, senior players are still waiting. They were spoken to by Hearts director Sergejus Fedotovas on Friday, to explain the situation, but no definite date of payment for the outstanding monthly salaries could be given by way of assurance.”
What could a player do in these circumstances to protect his position?
The players are all employed under a contract. As part of that contract, the player has a duty to turn up for work, to use his best endeavours for his employer and otherwise to fulfil the contractual terms. As the contract is a mutual one, the employer also has duties, including that of paying the player his wages.
As a matter of contract law, if a player is not paid his wages when due, what can he do?
Non payment of wages is a fundamental breach of the contract. There can be breaches of contract which are minor and to which the following do not apply, but payment is a fundamental part of the bargain.
If a party, in this case the player, considered that there had been such a fundamental breach of contract, he would be entitled (a) to treat the contract as at an end due to the employer’s breach and (b) proceed with action at a court or tribunal for damages for such breach, including damages for constructive dismissal.
With football players however, there is a further issue to consider. Whilst we talk about players being bought and sold, what are transferred are actually their registrations. Therefore we need to see what football’s own rules say about this. After all, if a player is of the opinion that the employer’s failure to pay has effectively ripped up the contract, he will still want to play somewhere. Whilst his registration is held by the Club, he cannot do so.
How might this play out?
Joe Bloggs of East Kilbride Taxmen FC – His Story
Let’s take a hypothetical situation. Our player is called Joe Bloggs, playing for the East Kilbride Taxmen in the SPL. Joe is playing very well for EKT. He is on the verge of an international call up. He signed a contract two years ago when he was in the reserves, and he doesn’t feel that he is getting what he is due now. His agent, Mr A Shyster (apologies to all agents – remember this is hypothetical) was knocked back by the team’s owner, Bill Moneybags. His agent tells him that he would be a target for top EPL clubs in the next transfer window, and would be made for life, if he was transferred. Mr Moneybags however has pledged to the fans that he will keep the team together, and has told Shyster that he won’t sell Bloggs, even if Barcelona come calling.
However, due to a temporary embarrassment, with funds “resting in the wrong accounts” Bloggs does not get paid on time in October. This is the third time this had happened this year. He is fed up with it, especially as he has been named Sunday Post man of the match in EKT’s last four games.
What can he do?
Shyster talks to his lawyer, A Wiseman. He tells Shyster what I have mentioned above. Shyster decides, having of course received Joe’s instructions, to act.
A letter is sent to Moneybags at EKT advising that, in light of their breach of Joe’s contract, that contract is at an end. Joe has a choice now. He can either indicate that he will pursue EKT for damages for breach of contract, or simply say he is making no such claim, but that he will be asking the SPL to terminate his registration.
At this point, Joe would write to the SPL, copying his letter to EKT, giving 14 days notice of the termination of his registration, as per D6.4. This would be n the basis that EKT’s breach of contract, is termination of the contract within the terms thereof. Mr Moneybags might well object to this, and he has the 14 day period to do so. This can only be on the ground that the contract is not terminated, or that is did not terminate in accordance with the contract terms. I suspect that if EKT tried to say that their own fundamental breach of contract did not allow Joe to terminate his registration, the courts would strike this down as a restraint of trade, akin to the way football teams could retain a player’s registration even after the contract had expired.
The SPL would have two ways of dealing with this, depending on what Joe had done. If he was looking for damages from EKT, then the SPL would operate D6.4 and would determine if the registration should terminate. If Joe is not making a claim against EKT, and EKT are not pursuing Joe, then, under D6.9, the SPL can terminate the registration where satisfied the player’s connection with the Club has come to an end as long as there are no claims outstanding between player and club.
D6.10 makes it clear that, unless terminated in accordance with the earlier rules, the registration continues.
So we have Joe having sent in his letter. EKT try to prevent the termination. The SPL would convene a hearing. In terms of contract law, as long as his action to treat the contract as repudiated by EKT is taken promptly, it would be hard to see a ground for the panel to determine that the contract still existed. In such a case therefore, Joe could see his registration terminated and would then be a free agent, able to sign for whoever wanted to pay him what he was worth.
Under D11, if the contract ends in these circumstances, EKT would not be entitled to compensation from the new team Joe signs for. Of course, for him to be registered with his new team, Joe would need to wait for the next transfer window to open, but he could negotiate his new contract to become effective on 1st January.
On the other hand, John Doe is the old warhorse of the team. He is now 34 and has just over a year of his contract to run. His knees are swollen after every game and training session, and his hope is that he might get a job on the coaching staff when he retires. John could take the same approach as Joe, but clearly that would be an act of folly. After all, it is the choice of the employee as to whether to treat the non-payment of wages as a fundamental breach of contract.
Any team which fails, especially repeatedly, to pay its players is running a risk. The danger is that its stars, especially less highly paid players, might decide to take advantage of the failure to pay and quit. As we have seen many times, the signing on fees for free agents can be enormous, as no transfer fee needs be paid. In our example, Mr Moneybags is left with a team full of players like John Doe. Not just has he lost the talents of Joe Bloggs and other players of that ilk, but he has also lost the transfer income he was banking on to build the giant Jacuzzi in the Board Room. Mr Moneybags would not be happy!
As with rulings such as the Bosman and Webster cases, all it takes is for one courageous player, with a smart agent and lawyer, to call the teams’ bluff. If so, we could see teams crumble very quickly in future.
While I prefaced this piece by referring to Hearts, I am sure that their situation is purely temporary and one with which all of its players is happy. Mr Romanov, I want to make it clear that Mr Moneybags is not you, and EKT has no connection with any football team, living or dead!
In the SPL, registration of players, and particularly termination thereof, is dealt with under the SPL Rules. Section D6 deals with termination of registration. There are various methods of doing so, but for these purposes Sections D6.4, D6.9 and D6.10 are most relevant. They state:
“D6.4 Subject to the terms of this Rule D6.4, where the employment of a Professional Player by the Club to which he is Registered has been terminated in accordance with his Contract of Service the Player may, by giving fourteen clear days written notice to the Secretary, copied to the Club to which he is Registered, terminate his Registration. The Club to which he is Registered may, within fourteen days of receipt of the copy of such notice, notify the Secretary in writing and copied to the Player, that the Club concerned objects to the termination of the Registration of the Player. The only valid reasons for such objection are that the Player’s employment under his Contract of Service shall not have terminated or that termination of the employment by the Player shall not have been in accordance with the terms of the Player’s Contract of Service. In the event of the club validly objecting in accordance with this Rule D6.4 the Board shall determine whether, when and on what terms and conditions, if any, the Registration of the player shall terminate.
D6.9 The Board may terminate the Registration of a Player where, after consulting with the Club and Player concerned, the Board is satisfied that the Player’s association as a Player with the Club concerned has permanently terminated and there are no continuing claims between the Club and Player concerned.
D6.10 The Registration of a Player shall continue unless or until terminated in accordance with these Rules.”
Written by Paul McConville | scotslawthoughts.wordpress.com