Editor’s Note: Saverio Spera is an Italian lawyer and LL.M. graduate in International Business Law at King’s College London. He is currently an intern at the ASSER International Sports Law Centre. 

This blog is a follow up to my previous contribution on the validity of Unilateral Extension Options (hereafter UEOs) under national and European law. It focuses on the different approaches taken to UEOs by the FIFA Dispute Resolution Chamber (DRC) and the Court of arbitration for sport (CAS). While in general the DRC has adopted a strict approach towards their validity, the CAS has followed a more liberal trend. Nonetheless, the two judicial bodies share a common conclusion: UEOs are not necessarily invalid. In this second blog I will provide an overview of the similarities and differences of the two judicial bodies in tackling UEOs.

The emergence and function of the Portmann criteria

Since their first appearance in a case widely known as the South American Bosman for the impact it had on the whole system of contracts established by the Uruguayan Football Association, the so-called ‘Portmann’ criteria are often referred to in decisions on the validity of UEOs.^[1] In short, these criteria provide that:

1. the potential maximum duration of the employment relationship must not be excessive;
2. the option has to be exercised within an acceptable deadline before the expiry of the current contract;
3. the original contract has to define the salary raise triggered by the extension;
4. the content of the contract must not result in putting one party at the mercy of the other, and;
5. the option has to be clearly emphasized in the original contract so that the player can have full consciousness of it at the moment of signing.^[2]

These five requirements, proposed by Prof Wolfgang Portmann, were meant to represent the standard UEOs had to meet in order to be considered valid and biding upon the players. More precisely, in order not to constitute an excessive self-commitment that would result in a violation of Swiss ordre public.^[3] They emerged in the course of the South American Bosman as Prof. Portmann’s report was presented by Atlético Peñarol in the (unsuccessful) attempt to uphold the validity of the unilateral option the club had used in its employment contracts. From that moment on, the Portmann criteria became a recurrent theme in decisions by the DRC and the CAS. However, these criteria have been used over the years in a rather incoherent fashion and their importance in the assessment of UEOs is not unequivocal.

Thereafter, in its first decision, the DRC used the criteria to assess the validity of an UEO.^[4] But then it drastically drifted away from them. Actually, in the ensuing decisions the DRC did not refer to the five conditions at all. In some instances it limited itself to recall its established jurisprudence finding the validity of UEOs disputable since they give the stronger party in the employment relationship the power to unilaterally extend or terminate the contract.^[5] In another occasion, the DRC expressly dismissed the binding effect of the Portmann report, underlining that it only constitutes a non-binding recommendation.^[6]

Furthermore, interestingly, in the appeal proceedings of the Atlético Peñarol case the CAS did not mention the Portmann report in its evaluation of the UEO. The Panel only referred to it in the part of the award that assessed the question of the applicable law and noted that Prof Portmann’s starting point was radically different from that of the Panel, as he deemed Uruguayan law applicable to the dispute, while the Panel applied Swiss law/the RSTP.^[7] Having said that, the CAS also seems to have departed from its initial approach, but in a rather different way than the DRC. In an early award of 2007, the CAS refused to give too much weight to the Portmann report and focused its reasoning on other circumstances.^[8] Yet, the ensuing awards did not follow suit on this approach. In its more recent awards, the CAS held that the criteria constitute soft guidelines and often de facto relied on them to reach its conclusion on the validity of an option.^[9] In one occasion, the CAS even added to the list of requirements two criteria, “emanating from recent developments in the FIFA DRC and CAS jurisprudence”, namely (i) the proportionality between the extension and the main contract and (ii) the desirable limitation of the number of extensions to one.^[10]

Regarding the relevance of the Portmann criteria, it seems that the only shared trait between the DRC and the CAS is that both have drifted away from their approach. Though, in quite opposite ways. 

Increase in salary as a sine qua non condition for the validity of UEOs

The question of the increase of the player’s salary is considered central, by both the DRC and the CAS, in deciding the validity of UEOs.

In fact, an improvement of the player’s salary is considered by the DRC as a possible ‘validating’ circumstance since the first published decision on the issue.^[11] The FIFA Chamber placed particular emphasis on the necessity to offset the unequal bargaining power that UEOs give to football clubs. To do that, a significant economic gain for the player must be envisaged in the contract as a result of the extension. In the view of the DRC, this is a necessary but sometimes not sufficient condition for the validity of a UEO, since the specification of the financial terms of the renewal in advance “necessarily cannot take into account, neither by the player nor the club, the possible enhancement of the player’s value, and hence earning power, over a two year period”.^[12]

In its awards on the matter, the CAS contends that the player must derive a clear economic advantage from the exercise of the option.^[13] Thus, the increase in salary is the only requirement that is fully embraced by both the DRC and the CAS. It is interesting to note, however, that in only one occasion did the CAS explicitly mentioned that “[e]ven if the financial terms had to be specified in advance, they necessarily take no account of the possible enhancement of a players value – and hence earning power – over a five year period e.g.: if he becomes an international player during that time”.^[14] It is also worth noting that, at least in one award, the CAS concluded that an increase in salary has to be evaluated only in relation to the previous economic conditions of the player’s contract and not in relation to the salary he could earn somewhere else.^[15]

In light of the above, it is safe to conclude that an UEO coming with a substantial increase in salary for the player has good chances to be deemed valid by the DRC and the CAS. To this end, a few additional observations are relevant. Firstly, how much is enough? Unfortunately, no clear guidelines can be derived from the case law. Secondly, it is practically impossible to predict the increase in value of a football player over a long-term period. Consequently, what can be considered a reasonable increase in salary at the signing of the contract might be deemed insufficient a few years later. Lastly, and probably most importantly, this approach might overlook the fact that an increase in salary is not always the only element a footballer takes into account in his career, as sometimes more personal considerations might push a player to move to a different club in another country. For instance family reasons might play a significant role in such a decision. Furthermore, football players might often consider more convenient for the development of their careers to give up on an increase in salary in order to have the chance to move to a club with more playing opportunities. An increase in salary, even substantial, should not be the altar on which a footballer’s fundamental freedom of movement and, ultimately, of choice is sacrificed.

The player’s behaviour

The player’s stance has often been evaluated by the DRC in particular as a concurrent element in determining the validity of an UEO. The main argument is that a certain behaviour of the player, such as keeping training and playing official matches with the club, implies a tacit acceptance of the extension. Once again, the DRC and the CAS are not entirely on the same line. The DRC jurisprudence gives more weight to this aspect, while the CAS has mentioned that particular attention has to be paid to “the player’s conduct during the period leading to the negotiation of the alleged extension clause” only in one single case.^[16]

With regards to the circumstance that the player has played in official matches as a consequence of the extension, the DRC showed a swinging trend. In one instance, it deemed it not relevant.^[17] Yet, in a subsequent decision (the only one by the DRC upholding the validity of an UEO to date), the fact that the player had kept taking part in training sessions and playing official matches for the club after the extension had quite a different impact on the reasoning of the Chamber.^[18] More recently, the DRC stated that the fact that the player trained with the club for a month after the alleged renewal does not imply his tacit acceptance of the unilateral extension.^[19]

The applicable law

As seen in the first part of this blog, each national jurisdiction interprets the validity of UEOs differently. Consequently, the choice of applicable law can play a major role in the outcome of a case, although the issue arises mainly when the dispute is brought before the CAS. The matter is complicated by the fact that CAS panels have a certain degree of discretion in deciding the law applicable to a dispute, and by the circumstance that even when they apply the same law they might reach different conclusions. With regard to the latter point, let us take into consideration two cases in which the CAS has established Greek law as the applicable law. In one occasion the Panel deemed “appropriate to mitigate the letter of Greek law by the spirit of general principles”, as its content concerning UEOs was considered inconsistent with “general principles of labour law”^[20] and consequently dismissed the appeal of the club. In another one, instead, the Panel concluded that the dispute had to be decided according to FIFA Regulations and Swiss law on a subsidiary basis, “with the important exception of any issues related to the Contract […] which shall be decided in accordance with Greek law”.^[21] Therefore, given that in Greece unilateral options allowing clubs to automatically extend employment contracts are legal, the Panel upheld the validity of the clause.^[22]

A radically different approach was taken by the CAS in the Atlético Peñarol case discussed above. In the absence of an express choice of law of the parties, the Panel deemed the FIFA Regulations and, subsidiarily, Swiss Law applicable. It is worth recalling the reasoning of the Panel, as it could pave the way to a reasonable solution for the UEOs issue. The arbitrators noted that the application of art. 187 of the Swiss LDIP gives wide freedom of choice to the parties, who can even require the arbitrators to decide ex aequo et bono, i.e. without any reference to specific State laws. This means that art. 187 LDIP allows, a fortiori, to refer to rules that transcend the particular State laws, such as sports regulations. The Panel stressed that sport is a phenomenon that naturally crosses borders, and thus it is necessary to ensure uniform legal standards. Only if the same terms and conditions apply to everyone who participates in organised sport, is the integrity and equal opportunity of sporting competition guaranteed. In practice, the FIFA Statutes and Regulations provide such uniform rules. Additionally, the arbitrators underlined that the application of Uruguayan law would lead to a result incompatible with the minimum standards of protection of employees provided by Swiss labour law. Hence, the CAS concluded that the Uruguayan system of UEOs is not compatible with the FIFA Regulations. Furthermore, the Panel noted that these options effectively bypass the basic principles of the FIFA regulations, which “very particularly protect the interests of training clubs through training compensation and the solidarity contribution […] It is not possible that this protection of the contents of a contract between clubs and players can be bypassed in order to serve only the interests of one party, in this case the club, which does not itself have to make a commitment. So the Panel considers that the unilateral contract renewal system is not compatible, in its very principle, with the legal framework which the new FIFA rules were designed to introduce”.^[23] In other words, the Uruguayan system seemed to reintroduce, through the backdoor, the system that was abolished with the reforms of the FIFA Regulations 1997, 2001 and 2005.^[24]In such a system the player is bound to a contract negotiated at a moment of his career when he did not have a strong bargaining power. Which is to say, the player is left at the mercy of the club. The arbitrators stressed that only the most talented players can escape this mechanism, when the club receives an important transfer offer for their services.^[25]In that occasion, the player will hardly refuse the transfer knowing that, doing otherwise, he will be bound to the club because of the UEO in his contract.

Conclusions: The way forward

We have seen in part 1 of this blog that we lack a coherent regulatory framework for UEOs at the national level. This second part has also shown that things are not much clearer at the DRC and the CAS, as the two bodies, while agreeing on the existence of certain criteria, take different approaches on the assessment of each of them (except for the increase in salary). Furthermore, the outcome of a case can be heavily dependent on the applicable law. Consequently, the future validity of UEOs is uncertain, given that no uniformity can be found in the CAS jurisprudence.

The uncertainties related to the applicable law issue are manifold. Upholding the validity of national law, although granting some advantages in terms of foreseeability, presents two main drawbacks. First of all for the clubs which draft the contracts and cannot predict to what extent this law will be deemed applicable by the CAS and, consequently, are unable to draft the contract with all the necessary information desirable in respect to UEO clauses.^[26]Secondly, and most importantly, this approach overlooks the fact that football is a global phenomenon, and the transfer market a transnational one, which requires uniform rules at the international level.

The conclusion reached by the Panel in the Atlético Peñarol case is a fair starting point in the quest for more certainty in the matter. The undisputable merit of that award was to clearly highlight (i) the unequal nature of a clause that is accepted by the player at the early stages of his career and (ii) the necessity to have a body of regulations that can be understood and predicted by the entire international football family.[27] Let us conclude, therefore, that only the universal application of a set of regulations, such as the FIFA RSTP, would ensure legal rationality, predictability and, significantly, “the equality of treatment between all the addressees of such regulations, independently of the countries from which they are”.^[28] A fortiori, when at stake is the fundamental freedom of movement and choice of footballers, the need to rely on a uniform body of principles and rules, a lex sportiva, universally applicable without discrimination becomes crucial.

However, applying the FIFA Regulations in a standardised way still leaves a problem unsolved. This body of rules is in fact silent on the very issue of UEOs. FIFA could tackle the issue in a variety of ways, for instance by codifying in the RSTP a revisited version of the Portmann criteria. Suggesting precise reforms to FIFA goes beyond the purpose of this blog, but one thing is sure: in the face of the extreme uncertainty that surrounds the validity of these clauses, having one single body of rules expressly targeting the issue and universally applicable would be of great help to all the parties involved.

[1] The case concerned the contracts of two Uruguayan players, Carlos Heber Bueno Suárez and Christian Gabriel Rodríguez Barotti with the Uruguayan football club Atlético Peñarol. Pursuant to their contracts, the professional services of Bueno and Rodríguez could be extended unilaterally by the club for two years, provided that their salary would increase in accordance with the National Consumer Price Index. At the end of the season, and after being suspended and deprived of the possibility of playing for four months, the players signed for the French club Paris Saint Germain, and refused the club’s unilateral extension. See TAS 2005/A/983 & 984, Club Atlético Peñarol v. Carlos Heber Buen Suárez, Christian Gabriel Rodríguez Barotti & Paris Saint Germain, award of 12 July 2006. In fact, the framework has slightly changed over the last few years in South America. In Argentina, for instance, the 2009 Collective Bargaining Agreement (CBA) n. 557/09, signed by the Association de Futbol Argentino (AFA) and the Union of Amateur and Professional Football Player provides the current guidelines. In this context, contracts of athletes who have reached the age of 21 can be extended once for one year only, provided that a salary increase of 20% is guaranteed as a consequence of the extension. Extension options for players older than 21 shall be considered null and void, even in the circumstance that AFA has registered the contract, and consequently the player is to be declared a free agent and thus free to sign a contract with another club (see Colucci, Hendricks, Regulating Employment Relationships in Professional Football, A Comparative Analysis, European Sports Law and Policy Bulletin 1/2014, 26). See also Juan de Dios Crespo Pérez’s commentary of the case in A. Wild (ed.) CAS and Football: Landmark Cases (2011), 118. 

[2] F. de Weger, The Jurisprudence of the FIFA Dispute Resolution Chamber, 169.

[3] Prof Portmann considered South American law the law applicable to the substance of the matter. Nevertheless, according to the author, in order to be considered valid, the option not only had to be consistent with local employment law, Collective Bargaining Agreements and regulations of the relevant national association, but it also had to respect mandatory rules of Swiss law and Swiss ordre public. Although he considered the principle of parity of termination rights not part of ordre public per se (and, therefore, the circumvention of that right that these clauses entail not problematic in itself), he stressed that an excessive self-commitment of one of the parties to a contract could indeed result in an infringement of Swiss and international ordre public.

[4] In the unpublished decision 12 January 2007 (see F. de Weger, The Jurisprudence of the FIFA Dispute Resolution Chamber, 169), the DRC made reference to the five elements of the Portmann report to conclude that the option was not valid because, among other considerations, the notice period was too short.

[5] See decision 30 November 2007 n. 117707 and decision 7 May 2008 n. 58860.

[6] See decision18 March 2010 n. 310607, where the DRC interestingly pointed out that the inequality derives from the fact that the player, given the circumstances of contractual inferiority existing at the time he signs his first contract, either accepts the contract with the UEO or gives up on playing football with that team.

[7] TAS 2005/A/983 & 984, Club Atlético Peñarol v. Carlos Heber Buen Suárez, Christian Gabriel Rodríguez Barotti & Paris Saint Germain, award of 12 July 2006, para. 66.

[8] CAS 2006/A/1157, Club Atlético Boca Juniors v. Genoa Cricket and Football Club S.p.A., Award of 31 January 2007, para. 16. The Panel had “great difficulty in following Dr Portmann’s reasoning, and in accepting the validity and enforceability of a unilateral option”. The arbitrators deemed more important, instead, to put emphasis on the general assumption that a person, and a fortiori a minor who had just moved with his family to another country, cannot be required to perform a contract for personal services against his or her will.

[9] The CAS held recently that “these criteria may be taken into consideration and are important, but […] they are not absolute rules, the failure of which would determine the absolute invalidity of the option clause”, in CAS 2014/A/3852, Ascoli Calcio 1898 S.p.A. v. Papa Waigo N’diaye & Al Wahda Sprts and Cultural Club, award of 11 January 2016, para. 86.

[10] More precisely, a Panel held “the need to not accord too much weight and value to the Portmann criteria at the expense of the very important specifics and circumstances behind each individual dispute” CAS 2013/A/3260, Grêmio Foot-ball Porto Alegrense v. Maximiliano Gastón López, Award of 4 March 2014, para. 76, see also para. 68-69.

[11] In Decision 22 July 2004, the DRC noted that because the player’s economic conditions remained substantially unaltered in the renewal, the option was invalid.

[12] See Decision 23 March 2006, para 14. In this case, the DRC deemed that a monthly increase of less than € 1.000 of the player’s salary could not be seen as a significant economic gain for the player.

[13] See CAS 2004/A/678, Apollon Kalamarias F.C. v. Oliveira Morais, award of 20 May 2005, para. 21 and TAS 2005/A/983 & 984, Club Atlético Peñarol v. Carlos Heber Buen Suárez, Christian Gabriel Rodríguez Barotti & Paris Saint Germain, award of 12 July 2006, para. 93. See also CAS 2005/A/973, Panathinaikos Football Club v. Sotirios Kyrgiakos, Award of 10 October 2006 and CAS 2013/A/3260, Grêmio Foot-ball Porto Alegrense v. Maximiliano Gastón López, Award of 4 March 2014, para. 77.

[14] CAS 2004/A/678, Apollon Kalamarias F.C. v. Oliveira Morais, award of 20 May 2005, para 21.

[15] See CAS 2005/A/973, Panathinaikos Football Club v. Sotirios Kyrgiakos, Award of 10 October 2006, para. 23. In which the Panel considered inappropriate to compare between the salary of the extended contract from the Greek club and the salary the footballer would have received at a club in the Scottish league (the Rangers FC) since “it is well known that football clubs operating in richer markets are able to offer a higher income to players”.

[16] CAS 2013/A/3260, Grêmio Foot-ball Porto Alegrense v. Maximiliano Gastón López, Award of 4 March 2014, para. 70.

[17] See Decision 13 May 2005. Here the DRC also pointed out the non-decisiveness of the acceptance by the player of a payment of €1,950 after the extension as a result of the new contract.

[18] See Decision 21 February 2006, in which the DRC noted that: (i) the player had waited almost five months after the beginning of the extension to bring the case before the FIFA.

[19] See Decision 31 July 2013.

[20] CAS 2004/A/678, Apollon Kalamarias F.C. v. Oliveira Morais, award of 20 May 2005, para 24. The Panel dismissed the appeal of the club even though its contract with the player seemed to be drafted in conformity with Greek Sports Law, which – pursuant to Law 2725/99 – allows for the unilateral renewal of the contract provided that (i) the overall duration of the contract, including the extensions, does not exceed five years and that (ii) the financial terms are agreed at the signing of the initial contract.

[21] CAS 2005/A/973, Panathinaikos Football Club v. Sotirios Kyrgiakos, Award of 10 October 2006, para.10.

[22] The Panel, which considered “inappropriate to apply substantive Swiss law to the contract as it has no connection whatsoever with Switzerland (para. 8), made reference to the same Law 2725/99.

[23] TAS 2005/A/983 & 984, Club Atlético Peñarol v. Carlos Heber Buen Suárez, Christian Gabriel Rodríguez Barotti & Paris Saint Germain, award of 12 July 2006, paras. 81-83 (the translation is of the author).

[24] Ibid., para. 80.

[25] Ibid., para. 79.

[26] Ibid.

[27] J-S Leuba, R Fox, J de Dios Crespo Pérez, G L Acosta Perez and F m de Weger, ‘Contractual Stability: Unilateral Options’, in A. Wild (ed.) CAS and Football: Landmark Cases (2011), 119.

[28] Ibid.

Editor’s note: Kester Mekenkamp is an LL.M. student in European Law at Leiden University and an intern at the ASSER International Sports Law Centre.

On 17 February 2016, the Landesarbeitsgericht Rheinland-Pfalz delivered its highly anticipated decision in the appeal proceedings between German goalkeeper Heinz Müller and his former employer, German Bundesliga club Mainz 05.[1] The main legal debate revolved around the question (in general terms) whether the use of a fixed term contract in professional football is compatible with German and EU law. 

In first instance (see our earlier blog posts, here and here), the Arbeitsgericht Mainz had ruled that the ‘objective reasons’ provided in Section 14 (1) of the German Part-time and Fixed-term Employment Act (Gesetz über Teilzeitarbeit und befristete Arbeitsverträge, “TzBfG”), the national law implementing EU Directive 1999/70/EC on fixed-term work, were not applicable to the contract between Müller and Mainz 05 and therefore could not justify the definite nature of that contract.[2] In its assessment the court devoted special attention to the objective reason relating to the nature of the work, declining justifications based thereupon.[3] Tension rose and the verdict was soon labelled to be able to have Bosman-like implications, if held up by higher courts.[4]

The Landesarbeitsgericht Rheinland-Pfalz has however taken a different road, one going in the (radically) opposite direction, by deciding that the contested fixed term contract period between a Bundesliga football club and a professional player can in fact be justified based on the objective reason of the nature of the work.[5] This case is an example of how the successful reliance on EU law ultimately depends on the interpretation of a national implementing measure by the competent national courts.[6]

This blog post will try to provide an insight in the court’s reasoning, addressing the four main arguments raised in the judgment. Followed by some point of criticism, making comparisons with the ruling in first instance, as well as the Dahmane v KRC Genk case.[7]  

The reasoning of the court

The Landesarbeitsgericht turns to the concept of the specificity of the work (“Eigenart der Arbeitsleistung”) in the second part of its decision.[8] It thereby immediately stresses that every ‘employment relationship’ has its particularities, which thus prohibits a broad interpretation of the nature of the work. It elucidates:

It therefore must be a specificity, the nature of which transcends in an exceptional way the particularities inherent to every (normal) employment relationship, wherein also industry specific features have to be considered.[9]

Thus, for the justification of Section 14 (1) (4) TzBfG to apply, it has to be a special ‘employment relationship’, which in an extraordinary way transcends the particularities inherent to any normal form of employment. The court follows by stating that the employment relationship between a Bundesliga club and a professional football player is characterized by specific features rendering it such special status.[10] The following arguments are substantiating this claim: 

1. Extraordinary high degree of uncertainty 

At the time of concluding the contract, there is an extraordinary high degree of uncertainty regarding the timespan the player can be employed successfully in the pursuit of the club’s sporting and thereto related economical goals.[11]

In the field of professional football, however, there are special features which lead to a degree of uncertainty significantly exceeding the one present at the conclusion of other employment contracts.[12]

The court substantiates this by referring to the possibility of injuries, leading to potential constraints on the player’s future performance. The latter is in any case dependent on many factors and thus only partially predictable. Other unforeseeable circumstances are put forward by the court that may affect the player’s use and performance in a team. It depends in particular on the manager’s tactical approach, the changes therein and the player’s adaptability to those changes. Group dynamics can negatively influence the individual performance. Moreover, in their constant strive for improvement, clubs take on new players, which may cause a previously valuable player to be no longer suited to the raised performance level of the team and the associated increased sporting objective of the club. This leads the court to believe that there is a legitimate interest for the club to use fixed term contracts.[13]

2. The particular need for a balanced age structure of the professional squad

A legitimate interest, to limit the contracts of professional players, derives from professional football’s immanent nature of the particular need, guided by the sporting goal, for a balanced age structure of the squad.[14]

From this a legitimate interest to use fixed term contracts can be derived. For reasons of competitiveness, clubs are constantly striving to “refresh” their squad. They achieve this by signing young players, introducing skilled players from their own youth department in the first team and possibly endow them with a professional contract. The court states that if professional players would have indefinite contracts, this would inevitably lead (in a certain time) to an immense inflation and total oversizing of the squad, which for most teams then would no longer be financeable.[15]

3. The public’s need for variety

Taking into account the public’s variety-need in assessing the legality of a fixed-contract is justified in light of the increasing commercialization of professional football and it having many similarities with the entertainment industry.[16]

Referring to case law in the area of theatre and stage arts, the court considers sports fans’ need for variety to be a specific feature of professional football. This aspect, in view of the increasing commercialization of professional football, further justifies the use of definite contracts. Fans of course want excellent performing players and crowd favourites (“Publikumsliebling”) to stay with the club on a long-term basis, yet this cannot be foreseen at the time of the conclusion of the contract. The court is however adamant that fans strive for variety with regard to the composition of the team as such.[17]

The public expects the club’s management to, from time to time, if not in every transfer window, improve and thus change the team by attracting new players.[18]

Thus, according to the court, the public expects the club’s management to attract new players and thus periodically change the composition of the team. Likewise it notes that, when concluding a contract, clubs and players need to start from the assumption that fans want change and, hence, want to see different players over time.[19] 

4. The player’s interests

Even from the player’s perspective, according to the court, the use of fixed term contracts is beneficial.

From the player’s side it is to be considered, that by the orderly conclusion of fixed-term contracts that cannot be terminated, the player’s risk of losing his job is, at least temporarily, lifted.[20]

Again referring to the imminent threat of possible injury, the court puts forward that a fixed term contract protects players particularly against early termination of the employment contract by personal compulsory redundancy. Furthermore, it is the court’s view that the ending of fixed term contracts creates room for possible subsequent transfers, deemed in the football player’s interests.[21]

Next, the court shortly addresses the typically extraordinary amount of remuneration paid in professional football (in the Bundesliga annually amounting to an average of 1.5 million euros). It takes note of the aim of EU Directive 1999/70/EC, being the improvement of the situation of weak and thus socially vulnerable workers and to prevent the emergence of a ‘precariat’ of always only temporary salaried workers. It subsequently notes that, in balancing the interests, the exceptionally high remuneration completely changes the scale in application of Section 14 TzBfG, however unfortunately without giving any further guidance.[22]

In an overall consideration of all these circumstances the court finds that the fixed term contract signed between Müller and Mainz 05, and thus the use of fixed term contracts in professional football in general, corresponds to the view of a sensible and reasonable contractual partner.[23] 

Und Jetzt? Some points of criticism

The Landesarbeitsgericht seems to have felt the need to soothe the debate that has arisen after the ruling in first instance. In direct opposition to the Arbeitsgericht Mainz, it has concluded that the contested fixed term contract period between a Bundesliga football club and a professional player can in fact be justified based on the objective reason of the nature of the work.[24] The protective stance in favour of the player provided by the Arbeitsgericht, together with the bulk of that court’s argumentation, has now been abandoned. Although the rationale given by the Landesarbeitsgericht for its ruling, especially the first and second argument (being for large parts in consensus with a commentator of the first instance ruling),[25] seems convincing to this author. Altogether, it still leaves room for further debate. 

On the one hand, with regard to the extraordinary high degree of uncertainty, the Landesarbeitsgericht even could have gone further by developing an argument based, not on the uncertainty of successful performance, but on the inevitability of a decline in physical performance.[26]

On the other hand, the court’s claim that the use of definite contracts is in the player’s own best interest seems rather circular, when it states that the ending of definite contracts at clubs makes room for subsequent transfers.[27] It moreover does not explain the precise influence of the high remuneration received in professional football in the balancing of interests under Section 14 TzBfG.[28] This author would have also liked some further elaboration on the courts assumption of the fans’ variety-need.[29]

Perhaps most importantly, by separating these ‘special employment relationships’ in professional football from normal employment, the Landesarbeitsgericht seems to have taken away the protective shield of labour law from the hands of the players/workers (supported in the ruling in first instance) and placed it right back at the feet of the clubs. It may be that the system of fixed term contracts is the most suitable in addressing the particularities of professional football,[30] and yes, the court has provided some valuable arguments for granting a justification based on the nature of the work. Still, the court must tread warily not to give clubs a carte blanche established on this special status of sport. Because, what would be the limits of this autonomy and how would these limits be policed?

In a previous Belgium case, the Dahmane v KRC Genk case (see our earlier blog post), the outcome was somewhat different. There, the Belgian court had to rule on a player’s unilateral termination of his labour contract with his club. In relation to this matter, the court decided, first, against a differentiation between football players and other professional athletes, and second, against a differentiation between professional athletes and normal workers. According to the Belgian court sport does exhibit certain particularities, however a perceived ‘specific nature of sport’ was not a decisive factor leading it to deviate from other labour relationships.

This reasoning is more in line with the Arbeitsgericht’s view in first instance regarding the question of the nature of the work. Be that as it may, the Landesarbeitsgericht does not concur, leaving us with yet another twist in this ongoing debate since the Bosman ruling. Can we speak of this perceived separate creature, being football or sport, and should this have a special status? And, if so, what should be the implications of this special status in relation to (EU) (labour) laws? These questions are far from settled.

[1] Landesarbeitsgericht Rheinland-Pfalz: Urteil vom 17.02.2016 – 4 Sa 202/15 (Appeal decision Heinz Müller case)

[2] FIFPro Press Release,Müller case is a wake-up call for football, 8 April 2015

[3] P. Drabik, Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case, Int Sports Law J (2016).

[4] “Successful lawsuit threatens time-limited contracts in football” http://www.dw.com/en/successful-lawsuit-threatens-time-limited-contracts-in-football/a-18341045.

[5] Landesarbeitsgericht Rheinland-Pfalz: Urteil vom 17.02.2016 – 4 Sa 202/15 (Appeal decision Heinz Müller case), II.1.b

[6] P. Drabik, “Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case”, Int Sports Law J (2016), p. 153, 157

[7] A.R. 2009/AH/199 (6 may 2014), Dahmane v KRC Genk

[8] Appeal decision Heinz Müller case, II.1.b

[9] “Es muss sich daher um eine vertragstypische, die jedem Arbeitsverhältnis innewohnende Besonderheit in einem außergewöhnlichen Maß übersteigende Eigenart handeln, wobei jedoch auch branchenspezifische Merkmale bzw. Gesichtspunkte zu berücksichtigen sind“ Ibid, II.1.b

[10] Ibid, II.1.b

[11] Ibid, II.1.b.aa

[12] “Im Bereich des Profifußballs bestehen indes Besonderheiten, die dazu führen, dass das Maß dieser Ungewissheit das insoweit bei Abschluss sonstiger Arbeitsverträge gegebene Unsicherheitsrisiko erheblich übersteigt“, Ibid, II.1.b.aa

[13] Ibid, II.1.b.aa

[14] “Ein berechtigtes Interesse, die Verträge der Lizenzspieler zu befristen, ergibt sich auch aus der dem Profifußball immanenten Eigenart der besonderen Notwendigkeit einer ausgewogenen, der sportlichen Zielsetzung gerecht werdenden Altersstruktur des Spielerkaders“ Ibid, II.1.b.bb

[15] Ibid, II.1.b.bb

[16] “Die Berücksichtigung des Abwechslungsbedürfnisses des Publikums bei der Befristungskontrolle ist im Hinblick auf die zunehmende Kommerzialisierung des Profifußballs, der mittlerweile vielerlei Ähnlichkeiten mit der Unterhaltungsbranche aufweist, gerechtfertigt“ Ibid, II.1.b.cc

[17] Ibid, II.1.b.cc

[18] “Das Publikum erwartet von der sportlichen Leitung des Vereins, dass diese von Zeit zu Zeit, wenn nicht sogar in jeder Transferperiode, die Mannschaft durch Verpflichtung neuer Spieler verbessert und damit zugleich auch verändert“ Ibid, II.1.b.cc

[19] Ibid, II.1.b.cc

[20] “Auf Seiten des Spielers ist zu berücksichtigen, dass diesem durch den Abschluss eines befristeten, ordentlich unkündbaren Arbeitsvertrages zumindest vorübergehend das Risiko des Verlustes seines Arbeitsplatzes genommen wird“ Ibid, II.1.b.dd

[21] Ibid, II.1.b.dd

[22] Ibid, II.1.b.dd

[23] Ibid, II.1.b.ee

[24] Ibid, II.1.b

[25] Piotr Drabik, “Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case”, International Sports Law Journal (2016), 15; 3-4, page 156

[26] As advocated in: Ibid, p. 152, 156,

[27] Appeal decision Heinz Müller case, II.1.b.dd

[28] Ibid, II.1.b.dd

[29] Ibid, II.1.b.cc

[30] As advocated in: Piotr Drabik, “Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case”, International Sports Law Journal (2016), 15; 3-4, page 153