On 30 August 2021, the Arbitration Committee of the KNVB (Royal Dutch Football Association) denied a termination request of Micky van de Ven, a player of FC Volendam (read the decision here). Van de Ven requested the Arbitration Committee to terminate the employment agreement before the expiry of the transfer period running up to and including 31 August 2021, and to award a termination fee to FC Volendam of no more than EUR 2,000,000. Van de Ven argued that termination was justified because he could realize an unusually big sportive and financial improvement with the German football club Vfl Wolfsburg, and because he considered the employment relationship with FC Volendam to be damaged.
Fixed-term contracts to protect the transfer system
The pro football sector is characterized by fixed-term contracts. Employment agreements with pro football players are excluded from the sequence system and under the applicable CAO for contracted players, during a period of 12 years maximum, consecutive fixed-term contracts can be concluded between a football player and a club.
In practice, these contracts hardly ever include an interim termination clause that permits the player to give notice without paying compensation. These contracts do regularly contain a clause saying that a player may terminate the employment agreement prematurely upon payment of a limited termination fee (also known as a “limited transfer fee”). This way, the transfer system used in the football sector is protected, so that players cannot switch to other clubs prematurely without paying a fee to their current club. In Van de Ven’s employment agreement there was no option of interim termination or a limited transfer fee.
Termination of a fixed-term employment agreement in pro football
An employment agreement can only be terminated at the request of the employee – the football player – if there is such a change of circumstances that the employment agreement should, in fairness, either end promptly or after a short time. According to the Arbitration Committee, in the pro football sector this will only be the case in very special circumstances. The Arbitration Committee also considered it relevant that football players and clubs are professional parties, and as such they are in principle bound by the contractual arrangements they make in an employment agreement.
It depends on all circumstances of the case whether special circumstances exist. Some questions relevant in this context are whether the parties intended to provide for the possibility or impossibility of a premature termination; whether an irreparably damaged employment relationship exists; or whether a considerable sportive and financial improvement of position exists. Other factors are the duration of the employment agreement between the parties; the time the employment agreement has already lasted; the age of the player; whether the agreement was recently concluded or extended; and the time when and as of which the termination is requested.
Opinion Arbitration Committee
According to the Arbitration Committee, there are no special circumstances in this case that justify termination. The Committee considered it particularly relevant that at the time when the proceedings were instituted, no concrete offer of employment had been extended by another club to Van de Ven (the offer of Vfl Wolfsburg having already expired), and that FC Volendam had not acted unreasonably, in the opinion of the Committee, in the negotiations about the level of a termination fee or transfer fee. Moreover, it is observed that clubs are free to choose their negotiating strategy, and that the termination fee a club requires may be higher than the ‘market value’ of the player.
The considerations of the Arbitration Committee are in line with earlier rulings, including those between the De Boer brothers – who wanted to force a transfer to FC Barcelona – and the case of Ajax (1998) and Luis Suarez – who wanted to join Ajax – against FC Groningen (2007). These cases also show that termination of a football player’s employment agreement is not allowed lightly. A request for termination will be particularly prospectless if financial and sportive progress is absent or limited. Besides, the fact that a club asks a high termination fee in negotiations is as such insufficient to justify the termination of the employment agreement.
If you have any questions, feel free to contact Tim Wilms.
