Employment Law for Professional Athletes

Legal advice is an essential part of a professional athlete's daily life — particularly when it comes to the contracts they will sign with clubs and sporting organisations throughout their career.

Josep Conesa. employment lawyer (Barcelona)

Written by Josep Conesa

Employment and insolvency lawyer

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It is important to note that the employment relationship of professional athletes is classified as a special employment relationship under Spanish law. This means it is governed by specific regulations which, while sharing a common foundation with the Workers' Statute that applies to ordinary employment relationships, introduce particular rules reflecting the unique nature of an athlete's work.

The legislation governing this special employment relationship is the Royal Decree 1006/1985, of 26 June, regulating the special employment relationship of professional sportspeople.

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WHAT A PROFESSIONAL ATHLETE'S CONTRACT WITH A CLUB MUST INCLUDE

The contract between a professional athlete and a club must be drawn up in writing and in triplicate. One copy is for each party and the third must be submitted to the public employment office (formerly the INEM). In other words, contracts must be registered with the relevant employment office.
It must include, at a minimum:
- identification of the parties
- the subject matter of the contract
- the remuneration, with a breakdown of all pay components, review clauses and payment schedules (where only expenses are received, a different type of contractual relationship applies)
- the duration: which must always be for a fixed term, clearly identified as such, with the possibility of extensions by way of successive subsequent agreements.

It may include a probationary period of less than three months.

WHAT IS THE REMUNERATION OF A PROFESSIONAL ATHLETE?

The remuneration of professional athletes shall be that agreed upon in the collective bargaining agreement or individual contract.
All payments received by the athlete from the club or sports entity, whether in cash or in kind, as remuneration for the provision of their professional services, shall be legally considered salary.
Excluded are any amounts which, under current employment legislation, do not constitute salary (such as per diems, within the legally established limits).

What are the working hours of a professional athlete?

The working hours of a professional athlete shall comprise:

the actual provision of their services before the public
the time during which they are under the direct authority of the club or sports entity, that is, during training or physical and technical preparation for the same.

The duration of working hours shall be that set out in the collective bargaining agreement or individual contract.

The applicable statutory limits must be observed, and may be calculated on an annual basis.
Pre-competition concentration periods shall not be counted towards working hours.
Travel time to the venue of competitions shall not be counted towards working hours (although its duration may be regulated through collective bargaining).

WHAT REST PERIODS AND HOLIDAYS ARE PROFESSIONAL ATHLETES ENTITLED TO?

Weekly rest:
- They shall be entitled to a minimum weekly rest period of one and a half days, to be set by mutual agreement, which shall not coincide with days on which the professional sporting activity is performed before the public.
- If the rest period cannot be taken consecutively due to the sporting commitments of the club or sports entity, it shall be transferred to another day of the week.
- Where there are immediate upcoming sporting commitments, the minimum weekly rest period may be calculated as equivalent to thirty-six hours.
Public holidays included in the official calendar: where these cannot be taken, the rest day shall be transferred to another day of the week.
Annual leave: thirty calendar days of paid annual leave per year; the timing and any possible splitting of leave shall be agreed by collective bargaining agreement or in the individual contract.

Temporary loan of a professional sportsperson to another club:

Clubs or sports entities may temporarily loan the services of a professional sportsperson to another club or entity, with the sportsperson's express consent.
The club or sports entity must consent to the temporary loan to another club or sports entity where, throughout an entire season, the sportsperson's services have not been called upon to participate in official competition before the public.
Duration of the loan:
- The loan agreement shall expressly state its duration
- It may not exceed the remaining term of the professional sportsperson's contract with the originating club or entity.
- The receiving club shall be subrogated to the rights and obligations of the transferring club, with both parties jointly and severally liable for compliance with employment and Social Security obligations.
Loan of sportspersons in exchange for financial consideration:
- The sportsperson shall be entitled to receive a minimum of 15% gross of the amount agreed between the clubs.
- That minimum amount may be higher if so agreed between the sportsperson and the club.
- In the event of a reciprocal exchange of sportspersons, each of them shall be entitled to:
  - at minimum, from the originating club, an amount equivalent to one month's periodic remuneration; and
  - additionally, one twelfth of the performance and productivity supplements received during the previous year.

Suspension of a professional sportsperson's employment contract

A professional athlete's contract may be suspended on the same grounds set out in the Workers' Statute:

Mutual agreement of the parties.
Grounds validly stipulated in the contract.
temporary disability (IT) of the employee.
Birth, adoption, guardianship for adoption purposes, or foster care, in accordance with the Civil Code or the civil laws of the Autonomous Communities that regulate such matters, provided the duration is not less than one year, in respect of children under six years of age or of minors over six years of age with a disability or who, due to their personal circumstances and experiences or by reason of coming from abroad, face particular difficulties of social and family integration, as duly certified by the competent social services.
Risk during pregnancy and risk during breastfeeding of a child under nine months of age.
Exercise of a representative public office.
Deprivation of liberty of the employee, provided no conviction ruling has been handed down.
Suspension of employment and pay for disciplinary reasons.
Temporary force majeure.
Economic, technical, organisational or production-related grounds.
Compulsory leave of absence.
Exercise of the right to strike.
Lawful closure of the company.
Decision by a female employee who is compelled to leave her post as a result of being a victim of gender-based violence or sexual violence.
Voluntary or compulsory leave of absence (see Article 46 of the Workers' Statute and this link to an article on our blog about voluntary leave of absence)
Reduction of working hours or suspension of contract on economic, technical, organisational or production-related grounds, or grounds arising from force majeure.

Suspension releases both parties from their reciprocal obligations to work and to remunerate work.

How a professional athlete's contract is terminated

The employment relationship shall be terminated on the following grounds:

Upon full performance of the contract.
By reason of death or injury causing the athlete total or absolute permanent disability or severe disability. In such cases, the athlete or their beneficiaries shall be entitled to receive compensation of no less than six months' salary where the death or injury arises from the practice of sport, without prejudice to any Social Security benefits to which they may be entitled.
By dissolution or winding-up of the club or the relevant sports entity, by resolution of the General Assembly of Members. In such cases, the collective dismissal or Collective Dismissal Procedure (ERE) procedure shall be followed.
By financial crisis within the club justifying a restructuring of the squad of athletes.
By grounds validly stipulated in the contract, provided they do not constitute a manifest abuse of rights on the part of the club or sports entity.
By mutual agreement of the parties.
1. Where termination arises from the permanent transfer of the athlete to another club:
  1. the terms agreed by the parties regarding the financial conditions of contract termination shall apply.
  2. in the absence of any such agreement, the minimum amount payable to the athlete shall be 15% gross of the stipulated sum.
By expiry of the agreed term.
1. Where, following termination of the contract by expiry of the agreed term, the athlete enters into a new contract with another club or sports entity, a training or development compensation may be agreed upon by means of a collective bargaining agreement, payable by the new club to the club of origin.
2. Where the engagement of foreign athletes by Spanish clubs is subject to rules other than those set out above, in accordance with the legal framework of the athlete's country of origin, reciprocity criteria shall apply to the engagement, by foreign clubs or sports entities, of athletes linked to Spanish clubs.
3. Successive contracts that may be entered into with other Spanish clubs by foreign athletes engaged in accordance with the provisions of the preceding paragraph may continue to be governed by the legal framework applicable under the first such contract for these purposes.
4. Payments in foreign currency must comply with Royal Decree 2402/1980 of 10 October on the obligation to issue and deliver invoices, and shall therefore require authorisation from the Directorate-General for External Transactions.
By dismissal of the athlete.
1. In the event of unfair dismissal, without reinstatement, the professional athlete shall be entitled to compensation which, in the absence of agreement, shall be determined by a court and shall amount to at least two months' periodic remuneration, plus the proportional share of performance and productivity supplements received during the preceding year, with periods of less than one year prorated on a monthly basis, per year of service. When calculating the amount, all relevant circumstances shall be taken into account, in particular the remuneration that the athlete failed to receive as a result of the early termination of the contract.
2. dismissal based on a serious contractual breach by the athlete shall not entitle the athlete to any compensation. In the absence of a specific agreement, the employment jurisdiction may award compensation in favour of the club or sports entity, based on the economic losses suffered.
At the professional athlete's own initiative.
1. Termination of contract at the professional athlete's initiative, where no fault is attributable to the club, shall entitle the club, where applicable, to compensation which, in the absence of a specific agreement, shall be determined by the judge having regard to the sporting circumstances, the harm caused to the entity, the reasons for the breakdown, and any other factors the judge considers relevant.
2. Should the athlete, within one year from the date of termination, enter into a services agreement with another club or sports entity, that club or entity shall be subsidiarily liable for the payment of the aforementioned financial obligations.
3. Termination of contract based on any of the grounds arising from the employer's breach (Article 50 of the Workers' Statute) shall produce the same effects as unfair dismissal without reinstatement.
  1. Substantial changes to working conditions carried out without complying with the procedure set out in Article 41 of the Workers' Statute that undermine the dignity of the employee.
    
    b) Failure to pay or persistent delays in the payment of the agreed salary.
    
    c) Any other serious breach of obligations by the employer, except in cases of force majeure, as well as the employer's refusal to reinstate the employee to their previous working conditions in the circumstances provided for in Articles 40 and 41, where a judicial ruling has declared such changes unjustified.

What disciplinary offences or sanctions can a club impose on a professional athlete?

Contractual breaches by the athlete may be sanctioned by the club or sports entity according to their severity.
All sanctions imposed may be appealed before the employment jurisdiction.
collective bargaining agreements shall establish the classification of offences and sanctions, which may include financial penalties arising from the employee's breach of contract.
Sanctions may not be imposed for off-field conduct or behaviour unrelated to sport, unless such conduct seriously and adversely affects the athlete's professional performance or materially damages the image of the club or sporting entity.
Sanctions consisting of a reduction in the duration of annual leave or any other curtailment of the athlete's right to rest are likewise prohibited.

What RIGHTS does the CLUB have in relation to the professional athlete

To issue orders and instructions in the regular exercise of its management powers.

What rights does a professional athlete have in relation to the club:

The right to express opinions freely
The right to benefit from the commercial exploitation of their image, as determined by the applicable collective bargaining agreement or individual agreement with the club (except as otherwise agreed in contracts for shows, companies or commercial brands).
The right to effective employment, except in cases of sanction or injury. Athletes may not therefore be excluded from training sessions or other preparatory activities.
The right to work and to freely choose a profession or trade.
The right to join a trade union (however, the contract may not be suspended on grounds of trade union representation, unless the athlete concerned and the club or sporting entity agree otherwise).
The right to collective bargaining.
The right to take collective dispute measures.
The right to strike.
The right to assembly.
The right to information, consultation and participation within the company.
The right to professional development and training at work.
The right not to be discriminated against, directly or indirectly, in access to employment or during employment, on grounds of sex, marital status, age within the limits set by law, racial or ethnic origin, social condition, religion or belief, political views, sexual orientation, trade union membership or non-membership, or language, within Spain.
The right to physical integrity and an adequate occupational health and safety policy.
The right to have their privacy respected and to be treated with due regard for their dignity, including protection against harassment on grounds of racial or ethnic origin, religion or belief, disability, age or sexual orientation, and against sexual harassment and harassment on grounds of sex.
The right to timely receipt of the agreed or legally established remuneration.
The right to pursue individual actions arising from their employment contract.
The right to any other entitlements arising specifically from their employment contract.

what OBLIGATIONS does the professional ATHLETE have towards the club:

To carry out the sporting activity for which they were engaged
To perform their activity with due diligence
To fulfil the specific obligations of their role, in accordance with the principles of good faith and diligence.
To comply with the occupational health and safety measures adopted.
To follow the orders and instructions of the employer in the lawful exercise of their managerial powers.
Not to engage in activities that compete with the company, on the terms set out in this law.
To contribute to improving productivity.
To fulfil any further obligations arising, where applicable, from the respective employment contracts.