Employment disputes in sports arbitration: comparing Latvia and Lithuania

In the Sports Law all and any disputes are often subject to “specialised dispute resolution bodies” and different arbitrations.

Sports organizations usually do not distinguish employment or labor disputes from the other disputes that might arise. There have been discussions as to the principle, and different countries have their own rules for this. National jurisdictions are not always thinking the same way as the global sports organisations.

Latvian Law is strict on the employment dispute arbitrability. In this article you will find a comparison of Latvia with Lithuania.


Latvian Law

In this section let’s briefly look at the Latvian provisions on the employment disputes.

Arbitration Code against labor disputes

The Latvian “Arbitration Code” prohibits the arbitration institution or chamber or court to undertake a review and settling an employment or labor law dispute between an employer and an employee.

Article 5 paragraph 1 subsection 7 provides the following:

Section 5. Jurisdiction of an Arbitration Court

(1) An arbitration court shall resolve any civil legal disputes, provided that the parties have voluntarily agreed upon and concluded an arbitration agreement, except for the following disputes:

(…)

7) between an employee and an employer, provided that the dispute has arisen due to concluding, amending, terminating or fulfilling an employment contract, or due to applying or interpreting legal norms, or the provisions of a collective agreement or work procedure regulations (individual employment relations dispute); (…)

Translation taken from the site: https://likumi.lv/ta/en/en/id/269189-arbitration-law

Labor Dispute Law on arbitrability

Labour Dispute Law confirms the same approach as the above Law.

Section 7. Settlement of an Individual Dispute Regarding Rights in Court

(…)

(4) An individual dispute regarding rights shall not be settled in an arbitration court.

Translation taken from the site: https://likumi.lv/ta/en/en/id/67361-labour-dispute-law

However, a collective dispute (collective bargaining and with participation of unions related) can be arbitrated. The same goes for collective interests disputes.


Lithuanian Law

Briefly, the approach is similar to the Latvian approach. An institution that is not a state court, by that meaning an arbitration, has its competence and jurisdiction strictly limited.

Lithuanian Labor code limits arbitration of employment disputes

Article 216 of the Lithuanian Labor Code (Darbo kodeksas), provides that disputes in employment law field can be reviewed strictly in compliance with provisions of the specialized law. Such situation is to permit arbitration when the dispute is already ongoing. In practical terms, a general prior agreement to arbitrate any disputes is not valid.

The allowed exceptions in Lithuania

The Lithuanian Law on commercial arbitration provides guidance, as indicated in the Labour code (Lietuvos Respublikos komercinio arbitražo įstatymas, I-1274).

One of the prohibitions to arbitrate concerns emplpoyment disputes,

The national state courts can be deprived of their jurisdiction of a dispute when the parties agree so, when the object of dispute already is existing. I.e., you can only agree after you have a real dispute. It means that you cannot have an employment agreement template with sample clause from the beginning or even Statutes or Articles of association that provide for mandatory arbitration for next years to come.

That being said, we see that the Lithuanian approach being more liberal. While in Latvia only state courts are allowed to review employment disputes, the Lithuanian principle is to have in particular situation a mutual agreement.

Why so? Because the employee is considered the weaker side. At the beginning of relations employer can enforce more unfavorable provisions. Thus, where the employee has already been brave enough to raise a voice and is in a dispute, Lithuanian Law considers that mutual agreement becomes permissible. Latvian lawmakers have considered that this is not yet possible in Latvia.

In real life, of course, we do know that there may be situations when the roles are different and the employer feels like to weaker party.


CAS case law on national procedures

The CAS has indicated that it accepts national law taking priority over sports law on dispute jurisdiction.

In case when a party may choose its preferred way of dispute resolution, CAS has provided a few guidelines as to the practicalities when doing so:

  • CAS case Nr. 2019/A/6626, Club Al Arabi SC v. Ashkan Dejagah
  • CAS case Nr. 2007/A/1301, Ituano Sociedade de Futebol Ltda v. Silvino João de Carvalho, Buyuksehir Belediyesi Ankaraspor & Fédération Internationale de Football Association (FIFA)

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