Esport: How long can a player contract run?

In the context of the questions about transfer fees or talent promotion, professional teams or agencies in esport always ask themselves how long a contract with a player can actually run. Well, there are no clear rules, but normal labour law applies. There is also a massive difference between real employment contracts and marketing contracts (often called a freelancer).

Of course, the Basic Law is also relevant to the question, because in Article 12 it guarantees all Germans both the freedom to choose their profession and the freedom to practise their profession.

Of course, this right is limited and there must be a balance between the interests of the player and the team or agency when assessing a clause.
This is how the Heilbronn Labour Court ruled back in 2012:

An 18-month notice period agreed in an employment contract, applicable to both parties, does not infringe the fundamental right to choose between work and work in the case of an employee who holds a key position. (Az.: 5 Ca 307/11).

A key position is certainly occupied by a player in a team. However, the balance will depend on the level of salary, the exact position and other factors in the employment contract. So, with a contract for a mini-job, it will certainly not be possible to tie a player for more than a few months.

The Federal Labour Court also dealt with the question of a mutually extended notice period two years ago and had to clarify, among other things, whether the clause is a general meeting (see this article). I would like to share two quotations:

In an overall review of section 622 para. 5 BGB and Section 15 para. 4 TzBfG provides a legal limit for the retention of an employee of five and a half years. This already shows that the extension of the statutory notice period for dismissal by the employee is not limitless. Art. 1 sentence 1 GG guarantees, in addition to the free choice of profession, the free choice of the workplace. In the case of employees, this also includes the choice of the contracting party. The free choice of occupation is not exhausted in the decision to take up a profession. It also includes the continuation and termination of a profession. In addition to the choice of specific employment, the free choice of job also consists in the will of the individual to ensure employment. to maintain or give up […] In this regard, the Land Labour Court stated in an orderly manner that the defendant’s right to choose a job was not objectionable in respect of the law, despite the maintenance of the job, the increase in the basic salary by EUR 1,000.00. gross and the maximum remuneration to be achieved of EUR 2,800.00 gross is significantly and unreasonably restricted.

The level of salary is therefore also a decisive factor. In principle, therefore, a contract can also run for 5 1/2 years. Of course, as an employer, you must also be aware that you owe the salary and other benefits for as long as the player does not agree to a dissolution (as part of a transfer to another team).

The Federal Labour Court has also ruled with regard to the player Heinz Müller, the former goalkeeper of the Bundesliga club FSV Mainz 05, that fixed-term contracts for professional footballers are legal. In that regard, the General Court also relied on Paragraph 14(14) of the 1 Sentence 2 No. 4 Part-time and Temporary Employment Act and decided that temporary contracts which clubs give players for one, two or more years were justified on the basis of the nature of the performance of one of the licensed players. This is certainly how you can see it in esport.

I am not aware of comparable judgments for marketing contracts. In this respect, at most GTC law could apply, which is why such contracts may not run for more than 2 years on a regular basis, whereby again the remaining contract must also be measured by GTC law and the entirety of the regulations for the games must not be be surprising. The contracts I have seen so far in the German esports scene would rather not meet these standards.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.