Request for Leave to Appeal (National) 19063-02-21 Hapoel Ra’anana Football Club – Eli Babayev - part 2

The Maof Histadrut - a trade union belonging to the new General Workers' Union, which is intended to bring together administrative and farm workers and clerks in a variety of sectors of the economy and handles, among other things, soccer players (hereinafter: the "Histadrut").

3. The course of the judgment will be as follows: First, a summary of the facts relevant to the matter, a summary of the arguments of the direct parties to the proceeding and a summary of the arguments of the necessary parties that were attached to the proceeding, including the position of the Attorney General and the conduct of the proceeding before us, which was different from previous cases, in that the necessary parties announced their intention to negotiate the improvement of the arbitration process of the Arbitration and Mediation Institute (hereinafter: the "Arbitration Institute") of the Association. In light of the Tribunal's comments. Afterwards, the existing legal situation will be reviewed and our decision will be given in the proceedings of the direct parties.

Summary of the facts that need to be addressed

1. Babayev's lawsuit
2. On October 6, 2020, Mr. Eli Babayev, a professional soccer player, filed a lawsuit with the Tel Aviv Regional Labor Court (hereinafter: "the Tel Aviv Regional Court") against the Hapoel Ra'anana Football Club (hereinafter: "Hapoel Ra'anana"), where he played for eight years. (Hereinafter: "Interest in Babe"). As part of the lawsuit, Mr. Babayev claimed that he was entitled to severance pay, convalescence pay, redemption of annual leave, compensation for withholding of wages and withholding of severance pay, as well as payment for work on the Sabbath.  Babayev placed his claim at ILS 631,977.
3. In parallel with the filing of a statement of defense on behalf of Hapoel Ra'anana, on December 13, 2020, it filed a "motion to stay proceedings, dismissal in limine, transfer the hearing for clarification before the Arbitration and Mediation Institute of the Football Association" (hereinafter: "The Motion to Stay Proceedings in the Babayev Matter"). In the framework of which it was argued that Mr. Babiev submitted the claim to the Labor Court in order to overcome the statute of limitations, when in practice he should have applied to the Arbitration Institute, which has the exclusive authority to hear his claims by virtue of Sections 10(a) and 11 of the Sports Law and by virtue of Regulations 2 and 3 of the Regulations; that the claim was filed for events related to Mr. Babiev's employment as a football player subject to the Association's bylaws and that specific expertise is required to hear it; and that in accordance with Section 5 of the Arbitration Law, 5728-1968 (hereinafter: the "Arbitration Law"), the proceeding must be delayed, transferred to the Arbitration Institution and even ordered to dismiss the claim in limine due to lack of authority.
4. In response, Mr. Babaev argued that the motion should be dismissed in limine, since the remedies claimed concern protective rights in labor law, which cannot be stipulated, and that these remedies are within the exclusive jurisdiction of the Labor Court. Alternatively, he argued that even if some of the components of the claim can be arbitrated, it would be appropriate to hear the claim under the same roof.  In the Labor Court.  He also added that even if it were a contractual claim, the authority to hear it is parallel, i.e., it is given to both the Labor Court and the Arbitration Institute, and is not exclusive to the Arbitration Institution.
5. The Tel Aviv Regional Court rejected the request to stay proceedings in the Babayev case, ruling that according to Jewish law, rights in protective labor law are not "arbitratable."
6. Ben Shushan's Claim
7. On April 1, 2020, Mr. Amit Ben Shushan filed a lawsuit with the Jerusalem Regional Labor Court (hereinafter: "the Jerusalem Regional Court") against the A.G. Beitar Jerusalem Football Club (2001) in a tax appeal (hereinafter: "Beitar Jerusalem"), in which he played for more than nine years (hereinafter: "the Ben Shushan case"). As part of the lawsuit, Mr. Ben-Shushan claimed that he was entitled to severance pay, convalescence pay, redemption of annual vacation pay, holiday pay, days of advance notice, compensation for withholding wages and withholding of severance pay, as well as payment for work on the Sabbath.  Ben Shushan placed his claim in the sum of ILS 2 million.
8. On July 1, 2020, Beitar Jerusalem filed a "motion to stay proceedings and transfer the hearing to an arbitrator on behalf of the Arbitration Institute of the Israel Football Association," as well as a motion to dismiss the lawsuit in limine in light of the delay in filing it, and alternatively to delete the components that had become obsolete (a statement of defense was filed the day before). As part of the motion, Beitar Jerusalem argued that in accordance with the Sports Law, the Israel Football Association has the authority to establish internal judicial institutions in order for them to decide disputes in the industry. including in relation to the payment of players' salaries.  It also noted that the form accompanying the players' contracts, signed by the plaintiff, contains an arbitration clause and referred in this context to the Ben Yosef case [Labor Dispute (Jerusalem) 57268-08-18 Tomer Ben Yosef - A.G.  Beitar Jerusalem Football Club (2001) in Tax Appeal [Nevo] (February 17, 2020) (hereinafter: "the Ben Yosef Case")], arguing that the proceedings should be delayed in light of the arbitration clause contained in Mr. Ben Shushan's agreement.
9. In response, Mr. Ben-Shushan argued that according to the rulings established by the National Labor Court, the Labor Court has the exclusive authority to adjudicate on the protective rights for which it is suing, and therefore the decision should not be transferred to the Arbitration Institute, even if it was established by virtue of the Sports Law. Ben-Shushan also noted that splitting the claim so that the components that are not part of the protective laws will be heard before the Arbitration Institute, will lead to contradictory decisions, and therefore the claim should be clarified under one roof.
10. On January 21, 2021, the Jerusalem Regional Court ordered a stay of the proceedings in the Ben Shushan case. In the framework of the decision, Judge (as described at the time) Bruiner Isherzada ruled that the arbitration clause in agreements signed by the players should be preferred over the exclusive jurisdiction of the Labor Court in all matters relating to protective rights.

• Applications for leave to appeal in this case

12. On January 24, 2021, Hapoel Ra'anana filed an application for leave to appeal against the decision of the Tel Aviv Regional Court on a request to stay proceedings (Application for Leave to Appeal 44937-01-21, hereinafter: "Hapoel Ra'anana"). On February 9, 2021, Mr. Ben-Shushan filed an application for leave to appeal against the decision of the Jerusalem Regional Court on a request to stay proceedings (Request for Leave to Appeal 19063-02-21, hereinafter: "A. Ben Shushan").
13. In decisions dated February 1, 2021 (Hapoel Ra'anana's request for leave to appeal) and March 16, 2021 (Ben Shushan's request for leave to appeal), Judge Roy Poliak ordered that the hearing be set before the panel and that the Association, the Administration, and the Histadrut be added as required parties to the proceeding.
14. In a decision dated March 11, 2025, it was determined that in light of the termination of the term of the two public representatives who sat in the proceeding, Mr. Yossi Rahamim and Mr. Shraga Weizman, the public representatives would be replaced by the public representative, Ms. Varda Edwards, and the public representative, Mr. Dubi Ram. As part of the decision, it was clarified that the judgment would be given on the basis of all the material in the case, including the parties' oral arguments at the hearing.

Summary of the parties' arguments in the framework of the application for leave to appeal Hapoel Ra'anana

15. Hapoel Ra'anana argued that the dispute in question is a dispute in the field of sports, which according to the provisions of the law - the Arbitration Law, the Sports Law, the Arbitration Institution's Bylaws and case law - the arbitration institution has the substantive authority to adjudicate it; that Sections 10 and 11 of the Sports Law stipulate "a statutory obligation to hold arbitration proceedings in internal institutions of the sports associations" and therefore the Tel Aviv Regional Court should have ordered the stay of the proceedings by virtue ofSection 5 of the Arbitration Law; that the decision is not sufficiently reasoned, "full of contradictions" and ignores current relevant case law, which teaches that preference should be given to the Association's arbitration institution (such as the Ben Yosef case; Labor Dispute (Tel Aviv) 53107-06-18 STORIES NINI - MACCABI AVSHALOM PETAH TIKVA - FOOTBALL DEPARTMENT (N.O.) [NEVO] (2.10.2018) - Hereinafter: "The NINI case; and - Labor Dispute (Tel Aviv) 7449-10-16 Elihan - Hakoah Maccabi Amidar Ironi Ramat Gan in Tax Appeal [Nevo] (18.12.2021) - hereinafter: "The Elihan Case"].
16. In addition, it was argued that the arbitrators in the Association's institutions are experienced lawyers with specific knowledge of disputes in the field of football, who have the tools and expertise to resolve disputes in the best possible way; that in section 10(a) of the Sports Law, the legislature authorized the Association to manage the football industry, including the enactment of regulations for regulating wages and payments; that these regulations are binding on all those involved in the sport of football; and that a player belonging to the Association accepts the regulations. For all of the above reasons, Hapoel Ra'anana was of the opinion that preference should be given to the internal judicial institutions of the Football Association, which has the relevant knowledge in the unique industrial context of the football industry, which is often not suitable for labor laws in the classical sense. In addition, it was argued that the agreement signed by Mr. Babiev (the "Players' Agreement Form") is a uniform and cogent agreement that applies to all sports associations, in which it was determined that the agreed consideration was final and included severance pay and social conditions; and that Mr. Babiev's signature on the agreement indicates that he accepted his terms without reservation.
17. Babev argued in response that the decision of the Regional Court should not be interfered with and that the application should be rejected because it lacked a factual and legal basis. In doing so, he argued that the request to transfer the hearing to the Arbitration Institution contravenes the provision of section 24(a)(1) of the Labor Court Law, 5729-1969 (hereinafter: "the Labor Court Law"), which grants the Labor Court exclusive substantive authority to hear claims for social rights by virtue of the protective legislation; and that according to Halacha "remedies derived from protective laws... cannot serve as a matter between the parties as defined in section 3 of the Arbitration Law...[1]"; He also argued that Hapoel Ra'anana presented the case law in a tendentious manner, which implies that the tendency in similar cases is to delay proceedings; and that in the Ben Yosef case, in which the proceedings were delayed by the Regional Court, an application for leave to appeal was filed and the National Court returned the hearing to the Regional Court and not to the Arbitration Institute.  In addition, it was argued that, according to the ruling of other municipal applications 825/88 Football Players' Association in Israel v.  Israel Football Association, IsrSC 45(5) 89 (hereinafter: "the Football Players Association Case"), the normative status of the Arbitration Institution's bylaws is lower than that of a sub-regulation and therefore the provision of section 24(a) The Labor Court Law overrides the provisions of the Regulations; that even if the arbitral institution had a parallel authority to that of the Labor Court, the Labor Court would have the expertise to adjudicate rights by virtue of protective laws; and that the claim should not be split, for fear of contradictory decisions and harm to the efficiency of the hearing.  Finally, it was argued that the application should be dismissed in limine and that Hapoel Ra'anana's request to dismiss the claim in limine should not be accepted.

Summary of the parties' arguments in the framework of Ben Shushan's application for leave to appeal

18. Ben-Shushan argued that the Regional Court ignored the case law and the fact that the application for leave to appeal filed in the Ben Yosef case was granted, the stay of the proceedings was canceled and the proceeding continued to be conducted in the Labor Court. In addition, Mr. Ben-Shushan referred to the opposite decision given by the Tel Aviv Regional Labor Court in the Babayev case, as well as to a series of rulings in which it was determined that the protective law should not be stipulated and that the appropriate forum to hear disputes concerning these rights is the Labor Court.
19. It was also argued that the claims of the "uniqueness of the football industry" and the recognition of the authority of the institution to arbitrate should not be accepted, since in practice it is a relationship between an employee and an employer and the rights and obligations derived from this relationship. Ben-Shushan added that even if the claim that this was a contractual claim had been accepted, even then there would have been parallel - and not exclusive - authority to the Arbitration Institute and the Labor Court. According to him, the rights to which he is entitled are at the core of the occupation of the labor courts and within their unique authority.
20. In addition, it was argued that from a normative point of view, the Labor Court Law and the Arbitration Law prevail over the Sports Law; and that the Sports Law preceded the precedent according to which soccer players would be classified as employees - and therefore Section 10 of the Law, according to which the players' wages and payments will be discussed in the frameworks of the internal judicial institutions, does not indicate that the reference by "wages and payments" is to the players' wages. Ben-Shushan added that all the arguments raised by Beitar Jerusalem were argued and rejected long ago in the Volk case. Finally, it was argued that all the components of the claim derive from cogent rights; and that according to halakha, in any case, the claim should not be split.
21. In response, Beitar Jerusalem argued that there was no justification for granting leave to appeal, since it was a procedural decision in which the appellate court would not intervene unless there was a material defect in it - a requirement that does not exist in our case. Therefore, in its opinion, the request should be rejected and the decision to stay the proceedings should be left in place. On the merits, Beitar Jerusalem argued that the employment of a soccer player is not similar to the employment of a "regular" employee, and therefore some of the provisions of the protective legislation become unapplicable.  In addition, It was noted that Ben-Shushan's request for leave to appeal does not relate to the reasons for the decision to stay the proceedings - including the public interest in reducing the burden on the court system; the efficiency of the arbitration institution and the special characteristics of the actors, who cannot be considered "disadvantaged" employees, such as Mr. Shushan, who earned about ILS 1.59 million per year.
22. It also argued that the Arbitration Institute is the body with unique expertise in the sport of football; that the arbitrators have relevant experience and the required proficiency in the field; that they are elected by a committee with the consent of all the bodies in the industry, including the players' representatives (the Histadrut); and that if necessary, judicial review will be exercised by the Labor Court.
23. According to her, in an engagement in the football industry, all parties accept the arbitration clause in the players' agreements and the authority of the Arbitration Institute to decide any issue related to the relationship between the teams and the players, including questions in the field of protective legislation, subject to judicial review by the Labor Court. According to her, alongside the ruling, there are rulings of the regional courts that have determined that there is justification for transferring the footballers' claims to the arbitration institute even when they are grounds by virtue of the protective laws and indicate the need to change the rule [ For example, the Ben Yosef case; Miscellaneous Applications Civil 2842/09 Hapoel Kfar Saba Football Club Management Company - Eliezer Lennart Speier [Nevo] (October 27, 2003); Labor Dispute 70645-11-16 Itay Grinbaum - Bnei Ramat Gan Basketball Department [Nevo] (January 29, 2017)].
24. In addition, it was argued that in the relationship between the Labor Courts Law and the Sports Law, the provisions of the Sports Law prevail since it is a specific law and is late in time. Therefore, according to the Arbitration Institute, the arbitration institution has the authority to hear matters of wages and payments, in accordance with section 10(a) of the Sports Law, which states that the Association must amend bylaws that will regulate these issues.
25. Finally, it was argued that a decision should be made that will create certainty in the football industry, and therefore the time is ripe to update the rule, so that it will be determined that the arbitration institution "has unique authority to also hear claims relating to protective laws in labor law, under the supervision of the Labor Court sitting as an arbitration court."

Summary of the arguments of the necessary parties attached to the proceeding

26. According to the position of the Association (which was submitted in the application for leave to appeal Hapoel Ra'anana and to which it referred in the application for leave to appeal Ben Shushan), in accordance with the provisions of sections 10(a) and 11 of the Sports Law, claims in the football industry must be clarified before the Association's internal judicial institutions. According to the Association, these institutions have the unique knowledge and expertise in the field of football and their rulings will be subject to the rulings of the labor courts, with the relevant changes in light of the uniqueness of the sport, and subject to judicial review by the courts and labor courts. It was also noted in the framework of the position, that the Histadrut was an active partner in drafting the amendments to the Arbitration Institute's bylaws; and that the committee appointing the arbitrators is also composed of a representative of the Histadrut (the players' representative) whose voice is equal to that of the league administration (the representative of the teams).  In the supplementary position she submitted in Ben-Shushan's request for leave to appeal, it was noted that the players' salary figures are significantly higher than the average wage in the economy.
27. The Administration's position is that disputes between parties to the Israeli football industry should be fully discussed before the Arbitration Institute, as it is the professional body with expertise in the field. According to her, she worked in full cooperation with the Histadrut in order to establish the status of the Arbitration Institution and increase public confidence in it, including through attempts to update the Arbitration Institute's statutes while implementing the European Union's "Blue Book".
28. The Histadrut argued that the decision in the Babayev case is based on law, since the Labor Court is the body with the authority (by virtue of primary legislation) and the expertise to hear the matter of soccer players; that the association's bylaws provide for mandatory arbitration in a dispute relating to contractual relations, as opposed to protective rights; that the arbitration institution is not subject to substantive law and therefore should not be allowed to discuss cogent rights; that the players' public must be protected and not allowed to bypass in the form of uniform employment contracts that violate cogent rights; that many players in the industry earn money low wages; that the "expertise" of the Arbitration Institute should not be preferred over the Labor Court, just as other bodies in industries with unique characteristics are not preferred over the Labor Court; that transferring disputes to an arbitration institution would infringe on the actors' right to access the courts; and that the association does not respect the rules of equal representation according to UEFA's "Blue Book", which shows the problematic nature of reducing the court's authority.

In a supplementary opinion submitted on its behalf in Ben Shushan's application for leave to appeal, the Histadrut added that there was no justification for the regional court's reliance on the decision of President (as he was then called) Avrahami in the Ben Yosef case, which was revoked by this court; and that the expansion of the jurisdiction of the arbitration institution may have implications for other sports to which the Sports Law also applies.  It also emphasized, Because even though she was summoned to a hearing regarding the amendment of the Arbitration Institute's bylaws, she was not given the right of veto or the right of participation, and the decisions were made by the Association.

29. Beitar Jerusalem responded to the Histadrut's position and argued that the Histadrut's position and Ben Shushan's request for leave to appeal should be rejected. In the meantime, it was argued that there was no impediment to basing the decision in the Ben Yosef case, since it was canceled in this court for procedural reasons only; that the uniqueness of the soccer industry is expressed in employment on the Sabbath, "seasonal" employment agreements, "loaning" players to other teams, and depositing deposits to ensure the players' wages; that the players' salary data it provided are not up-to-date; that there is no need to worry about broad repercussions for each sport a sports association that has enacted bylaws for it and the application in question relates only to the sport of football; that the Histadrut has equal votes to that of the Association and the administration in the committee for the examination of arbitrators; and that according to the provision of section 8(a) of the Regulations, the arbitrators are subject to the substantive law.

Summary of the Attorney General's position and the parties' responses

30. On May 31, 2022, the position of the Attorney General (hereinafter: "the Attorney General") was submitted, the main points of which are as follows:

The Attorney General is of the opinion that althoughthe Sports Law and case law grant the Association's internal judicial institution exclusive jurisdiction in matters related to activity in the industry, and although this authority has been interpreted extensively in case law, it does not extend to proceedings dealing with cogent rights - which should be clarified before the Labor Court.  This, in summary, is in light of the importance of protecting cogent rights; the public interest that the body that will hear them have the expertise to do so; considerations of ensuring access to the courts; and the reason that no distinction should be made between the types of players.  Just as no such distinction is made with regard to the cogent rights of "weakened" workers as opposed to "strong" workers in other sectors of the economy.