network anchor and the agency a labor relationship or a cooperative relationship? Once the contract is terminated, who will own the platform account? How should the "breakup fee" of both parties be calculated? Recently, the Intermediate People's Court of Suzhou City, Jiangsu Province concluded a brokerage contract dispute case in accordance with the law. It determined that Xu, an Internet celebrity who terminated the contract early and changed jobs, should compensate the brokerage company for the loss of expected profits of 12,000 yuan.
The court found that at the end of 2020, Xu signed a three-year "Internet Celebrity Brokerage Cooperation Agreement" with a brokerage company in Suzhou, stipulating that the company would exclusively represent and operate all of Xu's performing arts business, including the planning of accounts on various platforms. Packaging, performance arrangements, agency signing and other business activities. According to the agreement, Xu's income consists of a fixed monthly salary of 9,000 yuan and a 10% commission on commercial activities. He must abide by the shooting time, work schedule and other arrangements designated and arranged by a brokerage company. After
was running for half a year, Xu’s account quickly gained popularity under the company’s operation. Xu gained popularity, and a brokerage company also realized profits from commercial activities through Xu. In June 2021, Xu proposed to resign on the grounds that the company failed to pay social security and provident funds for him, and signed contracts with other companies.
A brokerage company filed a lawsuit in court, requiring Xu to compensate for the losses caused to the company by his breach of contract and job-hopping, including the company's cultivation cost of 200,000 yuan, expected earnings of 120,000 yuan, and paid remuneration of 100,000 yuan, totaling 400,000 yuan. At the same time, The court is requested to order that the account operating rights of Xu’s related platforms belong to the company.
During the trial, Xu argued that the relationship between himself and the brokerage company was a labor relationship. The company did not pay social security and provident funds for him, which resulted in the termination of the labor relationship. There was no breach of contract on his part. The court of first instance ruled that the right to operate relevant platform accounts belongs to the brokerage company, and did not support the brokerage company’s claim for loss compensation. A brokerage company was dissatisfied and appealed to the Suzhou Intermediate People's Court.
The Suzhou Intermediate People's Court held that the focus of the dispute in this case is: whether Xu's contract signing with other companies outside the case violated the terms of the "Internet Celebrity Brokerage Cooperation Agreement" involved in the case; if Xu constitutes a breach of contract, how should his liability for breach of contract be determined? After the trial, the court held that the "Internet Celebrity Brokerage Cooperation Agreement" should be a comprehensive contract, which not only includes the attributes of the labor contract relationship between the two parties, but also includes the brokerage company's permission for the commercial operation, packaging, promotion and copyright use of Xu's online platform account. The content of rights and obligations beyond the labor relationship has the attributes of a civil contract relationship.
Although Xu claimed to terminate the labor relationship on the grounds that a brokerage company failed to pay him social security, etc., considering the balance and fairness of the rights and obligations of both parties in such a comprehensive contract, his right to terminate should be limited by the agreement. Xu signed contracts with other companies and engaged in corresponding live broadcasting activities before the agreement between the two parties was terminated. He violated the agreement and should bear liability for breach of contract.
Regarding how to determine the losses caused by Xu’s breach of contract, the court held that the training costs invested by the brokerage company were to enhance Xu’s public visibility and market value, which were vocational training expenses and had the attribute of labor rights, and the fixed wages paid had the attribute of zero labor remuneration. , so neither should be included in the company's losses. Considering that Xu’s benefit in the revenue sharing accounted for 10%, the brokerage company claimed that Xu’s total expected benefit loss during the remaining performance period was obviously too high. Taking into account various factors, it determined that Xu’s total expected benefit should be borne by Xu. 10% of the loss will compensate the brokerage company for a loss of 12,000 yuan.
Accordingly, the court made the above judgment.
Brokerage companies can be compensated for expected profit losses
Shen Junfang, president of the Fourth Civil Tribunal of Suzhou Intermediate People's Court (Suzhou Labor Court), said that compared with the traditional performing arts industry, the online anchor industry has greater flexibility and interactivity, and brokerage companies The “star-making” cycle and investment return cycle have also been shortened accordingly. In this case, the "Internet Celebrity Brokerage Cooperation Agreement" signed between the anchor and the company combines the attributes of the labor contract relationship and the rights and obligations beyond the labor relationship. The legal relationship between the two parties is increasingly showing a new dual attribute.
For this type of comprehensive contract, we must not only protect the rights and obligations of the network anchor's labor relationship, but also respect the equal and voluntary agreement of both parties on the rights and obligations of the civil contract, and advocate good faith and compliance with the contract.After all, the value of online anchors is closely related to their own popularity, influence, etc., and brokerage companies will inevitably need to make commercial investments and bear certain business risks in terms of initial training and visibility enhancement. If a network anchor who has entered into a comprehensive contract with a network anchor service company is given the right to unilaterally terminate at will without liability for breach of contract, it violates the principle of good faith and will undermine the rights enjoyed by network anchor service companies and network anchors in such comprehensive contracts. The unbalanced relationship between obligations is not conducive to the healthy and standardized development of the overall operating order of the online live broadcast industry. The
case involves the "Internet Celebrity Brokerage Cooperation Agreement" as a comprehensive contract. The above-mentioned agreement's provisions on rescission and termination and liability for breach of contract are contractually binding on both parties. Xu's exercise of the right to terminate under the labor rights and obligations shall be subject to the restrictions and restrictions on the termination and liability for breach of contract in the agreement. Xu signed a contract with a party outside the case and engaged in corresponding live broadcasting activities before the agreement between the two parties was terminated, which constituted a breach of contract and should bear liability for breach of contract accordingly.
Regarding the calculation of losses due to breach of contract, the contract should be respected and fairness taken into consideration. The brokerage company involved in the case claimed that it is reasonable to use the income from relevant commercial activities during the anchor's performance period as the basis for calculating the expected benefits during the remaining contract performance period. In this case, the burden of proof of the income from relevant commercial activities during the performance period of the network anchor should be assigned to the brokerage company, and a quantifiable reference value range of losses should be determined based on the relevant facts provided by the brokerage company and the agreement between the parties, and within this reference value range Reasonable discretion shall be exercised within.
In this case, in order to calculate the expected profit loss of the brokerage company involved in the remaining contract performance period, a refined calculation formula was determined, that is, the commercial benefits obtained during the contract performance period ÷ contract performance period × remaining contract performance period × network anchor share The revenue ratio provides a quantifiable calculation method for similar cases of a brokerage company's expected profit loss due to network anchors switching jobs.
Author｜Rule of Law Daily All-Media Reporter Rosasha Correspondent Liang Tian Ai Jiajing
Source｜Rule of Law Daily
Editor｜Han Yuting Zhu Chanchan Yue Rui
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