The new Labor Courts Law Nr. 7036 (“Law”), published in the Official Gazette dated 25 October 2017, brought important amendments that have been on the agenda for a long time. The recent amendments are as follows;
Mandatory Mediation Adopted as Cause of Action
- As of 1st January 2018, the parties (both employees and employers) shall be obliged to apply for mediation before they file a lawsuit before the Turkish Labor Courts with regards to employee or employer indemnity and compensation cases arising from employment agreements, collective bargaining agreements and re-employment cases.
- The lawsuits which are filed at the Labor courts without first applying to mandatory mediation will be rejected by the Courts due to the absence of cause of action.
- However, mediation shall not be deemed as cause of action in certain cases such as; material and immaterial compensation claims arising from i) occupational accidents ii) occupational diseases and iii) recourse actions in relation to these lawsuits.
Statute of Limitations
The statue of limitations for the disputes regarding annual leave fee and i) severance payment, ii) notice payment due to the termination of the employment contract without notice, iii) bad will compensation, and iv) compensation due to breach of equal treatment principle has been amended as five (5) years, regardless of the applicable law provided that it is arising from an employment agreement.
Mandatory Application to the Social Security Institution
Pursuant to the recent amendment provided by Article 4 of the Law; before filing a lawsuit, parties are obliged to apply to the Social Security Institution for the disputes arising from Social Security and General Health Insurance Code Nr. 5510 and the other relevant social security legislation, except for demands regarding the determination of compulsory insurance periods under employment agreements.
Application to Legal Remedies (Appeal)
The period for application to the legal remedies commence upon the official receipt of the court decision by the parties. Provisions of the Civil Procedural Law No. 6100 shall be applicable with regards to the labor court decisions as well.
Court decisions rendered before the enactment of the Law shall be subject to the provisions on legal remedies which were in force at the date of the court decision.
One of the most important amendments provided by the Law is the restrictions on certain cases with regards to the appeal remedy at the High Court of Appeals. The decisions of the Regional Court of Appeals shall be final and binding with regards to the following disputes and cannot be appealed at the High Court of Appeals:
- Decisions with regards to re-employment lawsuits filed in accordance with Article 20 of the Labor Law.
- Decisions with regards to the annulment of the disciplinary punishments imposed by the employers pertaining from work-place regulations or collective bargaining agreements
- Following lawsuits arising from the Law on Unions and Collective Bargaining Agreements:
- Lawsuits in relation to the termination of the employment agreement of the Workplace Union Representative,
- Lawsuits arising from the disputes on type of workplace in cases which a Workplace Collective Bargaining Agreement exists,
- Lawsuits on the interpretation of Collective Bargaining Agreements,
- Lawsuits on determination of legality of strikes or lock-outs,
- Following lawsuits arising from the Public Servants Unions and Collective Bargaining Agreements,
- Lawsuits to be filed against Union General Assembly meetings,
- Lawsuits in relation to the objection to denial of Union membership.
The new amendments of the Law with regards to mandatory mediation will come into force on the 1st January 2018. Other provisions have already come into force on 25th October 2017.
As a Conclusion
The most significant amendment provided by the Law is the mandatory mediation. Accordingly, lawsuits which are
filed without first applying to mandatory mediation will be rejected due to absence of cause of action. The other important amendment provided by the new Law is the change in the statute of limitations. The statute of limitations for the disputes pertaining from severance payment, notice payment, bad will compensation, compensation arising from breach of equal treatment and the annual leave has been amended as 5 (five) years, which used to be 10 (ten) years. Moreover, appeal remedy for certain court decisions at the High Court of Appeals (Yargıtay) level has been restricted and the decisions granted by the Regional Courts of Appeals have been accepted as final decisions in such cases.