LABOR LAW NEWSLETTER 2024/3

1.LEGISLATIVE AMENDMENTS

• The Ministry of Treasury and Finance General Directorate of Public Financial Management and Transformation determined the severance pay ceiling that will be valid between 01.07.2024- 31.12.2024.

With the Circular No: 5 dated 05.07.2024 and numbered 27998389-010.06.02-3248709 published by the Ministry of Treasury and Finance General Directorate of Public Financial Management and Transformation, it was announced that the severance pay ceiling will be 41,828.42-TL between 01.07.2024 – 31.12.2024.

• Turkish Employment Agency’s Circular on Short-Term Working has been published.

The Circular No. 2024/04 dated July 16, 2024 issued by the Turkish Employment Agency addresses the procedures and principles regarding the implementation of short-time working within the scope of Additional Article 2 of the Unemployment Insurance Law No. 4447 and the Regulation on the Procedures and Principles Regarding Short-time Working and Short-time Working Allowance dated June 11, 2024.

The Circular introduces various regulations on the conditions of short-time working, short-time working applications, payment and restrictions, duration and monitoring of short-time working, termination of short-time working, objections and audits. Some important regulations are as follows:

• The short-time working period shall not be less than four weeks and shall not exceed three months.
• The President is authorized to extend the short-time working period up to six months.
• Short-time working cannot be applied in the workplace for more than three months for the same reason without an extension decision taken by the President.
• The start date of short-time working for each insured may be determined differently.
• In order for the insured to benefit from short-time working allowance;
• The employer’s short-time working request is approved
• The insured must have been subject to a service contract for the last 120 days prior to the start date of short-time working and must have worked as an insured for at least 450 days in the last three years and paid unemployment insurance premiums.
• The daily amount of short-time working allowance is 60% of the average daily gross earnings of the insured calculated by taking into account the premium earnings of the last twelve months.

The circular was published on 16.07.2024 and it is stated that it will enter into force on the date of its publication, effective from 01/03/2024.

You can access the circular via this link.

• The Social Security Institution’s General Directorate of Insurance Premiums issued a Circular dated August 13, 2024, numbered 2024/11, titled “Amendment to Circular No. 2008/93”.

In order for the employers specified in section 9 of the Circular No. 2008/93 of the Social Security Institution to benefit from the five-point reduction in the employer’s share of disability, old age and death insurance premium rate, the statement “administrative fines and ancillaries” in the article that he and his sub-employers should not have insurance premium, unemployment insurance premium, administrative fine and delay penalty and delay increase debt related to them With the Decision dated 11.06.2024 and numbered 2020/2727 E. 2024/2504 K.

The fact that sub-employers have an administrative fine within the scope of the Council of State’s cancellation decision described above will not prevent the principal employer from benefiting from the five-point insurance premium discount.

You can access the relevant circular through the list of legislation available on the official website of the Social Security Institution.

• The Regulation on the Procedures and Principles Regarding the Implementation of the Workforce Adaptation Program has been published by the Turkish Employment Agency (“İŞKUR”)!

The Turkish Employment Agency (“İŞKUR”) published the Regulation on the Procedures and Principles Regarding the Implementation of the Workforce Adaptation Program (“Regulation”) in the Official Gazette No. 32647 dated 29 August 2024. This regulation outlines the conditions for the implementation of the program, which is carried out in cooperation with public institutions to increase the employability of the unemployed.

The Regulation, the procedures and principles regarding the execution of the Workforce Adaptation Program (WPP) have been regulated and it has been aimed to increase the employability of the unemployed. This employment covers various areas from disabled, elderly and sick to childcare and agricultural and livestock activities. Within the scope of the employment program, there are also areas such as the protection of the environment and public spaces, and the support of sports and cultural activities.

There are various conditions to participate in the program created by İŞKUR. Persons participating in the program must be citizens of the Republic of Türkiye, registered with İŞKUR, over the age of 18, not receiving pension or disability allowance, and not working as an insured within the last month.

It was aimed that the participants would work 37.5 hours per week in the first week of the program and 22.5 hours per week in the following weeks. It has been determined that the training period will not exceed 10 months in total by using a maximum of 140 days for each participant. Within the scope of the program, the participants will be paid pocket money not exceeding the daily minimum wage, and the social security premiums will be covered by the contractor according to the days of participation in the program.

Although the program provides participants with various trainings such as occupational health and safety, job search skills, motivation, stress management, there is an obligation to attend the program during the program. In the regulation, it has also been determined that a number of sanctions can be imposed if the obligations related to the program are not fulfilled.

As a result, important steps have been taken by İŞKUR to employ unemployed people. The said program can be applied through e-Government, AlO 170 and other platforms of İŞKUR.

You can access the Regulation published in the Official Gazette dated 29.08.2024 and numbered 32647 here.

• According to Circular No. 12 titled “Termination Notice” issued by the Union of Turkish Notaries on 02.09.2024, notification letters concerning termination for just cause under Articles 24 and 25 of the Turkish Labor Law No. 4857 are now subject to proportional stamp tax.

Under the Turkish Labor Law No. 4857, an employment contract may be terminated by either the employee or the employer for various reasons, regardless of whether the employment term is fixed or indefinite. A crucial aspect of such termination is that the reason for termination must be clearly communicated to the other party. In Turkish labor law, notifying the employee or employer of the termination carries several legal consequences, and proving that such notification has been made is of utmost importance. Therefore, to ensure legal security and prevent disputes, termination processes between employees and employers are documented through notarial channels to align with the law, ensuring document security and providing concrete evidence.

In the previous applications of the Notaries Union of Türkiye, while no stamp tax was collected in the terminations made by the worker or the employer through the notary public for just cause, a relative stamp tax was started to be collected from these notifications in accordance with the Circular of the Notaries Union of Türkiye dated 02.09.2024 and numbered 12 titled “Termination Letter”.

Stamp duty is a type of tax paid during the issuance or use of various documents, and this tax is collected in the use or issuance of certain papers such as some official documents, contracts, title deeds, invoices, bills, bonds, checks. Stamp duty is paid by calculating at certain rates according to the value of the transaction or the nature of the document. Which documents and transactions will be subject to stamp tax and the rate of stamp tax to be collected are clearly stated in the Stamp Tax Law No. 488.

“Papers subject to stamp tax” are shown in the table (1) attached to the Stamp Tax Law No. 488 and in paragraph I/A-5 of the relevant table; 5. Termination Letters (including those on a paper containing a certain amount of money) Various correspondences have been made between the Notaries Association of Türkiye and the Revenue Administration regarding whether the termination notifications to be made by the employee or the employer are included in the “Termination Letters” section in this table, and as a result, it has been stated that the notices to be sent by the employee or the employer that the employment contract has been terminated with a justified reason should be considered as a termination letter and a stamp tax of 1.89 per thousand should be collected from these papers, and a relative fee should be collected when approval is made on these notices.

Within the framework of the opinion of the Revenue Administration on the receipt of stamp tax from the notice of termination; From the notices to be sent by the Turkish Notaries Association that the employment contract has been terminated by the worker or employer for just cause, the application of stamp tax at the rate of 1.89 per thousand has been officially switched. Although there is no clear information about the price at which the stamp tax will be collected in the circular published on the official website of the Notaries Association of Türkiye, it is seen that the wage on the payroll of the employee is taken as a basis in practice.

You can access the full text of Circular No. 12 titled “Termination Notice,” dated 02.09.2024, on the Union of Turkish Notaries’ official website via this link.

2. JUDICIAL DECISIONS

• Equity Discount on Annual Leave Pay: Decision of the 9th Civil Chamber of the Court of Cassation Docket No. 2024/6366, Decision No. 2024/9427, dated 04.06.2024

In its decision dated 04.06.2024, Docket No. 2024/6366, Decision No. 2024/9427, the 9th Civil Chamber of the Court of Cassation ruled that an equitable deduction could be made from the annual leave compensation awarded in favor of the plaintiff, who had served in a senior executive position for many years. The plaintiff, who had the authority to issue annual leave certificates, claimed that he/she did not remember how much leave she/he had taken but indicated that he had combined his/her annual leave with public holidays.

As a result, although the decision will not constitute a precedent in terms of all files, it is also emphasized that a fairness reduction can be made by evaluating concrete events with the decision ruled by the Court of Cassation.

You can access our article analysing the full decision here.

• Contractual Provisions Increasing the Severance Pay Ceiling in Favor of the Employee Are Not Valid: Decision of the 9th Civil Chamber of the Court of Cassation Docket No. 2024/7068, Decision No. 2024/8676, dated 16.5.2024

The 9th Civil Chamber of the Court of Cassation, with its decision dated 16.5.2024 and Docket No. 2024/7068, Decision No.2024/8676, ruled that the provisions of the contract increasing the severance pay ceiling in favor of the employee are not valid in line with its previous case law.

The plaintiff party, who worked as a driver in the dispute subject to the Supreme Court examination, claimed that he was retired but his compensation was not paid according to the collective bargaining agreement and requested the collection of his labor receivables, including severance pay, and the defendant party put forward various defenses against the plaintiff’s claims, especially his defense that the retired plaintiff’s severance pay was paid in full, taking into account the ceiling according to the legal regulation.

Considering that the severance pay ceiling in terms of severance pay is absolutely mandatory by the Local Court, it was decided to reject the plaintiff’s severance pay request on the grounds that this compensation was also paid and there was no balance.

Against the decision of the Local Court, the plaintiff’s attorney argued that the regulation on severance pay has now become a relative mandatory provision, that the parties can decide otherwise, that the severance pay will be paid from the 60-day wage in the collective bargaining agreement between the parties, and that the work to be done by the Court should apply the provisions of the collective bargaining agreement.

As a result of the appeal examination made by the Regional Court of Justice over the file, it was emphasized that the severance pay ceiling was regulated in the law in terms of severance pay and that the provisions of the contract that increased or completely eliminated the ceiling, although for the benefit of the worker, were not valid, therefore, the plaintiff had no claim for the remaining severance pay on the grounds that the amount of severance pay determined according to the ceiling amount in force on the date of termination was paid to the plaintiff, and it was decided to reject the appeal application of the plaintiff party on the merits; the plaintiff’s attorney claimed the reasons specified in the appeal petition and applied for an appeal.

With the decision of the 9th Civil Chamber of the Court of Cassation dated 16.5.2024 and Docket No. 2024/7068, Decision No. 2024/8676, the decision of the Regional Court of Appeal was upheld, stating that it was not deemed to be of a nature that would require the decision to be reversed.

As a result, with the decision of the 9th Civil Chamber of the Court of Cassation, it is emphasized that the contract provisions that increase the severance pay ceiling in favor of the employee are not valid in line with the established case law.

You can access the full decision here.

• National Law Applicable to Disputes Regarding Employment Abroad: Decision of the 9th Civil Chamber of the Court of Cassation Docket No. 2024/7673, Decision No. 2024/10230, dated 27.06.2024

In the dispute subject to the review of the Court of Cassation, the plaintiff party working in Tatarstan/Nizhnekamsk in the position of Construction Mold Master claimed that the employment contract was terminated without notice without cause, that the wage was paid in USD, and that there was an organic connection between * Şti. and the defendant Company, and demanded to be ensured that she/he would receive notice compensation.

The defendant party argued that the plaintiff was not his own personnel, but the personnel of * Sti., which was established under the laws of the Republic of Tatarstan of the Russian Federation, that the two companies had separate legal entities, that the insurance premiums were paid in accordance with the laws of the country where the employee worked, and that the wage and mode of work claimed by the employee did not reflect the truth.

It was stated by the Local Court that the defendant party could not prove that the plaintiff’s employment contract was terminated in a way that could not be entitled to compensation, that the plaintiff was entitled to notice compensation, that the plaintiff’s witnesses made statements that the plaintiff worked within the defendant’s body abroad, that it was understood that the plaintiff worked abroad with the entry and exit records, that the plaintiff, who was a Turkish citizen, was assigned abroad by the defendant, that the plaintiff was employed in a company established abroad with the same partners and similar title, that the plaintiff was a Turkish citizen taking into account the public order, and that there was an organic connection between the defendant and the foreign company abroad, and that Turkish law should be applied to the concrete dispute and that the plaintiff should be accepted as the defendant’s personnel.

The Ministry of Justice requested that the ordinary workplace law should be applied when there is no more closely related law in accordance with the Law No. 5718 on Private International Law and Procedural Law “Law” in cases where the language of the contract is Russian, whether the plaintiff knows Russian is not understood from the scope of the file and therefore it is not binding for the plaintiff even if the choice of law is made, and the decision of the Local Court should be examined by appeal in the interest of the law, on the grounds that the common workplace law in the concrete case is Russian Law.

The 9th Civil Chamber of the Court of Cassation, in its decision (Docket No. 2024/7673, Decision No. 2024/10230, dated 27.06.2024), stated that;

• The language of the contract was Russian, but since it could not be proved whether the plaintiff knew Russian or not, even if the choice of law was made, it was not binding on the plaintiff, and in the absence of a choice of law, the law of the habitual place of business should be applied.

• The plaintiff worked in the Republic of Tatarstan of the Russian Federation during the working period between 23.07.2014-19.01.2015, the performance of the work undertaken by the plaintiff employee was performed within the borders of the country in question, and the habitual workplace is therefore the Republic of Tatarstan of the Russian Federation where the employee actually performed his/her work,

• When the file is examined, it is erroneous for the Local Court not to consider that the law of the habitual place of business should be applied within the scope of the dispute, which is understood that the more closely related law is not revealed, there is no choice of law agreement and the more closely related law is not Turkish Law, and to make a decision in this direction.

Therefore, it has been decided to overturn the decision in favour of the law with no effect on the result.  

As a result, the 9th Civil Chamber of the Court of Cassation once again emphasized that in employee-employer disputes, the law of the habitual place of work should apply unless there is a valid choice of law or a more closely related law.

You can access the full decision via this link.

• B**** B**** M**** A**** Ş**** Decision of the Constitutional Court of the Republic of Türkiye with Application No. 2020/19001

The Constitutional Court’s decision dated 08.02.2024 and numbered 2020/19001, published in the Official Gazette dated July 9, 2024 and numbered 32597, concerns the violation of the right of access to the court in the reemployment case.

In the concrete case subject to the application claiming that the right of access to the court was violated due to the lack of an open appeal remedy against the decision given in the reemployment case, the reemployment case against the applicant was decided to accept the case on 29.09.2017, the Regional Court of Appeal reversed the decision and sent the file to the local court, the local court decided again to accept the case on 24.01.2019, the Regional Court of Appeal examined the appeal request on 26.11.2019 and rejected it.

The applicant applied for an appeal, but his application was made in accordance with Article 8 and Provisional Article 1 of Law No. 7036 has been rejected on the grounds that no appeal will be made against the decisions regarding the reemployment cases made after 25.10.2017.

Therefore, the claims of the applicant, who claimed that his right of access to the court was prevented, were examined, and the Constitutional Court emphasized that the clear provision of the law and the applicant’s objections were examined on the merits at the appeal stage, and decided that the application was inadmissible on the grounds that it was clearly lacking in grounds.

You can access the full decision via this link.

• E**** E**** Decision of the Constitutional Court of the Republic of Türkiye with Application No. 2020/13187

The Constitutional Court’s decision dated 02.05.2024 and numbered 2020/13187, published in the Official Gazette dated July 18, 2024 and numbered 32605, concerns the application with the claim that the right to access to court was violated as a result of the reinstatement case being rejected due to the incorrect determination of the time period for filing a lawsuit.  In the concrete case, the two-week period that started following the issuance of the Mediation Non-Agreement Minutes coincided with the last day of Eid al-Adha, which is an official holiday, on 24.08.2024. The following dates 25.08.2018 and 26.08.2018 coincided with Saturday and Sunday, which are weekends. The lawsuit was filed on Monday, 27.08.2018, the first working day following these dates, and the Constitutional Court ruled that the local court and the Regional Court of Appeal decision that the reinstatement lawsuit was not filed within the time limit did not have a legal basis, and therefore the applicant’s right to access to court within the scope of the right to a fair trial was violated.

With this decision, it has been revealed that incorrect determination of the expiry date of the disqualifying period may cause a violation of the right to a fair trial.

You can access the full decision of the Constitutional Court via this link.

• The Constitutional Court’s decision dated 09.05.2024, numbered 2021/114 Docket and 2024/102 Decision, published in the Official Gazette dated July 24, 2024 and numbered 32611, paved the way for the award of bad faith compensation against the Social Security Institution.

As it is known, in the second sentence of the eighteenth paragraph of Article 88 of the Law No. 5510, it is stipulated that the compensation and penalties regulated in the Execution and Bankruptcy Law No. 2004 cannot be applied against the  Social Security Institution (“Institution”) Institution in the event that all kinds of lawsuits and enforcement proceedings to which the Institution is a party are concluded partially or completely against the Institution.

With the Constitutional Court Decision, it was decided that the stipulation that bad faith compensation cannot be awarded against the Institution would create inequality between the Institution and other persons who initiated enforcement proceedings, which is contrary to the principle of equality, and it was decided that the phrase “compensation” in the second sentence of the second sentence of the eighteenth paragraph of Article 88 of the Law No. 5510 is unconstitutional in terms of the second paragraph of Article 67 of the Execution and Bankruptcy Law No. 2004, which causes bad faith compensation not to be awarded against the Institution, and it was decided to be cancelled.

In line with this decision, bad faith compensation can also be awarded against the Institution against which a judgment has been rendered.

You can access the full decision of the Constitutional Court via this link.

• On July 26, 2024, some decisions of the 9th Civil Chamber of the Court of Cassation on reversal in favor of the law were published in the Official Gazette. You can access all the decisions summarized below via this link.

1. Decree of the 9th Civil Chamber of the Court of Cassation numbered 2024/3465 Docket and 2024/5084 Decision on the necessity of awarding an attorney fee in the separated case:

At the hearing of the lawsuit dated 06.10.2022, it was decided to separate the lawsuit for the week holiday, annual leave and national holiday general holiday wage receivables and to register it under a separate case. The separated case was procedurally dismissed due to the absence of the mediation requirement, and no attorney fee was awarded in favor of the defendant in this decision.

The 9th Civil Chamber of the Court of Cassation, noting that the separated case is a separate and independent case, and stating that the attorney’s fee, which is one of the costs of the proceedings, should be awarded separately in the case separated from the main case, it was decided to overturn the decision of the court of first instance, which did not award the attorney’s fee, in favor of the law.

With this decision, it has been revealed that the segregated cases should be considered as separate cases and the attorney’s fee should be ruled accordingly.

• Decree of the 9th Civil Chamber of the Court of Cassation numbered 2024/4245 Docket and 2024/5687 Decision that the termination of the employment contract due to marriage must be made on the date after the date of marriage:

The court of first instance awarded severance pay in favor of the female employee who terminated her employment contract due to marriage. In the concrete case, the female worker declared that she wanted to leave her job voluntarily on 26.01.2022 due to marriage with her petition dated 26.01.2022. Following this statement, the female worker got married on 28.01.2022.

In order for a female employee to terminate her employment contract due to marriage and be entitled to severance pay, this right must be exercised within one year from the date of marriage. In the concrete case, since the termination was made by the plaintiff two days before her marriage, the necessary conditions for her to be entitled to severance pay were not met, and the 9th Civil Chamber of the Court of Cassation decided to overturn the decision of the court of first instance in favor of the law.

• Decree of the 9th Civil Chamber of the Court of Cassation numbered 2024/5138 Docket and 2024/6724 Decision that the employee with 364 days of service is not entitled to severance pay and annual leave:

In the lawsuit filed with the claim for labor receivables, the plaintiff worked between 11.09.2020 – 11.09.2021 and terminated the employment contract with a justified reason. The local court has decided that the plaintiff must complete one year of service in order to be entitled to the said receivables.

The 9th Civil Chamber of the Court of Cassation determined that the plaintiff’s length of service was 364 days and decided to overturn the decision of the court of first instance in favor of the law. For the claimant to be entitled to the receivables in question, service period must be over one year.

• Decree of the 9th Civil Chamber of the Court of Cassation No. 2024/5595 Docket and 2024/8046 Decision stating that if the employment contract is terminated due to absenteeism because of the employee’s absence within the notice period following his/her resignation, the employment contract must be accepted as termination by resignation:

In the case subject to the lawsuit filed by the employer for notice pay, although the employee terminated the employment contract with notice, he/she left the workplace during the notice period, stating that he/she found another job. Thereupon, the employer sent a notice to the employee to return to work and work during the remaining notice period and notified that the employment contract was terminated for just cause due to absenteeism as the employee did not come to work without giving an excuse.

The court of first instance ruled that the employment contract was terminated by the employer and therefore no notice pay could be awarded in favor of the employer.

In the concrete case, the employment contract was terminated with notice by the employee, but the employee left the workplace within the notice period. In this case, the termination made by the employee should be considered irregular, and the employer’s subsequent termination notice due to absenteeism should not be taken into consideration. Considering that the employment contract was terminated by the employee, an evaluation should be made in terms of notice pay, while concluding that the employment contract was terminated by the employer and that the party who terminated the employment contract was not entitled to notice pay was erroneous and the decision of the court of first instance was reversed in favor of the law.

• M**** E*** Decision of the Constitutional Court of the Republic of Türkiye with Application No. 2022/58456

The Constitutional Court’s decision dated 18.04.2024 and numbered 2022/58456, published in the Official Gazette dated 31 July 2024 and numbered 32618, concerns the applicant’s application that his/her employment contract was terminated due to the words he/she used in his petition to object to the report issued regarding an occupational accident, which led to a violation of his/her freedom of expression.

The applicant objected to the inspection report prepared regarding an occupational accident at work. The statements in the petition of objection written by the applicant were cited as a reason for termination by the employer. The Constitutional Court ruled that the applicant’s petition of objection, rather than insulting and taunting, basically aimed to prove that he/she was not responsible by expressing his situation at the workplace and the measures taken / not taken by the employer for the fatal work accident, that the employer’s reputation was not damaged considering that the objection was not public, that the dismissal sanction imposed on the applicant was too severe considering the incident in question and that it was contrary to the principle of the last resort of termination, and that the applicant’s freedom of expression was violated for the reasons explained.

You can access the full decision of the Constitutional Court via this link.

• Employer’s Termination for Just Cause due to Employee Using Medical Leave for Vacation: Istanbul Regional Court of Appeal, 47th Civil Chamber, Docket No. 2021/3704 and Judgment No. 2024/1546, dated June 13, 2024

In the case before the Regional Court of Appeal, the plaintiff employee argued that his employment contract was terminated by the employer without just cause and without notice on the grounds that “he/she went on vacation and shared photos on social media on the dates he was on report”, that he/she did not go on vacation between 22.07.2019-26.07.2019 when he/she was on report, and that the photos he/she shared on social media were taken on another vacation he/she had previously been on, and submitted this lawsuit for severance and notice pay and labor receivables.

The defendant employer stated that the employee, who could not get permission from his manager due to intensity, took a medical report and went on vacation, that the plaintiff’s going on vacation despite taking a report clearly shook the bond of trust between the defendant company and the plaintiff, that it was not possible for the defendant to ensure the continuation of the plaintiff’s employment contract after this action of the plaintiff, that the plaintiff’s going on vacation contrary to the report during the period when the plaintiff was on report was contrary to integrity and loyalty, which was sufficient for justified termination, that it was learned that the plaintiff told his colleagues that he/she took a report because his/her annual leave request was not accepted and he/she was going on vacation, that it was determined that the plaintiff was on vacation in Alaçatı on the date of his/her report and that he/she published the vacation photos he/she took there, that the plaintiff’s employment contract was terminated for just cause in accordance with the decision of the disciplinary board due to the elimination of the trust relationship that should exist in the employment relationship due to his/her actions contrary to his/her integrity and loyalty.

In the statement of the defendant employer witness heard by the Regional Court of Appeal within the scope of the file; it was seen that the plaintiff requested to take annual leave, he/she was told that he/she could not be given leave due to the workload and that he/she could take leave on another date, then he/she said that he would report and leave, his/her defense was taken and he was dismissed, and another defendant witness confirmed these statements and stated that the plaintiff said that he/she would report and leave, that they asked for a defense from the plaintiff and that he/she was dismissed.

When the witness statements heard within the scope of the file and the characteristics of the concrete incident are evaluated together; the plaintiff was reported between 22/07/2019 and 26/07/2019, the plaintiff requested annual leave from the defendant employer for 22/07/2019-25/07/2019 before submitting his/her report to the workplace, and the defendant employer rejected the request for annual leave due to work intensity, When the situations that the plaintiff made social media posts that he was on vacation in Çeşme, which he/she declared as the place where he/she would request annual leave during the period when he/she was reported, that the plaintiff went on vacation and made posts on social media despite submitting a medical report to the workplace that he was unwell, and that he made a defense in his/her defense that his/her posts belonged to previous periods are evaluated together; it is understood that the behavior of the plaintiff in question is in the nature of behavior that does not comply with integrity and loyalty, the termination of the defendant employer is based on just cause, the plaintiff is not entitled to severance and notice compensation, the court’s determinations and evaluations to the contrary are not in accordance with the file content, and the appeal objection of the defendant’s attorney is appropriate. The Regional Court of Appeal lifted the court decision in this respect and ruled that the termination of the employment contract by the employer was justified and that the plaintiff was not entitled to severance and notice pay.

You can access the full decision via the link.

• Termination for Just Cause Due to Deviation from the Employer-Designated Route as Detected by the Vehicle Tracking System: Sakarya Regional Court of Appeal, 12th Civil Chamber’s Decision Dated 10.07.2024, Docket No. 2022/1843, Decision No. 2024/1502

In the case subject to the relevant decision of the Regional Court of Appeal, the plaintiff employee defended that he had been working as a driver for the same company for five years, that his/her work would be disrupted due to traffic density and that he used the route with less traffic density in order not to disrupt his/her work, but that he/she was forced to resign by the defendant employer, and that his/her employment contract was terminated unfairly and unlawfully, although he/she did not take any actions that would require any written or verbal defense.

The defendant employer, on the other hand, argued that the plaintiff was responsible for shipments within the city of Istanbul using company vehicles, and that the delivery routes were communicated to him prior to departure. During 2020, the employer experienced repeated delivery delays, and excessive mileage was recorded. Upon review of the GPS tracking system, it was discovered that the plaintiff had frequently deviated from the assigned routes and stopped at unapproved locations. For instance, a delivery trip that should have covered 160 km round-trip was recorded at 335 km, with unexplained stops. In another case, a route covering 18 km was registered at 19 km, and on a delivery dated August 19, 2020, the distance was extended by 88 km as the plaintiff deviated to Eyüp/Istanbul, outside the planned Tekirdağ route. The employer claimed that the plaintiff’s explanations did not match the GPS records, and despite prior warnings, the behaviour continued. Due to the risk posed by the plaintiff’s unexplained stops—raising concerns about potential illegal or unregistered loading—the employer terminated the contract for just cause, stating that the plaintiff was not entitled to severance or notice pay.

As a result of the examination of the GPS records subpoenaed to the file by the Sakarya Regional Court of Appeal and analysed by the expert, it was understood that the plaintiff went out of the route notified by the defendant employer many times, and the plaintiff could not explain the reason for the said off-route exits.

The plaintiff works as a driver in the field of goods transportation, the employer trusts the plaintiff and entrusts a large amount of goods to the plaintiff, there is a relationship based on trust between the defendant and the plaintiff, in this case, the plaintiff’s departures from the route, the reason for which the plaintiff cannot explain, is a breach of trust, considering the relationship between the parties and the work of the plaintiff, In this case, since it is understood that the defendant has proved the claim of justified termination within the scope of the file, it is concluded that it is not appropriate to decide to accept the severance and notice indemnity claims with written justification, while the severance and notice indemnity claims should be rejected, and the decision of the court of first instance was abolished and it was decided to reject the severance and notice indemnity claims.

You can access the full decision via the link.

3. GLOBAL TRENDS IN WORKING LIFE

• The New Working Order Brought by Technology: Platform Working!

With Industry 4.0, business life has also adapted to technological developments, and new ways of working have emerged, including platform working. In the platform working order, where communication is provided in the online environment and flexible and generally non-continuous work are carried out, the focus is on the concept of duty instead of the concepts of work or service.

In the platform working arrangement, there are three parties in the working relationship: customers, employees and intermediaries, as digital platforms mediate the services and activities between customers and service providers. In this scheme, which aims for customer-oriented production by utilizing digital platforms, employees and customers are matched through a specific application or website to perform certain tasks. The main characteristics of platform working are that the work is organized through platforms, there are three parties in the working relationship, the work is characterized as a task, the tasks are aimed at being fulfilled, and services are provided on demand.

More than 28 million people in the EU work through these digital platforms and there are around 500 digital labor platforms operating in the EU. A variety of tasks can be performed through digital platforms, both on-site and remotely, such as delivery, translation, babysitting, cleaning services, taxi driving, copywriting, short-term accommodation services, content review.

Digital work platforms are divided into two different groups by the International Labour Organization: web-based tasks and location-based tasks. Web-based tasks and location bases are also classified into two different categories: tasks assigned to selected individuals and tasks assigned to audiences. At this point, in the free market category, which is among the web-based tasks assigned to selected people, people work freely through freelance work platforms. Web-based tasks given to the masses include competitive creative tasks and micro-tasks. Location-based tasks given to selected people include activities such as accommodation, transportation, and home services, while location-based tasks given to the masses include local micro-tasks.

As a result, while platform work provides a new employment door for many people, it is becoming increasingly widespread with the spread of technology throughout the world. Although the gig economy, which is another working order that emerged with the advancement of technology, and freelance work and platform working order are similar in terms of completing a certain work, they differ from the relevant working order in many areas, especially the progress of the work to be done on the digital platform.

For this reason, each working order is unique, and you can review our previous article on the gig economy here.

• European Framework Agreement on Telework

The European Framework Agreement, which sets out the definition of telework and the basic rules for this way of working, was adopted by the European Social Dialogue Committee on 16 July 2002. This agreement aims to regulate teleworking practices between employers and employees across Europe by being implemented in accordance with local legislation.

The agreement emphasizes that teleworking is voluntary and links the employee’s transition from their current position to a teleworking position or vice versa to an agreement between the employer and the employee. Regulations on issues such as employment conditions of teleworkers, occupational health and safety, confidentiality, training, equipment supply and costs are also discussed within this framework. Teleworking offers flexibility to employees in terms of work-life balance and gives freedom in the choice of working hours and location. This way of working can increase the productivity of employees and reduce costs and contribute to environmental sustainability by reducing the need for transportation. In addition, flexible working conditions and a better work-life balance can reduce turnover rates by increasing employee satisfaction.

As a result, with the European Framework Agreement, it is aimed to create a working environment that provides flexibility and efficiency by protecting workers’ and employers’ rights by supporting the dissemination of telework.

The regulation, which entered into force on 1 July 2023, aims to modernize and strengthen the teleworking practices of the European Framework Agreement. This regulation aimed at a more widespread and effective implementation of teleworking by updating workers’ rights and employers’ responsibilities across the European Union.

In line with the regulation, employers are obliged to determine telework policies in writing and inform employees about these policies. In addition, issues such as the fact that teleworkers have equal rights with those working in the office, adapting health and safety standards to telework, increasing data security and regulating working hours are also mentioned in the regulation. While protecting the rights of employees, the regulation aims to clarify the responsibilities of employers, eliminate legal uncertainties and create a more balanced and sustainable structure in the European labor market.

The regulation, which entered into force on 1 July 2023, addressed the cross-border dimension of teleworking, clarifying which country’s social security legislation employees would be subject to. Teleworkers are generally subject to the social security rules of the country where the employer’s headquarters or workplace is located, but exceptions and coordination requirements may arise in cases where employees work in different countries. With the regulation, it is aimed to protect social security rights in these cases and to eliminate legal uncertainties by clarifying the obligations of employers. In this way, employers will be able to clearly fulfill their responsibilities while protecting the rights of teleworkers.

If the following conditions are met, the employee may request his/her employer to be subject to the social security legislation of the member state where his/her head office or workplace is located:

• The country of residence of the employee must not be the country where the employer’s headquarters or workplace is located.
• The employee must spend less than 50% of his/her working time in the country where he/she resides and most of his/her working time in the country where the employer is resident.

Accordingly, although employees can apply retrospectively for a maximum of 1 year between 1 July 2023 and 1 July 2024, a maximum of 3 months can be applied retrospectively as of 1 July 2024.

As a result, the regulation dated 1 July 2023 aims to prevent possible problems between employers and employees by clarifying which social security legislation teleworkers will be subject to.

• Türkiye joined the Equal Pay International Coalition (“EPIC”) on the sidelines of the G20 meetings in Brazil in July.

Chile and Türkiye have committed to join the Equal Pay International Coalition (“EPIC”). Thus, the number of countries that have signed up to the equal pay target for women and men by joining epic has increased to 27. In addition, Spain and Japan, which are already members of epic, have agreed to step up their efforts to close the gender pay gap. Epic member countries aim to end the gender pay gap under this umbrella by 2030 and are making efforts in this direction.

• Beginning July 1, 2024, New York employers are required to publish and distribute a Notice of Workers’ Rights informing employees of their rights under federal, state and local workplace laws. 

The Notice includes a QR code that directs employees to the Worker Bill of Rights webpage on the New York City Department of Consumer and Worker Protection’s website, which contains information about a number of important employment laws. These laws include, but are not limited to, Paid Safe and Sick Leave, Minimum Wage, Job Applicant Rights, Wage Transparency, and rights to automated employment decision tools. Employers must also provide this notice to new employees on or before the first day of employment.

Employers must notify in English and any language spoken as a primary language by at least five percent of their employees. Failure to comply with the notification and posting requirements will result in penalties for employers.

• The amendment to China’s Company Law, which came into force on July 1, 2024, strengthened worker representation in the management cadres of companies

According to an amendment to China’s Company Law, companies with more than 300 employees are required to have at least one employee representative on the board of directors if there is no employee representative on the supervisory board.

Companies in the People’s Republic of China have a two-tier board structure consisting of a board of directors and a supervisory board. The amendment guarantees worker representation in the top management of companies and gives workers a stronger voice in decisions that affect them, such as the development of company strategy and workplace policies.

• Fair Work Act has been amended in Australia in favor of workers. Accordingly, the amendment that entered into force on August 26, 2024 granted employees the “right to disconnect”.

Accordingly, employees will have the right to refuse to respond to their employer’s out-of-hours communication. The law does not prohibit the employer from calling the employee outside working hours, but only provides legal protection for the employee’s refusal to respond. The limit of this law is that the refusal to respond must be reasonable.  The law, which currently applies to medium and large companies, will be extended to small businesses by 2025.

Earlier in Australia, flexible working arrangements were expanded in line with the “Secure Jobs, Better Pay” policy as of June 6, 2023. These amendments expanded the circumstances in which employees can request flexible working, increased the employer’s obligation to consider an employee’s request for flexible working, and provided remedies for dispute resolution if the employer rejects an employee’s request for flexible working.

• The statutory Code of Practice on Dismissal and Re-engagement, which came into force in the UK on July 18, 2024, introduces new responsibilities for employers seeking to change the terms and conditions of contractual employment.

The Rules will apply in cases where the employer is considering changes to employees’ employment contracts, also known as ‘fire and rehire’, where the employer envisages that employees may be dismissed and rehired on terms that may be unfavorable to the employee if those changes are not accepted.

According to the regulation,

• Fire and rehire should only be used as a last resort.
• Employers will need to contact the Advisory, Conciliation and Arbitration Service “ACAS” at an early stage before telling their employees about dismissal and redeployment. (The Advisory, Conciliation and Arbitration Service is an organization that aims to improve organizations and working life through better employment relations by working with employers and employees to resolve problems and improve performance.)
• Employers will be expected to explore alternatives to fire and rehire
• Employers should consider feedback from employees and where proposed contractual changes are not accepted, they should be reviewed and, if necessary, renewed.
• Employers should not threaten dismissal unless dismissal is contemplated.
• Employers may not use the threat of dismissal to force employees to sign new terms and conditions of the employment contract.
• Employers can commit to review the changes in the future and reassess whether they are necessary. If more than one change is to be implemented, there will be an option to phase them in rather than implementing them all at the same time.

There will be no independent action for breach of the Code of Practice on Dismissal and Re-employment. The new rules will be considered by labor courts in relevant cases, including those arising from unfair termination. Courts are authorized to increase damages by up to 25% for breaches of these rules.

You can access the relevant text of the law via this link.

• Recent Developments in Irish Employment Law

Recently, there have been significant developments in Irish employment law, involving statutory changes concerning parental leave, redundancy, retirement, gender pay gap reporting, and work permits. The key changes affecting employers are as follows:

1. Amendments to the Parent’s Leave and Benefit Act 2019 (Act No. 35 of 2019):

Amendments to the Parent’s Leave and Benefit Act 2019 (Act No. 35 of 2019) came into effect on August 1, 2024. Prior to the changes on August 1, 2024, the right to 7 weeks of leave, which was granted to parents within 2 years from the birth of the child or the adoption of the child, was extended by 2 weeks to 9 weeks. Furthermore, it is now stipulated that employers may grant leave to employees beyond the statutorily defined period of unpaid parental leave.

The Minister for Social Protection in Ireland stated that extending the parental leave for both parents is part of a goal to ensure that parents can spend meaningful and quality time with their newborns or newly adopted children, with the assurance of financial support.

Parental leave can be taken by employees within two years of the child’s birth or adoption, and employees will be eligible for nine weeks of parental benefit from the Department of Social Protection, provided they meet the Pay Related Social Insurance (PRSI) contribution requirements.

In our previous bulletin, we discussed changes in the UK Employment Law under The Maternity Leave, Adoption Leave, and Shared Parental Leave (Amendment) Regulations 2024, which offer protection against dismissal for up to 18 months for employees on parental leave. Conversely, the amendments in the Irish Parent’s Leave and Benefit Act of 2019 focus on extending the duration of leave and the social benefits provided to parents. You can read our article on changes in UK Employment Law here.

• Changes to Redundancy Legislation:

The Employment (Collective Redundancies and Miscellaneous Provisions) and Companies (Amendment) Act 2024, which modifies Irish redundancy legislation, came into force on July 1, 2024. This Act repealed the exemption for collective redundancies in cases of employer insolvency and provided enhanced protections for workers. The new law amends the existing rules under the Protection of Employment Act 1977.

Previously, the Protection of Employment Act 1977 treated collective redundancies due to employer insolvency as an exception. However, the new legislation mandates that in all cases of collective redundancies, including those due to insolvency, employers must notify the Department of Enterprise, Trade and Employment of their intention to implement a redundancy at least 30 days in advance. This change also grants employees entitlement to compensation if they are dismissed before the 30-day notification period concludes. Moreover, redundancy notifications can now be made via email.

Key changes to the Protection of Employment Act 1977 regarding collective redundancy rules include:

• The exemption for notification requirements for redundancies due to employer insolvency has been removed. All collective redundancies, including those due to insolvency, are now subject to the 30-day notification period. Mass layoffs that does not comply with 30-day notice period will be considered void.
• Employees dismissed before the end of the 30-day notice period can seek redress through the Workplace Relations Commission (WRC). This applies to all forms of collective redundancies, not just those resulting from insolvency. Furthermore, if the employer neglects to engage in consultations with employee representatives or does not furnish the necessary information concerning collective redundancies, employees are entitled to file a complaint before the Workplace Relations Commission against the employer.
• The Act has been aligned with the Court of Justice of the European Union’s case law, ensuring that the obligations of employers in collective redundancy cases are met by liquidators or similar officials in cases of insolvency.
• Employers’ methods of notifying about planned collective redundancies have been updated, and it has been stipulated that they can also notify the relevant Department of Enterprise, Trade and Employment via email.

• Are We Turning Back to Working from The Office?

The COVID-19 pandemic, which quickly spread across the globe, had a profound impact on many industries, with the business world being one of the most affected areas. Since people needed to continue working to sustain their livelihoods, the pandemic did not bring work to a complete halt. Instead, alternative measures and new working methods were introduced, with remote work becoming mandatory in sectors where in-office presence was not required.

Although many companies had already adopted remote work prior to the pandemic, this working model became widely accepted worldwide as a measure to curb the spread of a disease transmitted through physical contact. It has now evolved into a lifestyle. Initially conceived as a temporary solution during the pandemic, remote work became permanent in many companies due to factors such as the prolonged nature of the pandemic, the cost benefits, and the improvement in employees’ work-life balance. For some employees, the ability to work remotely has become as important as salary in negotiations for new employment.

As remote work has become a way of life, numerous studies have explored its advantages and disadvantages. For example, a report published by the World Health Organization (WHO) and the International Labour Organization (ILO) titled Technical Brief on Healthy and Safe Teleworking examined the health impacts of remote work. The report highlights the positive aspects of remote work, such as better work-life balance, flexible working hours, increased physical activity, less time spent in traffic, and reduced air pollution in urban areas. However, it also acknowledges the potential negative impacts, including feelings of isolation, burnout, depression, eye strain, and unhealthy weight gain. From the employer’s perspective, remote work is evaluated in terms of employee productivity, sense of belonging, and the costs associated with in-office work.

In response to these considerations, several well-known global companies have started gradually calling their employees back to the office. For instance, a prominent social media company announced in November 2022 that all employees would be required to return to the office without exception. A major technology company, on the other hand, has required all of its employees to come to the office two days a week, while another social media company has mandated that all employees work in the office three days a week.

In the latest development, a renowned e-commerce company announced that, to strengthen its corporate culture, it would require employees to return to the office five days a week starting January 2, 2025.

In Türkiye, a CEO of one of the top 100 companies recently expressed doubts about the sustainability of remote and hybrid work models, citing concerns about company performance and employee loyalty. Similarly, the CEO of one of the largest textile companies in Türkiye stated that while the hybrid/remote work model saved time and costs related to commuting and meals, it also had drawbacks, noting a decline in productivity during remote work compared to when employees were physically present in the workplace.

There have also been significant court decisions in remote work. In a precedent-setting case, an employer had initially hired an employee under a French employment contract to work in France. Due to certain conditions—particularly the requirement to adhere to French working hours with a +/- 2-hour adjustment—the employer allowed the employee to work remotely from Canada, where the employee had gone before the COVID-19 pandemic but was unable to return. When the remote work period ended, the employer asked the employee to return to the office physically. Subsequently, the employer terminated the employee for “gross misconduct” due to the employee’s failure to return and the associated risks this posed to the employer.

The court found the employer’s termination for “gross misconduct” to be lawful. The rationale was that, in the absence of a work permit in the country where the employee was working abroad, the employer bears responsibility under GDPR for the employee’s activities. Since no technical and administrative measures were taken regarding cross-border data transfer and the employee did not have social security coverage, such as insurance for work-related accidents in the foreign country, the employer was exposed to additional risks. Other words, the court upheld the termination, reasoning that the employee posed risks to the employer, including issues related to GDPR compliance and social security coverage for workplace accidents, which were not adequately addressed while the employee worked remotely from abroad (Paris, 1/8/2024, no: 21/06451).

Looking at all these developments, it is evident that the idea of “returning to the office” is gaining momentum both globally and in Türkiye. At this stage, it appears that some companies are highlighting the negative aspects of remote working, and the remote working system is gradually being phased out.