The Draft Law Amending the Labor Law and Turkish Labor Institution ("Draft Law") has been accepted by the Grand National Assembly of Turkey Commission of Health, Family, Employment and Social Affairs, was approved by the Prime Ministry on 08.02.2016. It is envisaged that the Draft Law that was prepared as a reflection of the European Union's harmonization period, shall be enacted in the near future. The Draft Law governs the role of private employment agencies in establishing temporary employment relationships, which was an issue that lacked a basis in law. The Draft Law includes the definition and scope of temporary employment relationships and, thus, aims to fill the current legal loophole. This newsletter article examines the provisions and aims of the Draft Law in question.
The Concept of "Secured Flexibility" and European Union Regulations
A temporary employment relationship is a tool for employers in dealing with the fluctuations in workforce and production demands, and is a utility to increase staffing opportunities for employees. Therefore, a temporary employment relationship is an inevitable alternative in today's business world. Private employment agencies addressing such needs have a significant role in the harmonization of market conditions and solutions for the unemployment problem. However, the lack of legal provisions on such matter may give rise to detrimental consequences on working conditions and employee rights.
In order to prevent such detrimental consequences, as a result of European Commission studies that were held in 2008, European Union Directive number 2008/104/EC ("Directive") was published on 19.11.2008. This Directive is the first regulation designating certain standards for temporary employment relationships. The main aim of the Directive is to introduce minimum provisions in order to protect the rights of the employees who are employed within the scope of temporary employment relationships, and to ensure the facilitation of equal treatment to such employees.
In our country, intermediation activities in the private sector in finding jobs for employees, which were previously banned, were enabled as per Labor Law numbered 4857 ("Labor Law") and Turkish Labor Institution Law numbered 4094 ("Labor Institution Law"). On the other hand, the intermediation activities in the private sector to establish temporary employment relationships were not allowed. This issue was on the agenda during the drafting of the Labor Law. Actually, since the issue was stated in ILO Contract numbered 181 as an alternative employment method, the science commission that drafted the Labor Law initially included the occupational leasing method in the text of the draft as the 93rd article. However, due to the heated debates that it caused among the labor unions, this article was removed from the draft text of the Labor Law.
The main goal of the Draft Law is to allow private employment agencies to intermediate in the establishment of temporary employment relationships. As a matter of fact, the lack of legal basis for such intermediation activities of the private employment agencies has given rise to the loss of rights of employees who are currently working under such model. As mentioned in the preamble of the Draft Law, the fundamental aim of such Draft Law is to increase the flexibility and employability of the current workforce and, as result, to provide efficiency in employment services. In summary, the target is to establish a balance of flexibility-security in the workforce market, which currently consists of either registered employees having job security, yet lacking flexibility, and unregistered employees having flexible employment regimes, but who lack job security. Moreover, it is also targeted to make all players of the workforce market adopt the concept of "flexible security."
Establishment of Temporary Employment Relationships via Private Employment Agencies
Article 7 of the Labor Law includes the definition of temporary employment relationships. Article 1 of the Draft Law expands such definition, and grants private employment agencies the authority to establish temporary employment relationships, as well. In accordance with this provision, temporary employment relationships shall be installed via two written agreements of "employment agreement" and "temporary employee procurement agreement" to be concluded, respectively, with the temporary employee and the employer. Along with this provision, the private employment agencies shall function as a bridge between temporary employees and employers via two different agreements. The first paragraph of the same provision provides for cases in which temporary employment relationships are allowed. As per such provision, temporary employment relationships may be established in cases of:
- Enjoyment of maternity leave or the right to work part-time after giving birth, rendering of military service, or suspension of employment agreement due to any other reason,
- Seasonal agricultural labor,
- Home services,
- Periodic employment which is not considered as daily business of the enterprise,
- Employment that is deemed to be urgent in relation to job security or emergence of force majeure that considerably affects production,
- Significant increase of work load of the enterprise,
- Seasonal increase of employment.
In addition, temporary employment relations have been banned in workplaces that are going through collective redundancy, state institutions and organizations, and workplaces that are active in underground mining operations.
The temporary employee procurement agreement to be concluded between the private employment agency and the employer shall remain valid throughout the duration of the cases that are set forth under subparagraph (a) above, for an indefinite term for the cases set forth under subparagraphs (b) and (c), and for a term up to four months for those cases set forth under the other subparagraphs. This agreement shall only be renewed twice for periods that shall not exceed eight months in total, excluding the cases of significant increases of workloads. In accordance with the preamble of the Draft Law, the aim of the time limitation of certain temporary employment relationships is to avoid adverse effects on the regular operation of the workforce market, and to encourage a system in which temporary employment relationships are only used in circumstances where they are genuinely needed.
As per the eleventh subparagraph of the same provision, if the temporary employment relationships continue in force after their expiration dates, provided that the circumstance allowing such relationship still exists, an employment agreement with an indefinite period shall be deemed to be established between the employee and the employer.
Authority of Private Employment Agencies to Establish Temporary Employment Relationship
Article 5 of the Draft Law amends Article 17 of the Labor Law that governs private employment agencies. This provision of the Draft Law regulates the principles of authorization and permits real and legal persons to apply to operate as a private employment agency. In addition, such article also enables some eligible private employment agencies to open a branch and to put their system or brand into use.
As it is stated, above, another novelty concerns the authority to establish a temporary employment relationship. Certain qualified private employment agencies operating for an uninterrupted period of two years may be granted authorization to establish temporary employment relationships by the Turkish Employment Institution. This authorization is for a period of three years, and such period may be renewed for periods of three years, provided that such renewal is requested at least fifteen days prior to the expiration date.
Article 8 of the Draft Law envisages administrative fines for unauthorized private employment agencies intermediating the establishment of temporary employment relationships without permission.
Rights and Obligations of Private Employment Agencies
Article 19 of the Employment Institution Law has been amended by Article 7 of the Draft Law. In accordance with the preamble of the Draft Law, mandatory obligations and acts to be avoided by private employment agencies within the scope of their temporary employment relationship intermediation activities are regulated in order for them to duly operate.
As per the first paragraph of such provision, private employment agencies shall not be able to profit from job seekers in order to protect and avoid exploitation of such persons' rights. According to the same subparagraph, the addressee of the remuneration for intermediation services shall be the concerned employer.
In accordance with the second subparagraph of the Article, the employee in the temporary employment relationship shall be the private employment agency. Within this context, private employment agencies shall be obliged to acknowledge and provide the employee in question his/her right to remunerate based upon the equivalent employee. In addition, the private employment agency shall also be responsible to pay the social security premiums of the employee.
Article 2 of the Draft Law amends the title of Article 14 of the Labor Law as "On-call working and telecommuting," and defines the concept of telecommuting. According to such definition, telecommuting is a "written employment relationship in which the employee performs his/her service at home or out of office via telecommunication devices, within the work organization created by the employer." The same provision includes the minimum content of telecommuting employment agreements, and ensures equal treatment for employees working within the telecommuting model.
Since it forms the legal basis for intermediation activities of private employment agencies, thereby intending to protect employees losing their rights or forced to be employed unregistered, the Draft Law is considered as a positive development. On the other hand, the Draft Law shall furnish the private employment agencies with an authority that they did not have before. Within this context, the relations between employees, employers and private employment agencies should be handled quite delicately, and effective protection of the employees' rights against private employment agencies' authorities should be effectively safeguarded.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.