Circular on Social Security Institution Administrative Fines for Subcontractors has been published
Circular Publication Date: August 13, 2024
Summary
For employers to benefit from the five-point discount on the employer's share for the disability, old-age and death insurance premiums, the subcontractors should not have any outstanding insurance premiums, unemployment insurance premiums, administrative fines and related late payment penalty and late payment increase debts to the Insurance Security Institution ("Institution"). The circular ("Circular") dated August 13, 2024, numbered 2024/11, on the Amendment to Circular No. 2008/93 by the Presidency of the Institution, removed this condition in terms of administrative fines and their subsidiaries in accordance with the Council of State Decision dated June 11, 2024 and numbered 2024/2504 ("Decision").
Important Details
- Prior to the Decision, the principal employer could not benefit from the fivepoint discount on the employer's share for the disability, old-age and death insurance premiums due to the fact that the subcontractor who received work from the employer had a due debt to the Institution, and the principal employer was responsible for this debt together with the subcontractor.
- Following the Decision, if the subcontractor has an administrative fine liability to the Institution, the principal employer will be able to benefit from the five-point discount on the premium rate for disability, old-age and death insurances, as this debt is not considered to be the responsibility of the principal employer within the scope of this discount.
- With the Circular, Circular No. 2008/93 has been amended accordingly.
Council of State Decision on the Annulment of the Insurance Exemption Cap on Meal Cards
Decision Publication Date: May 8, 2024
Summary
With Decision No. 2023/170 and 2024/1853 of the 10th Chamber of the Council of State ("Decision"), Articles 2.1.2 and 2.1.4 of Circular No. 2022/22 on "Meal Fees" ("Circular"), which defined the meal exemptions and removed the payments made to meal cards from the category of benefits in kind, were annulled.
Important Details
- Pursuant to Article 2.1.2 of the Circular, if employers make payments in cash to third parties for insured employees, in return for invoices, the amount to be found as a result of multiplying 23.65% of the daily gross minimum salary by the number of days actually worked is not taken into account in the premium-based earnings.
- Pursuant to Article 2.1.4 of the Circular, in the event that the employers make payments for meal vouchers, meal cards, meal tickets, etc. to third parties for the insured, in return for invoices, the amount calculated by multiplying 23.65% of the daily gross minimum salary by the number of days actually worked is not taken into account in the premium-based earnings.
- The aforementioned provisions were canceled with the Decision. Accordingly, the exemption upper limit that applied to meal cards has been removed.
- As in the previous regulation, in the event that meal benefits are provided through meal cards, these benefits will be considered as "benefits in kind" and the insurance exemption limit will not be taken into considered.
- However, it is recommended to continue with the current practice until any secondary legislation on this regulation is issued.
General Letter on "No Debt Certificates to be issued in accordance with Public Procurement Law No. 4734" has been published
General Letter Publication Date: September 27, 2024
Summary
With the Communiqué Amending the General Communiqué on Public Procurement ("Communiqué"), the issues to be taken as the basis in determining the finalized social security premium debt were amended. The General Directorate of Insurance Premiums published a general letter ("General Letter") on "No Debt Certificates to be issued in accordance with the Public Procurement Law No. 4734" on September 27, 2024, where the implementation principles of the relevant amendment are explained.
Important Details
- The amendment introduced by the Communiqué entered into force on October 1, 2024.
- According to the General Letter, for a certificate of no debt to be issued to the employer for the requests on the date of entry into force of the Communiqué and the following dates, the total social security premium debt must be TRY 5,000 or below, as, in this case, the debt will not be considered as finalized social security premium debt.
- The debt items to be taken into account together in the calculation of finalized social security premium debt are the employer's debts, the employer's debts if the employer is a subcontractor in the workplace of another employer, and the employer's debts in case the employer has a subcontractor
Constitutional Court Decision on Violation of Freedom of Expression
Decision Publication Date: September 16, 2024
Summary
In its decision dated May 2, 2024, numbered 2020/38733 and published in the Official Gazette dated September 16, 2024 and numbered 32664 ("Decision"), the Constitutional Court ruled that the termination of the employment contract due to the remarks made in an email violated freedom of expression.
Important Details
- The former employee ("Applicant") sent an email to the email account of the managers and other employees at the workplace in response to the 5.3% annual raise she had been given, stating: "Hello, I am returning the rate of the raise given to me in an envelope to human resources. Whoever or whomever determined this rate should share it among themselves, for your information". Thereupon, the Applicant's employment contract was terminated.
- The Applicant filed a claim against the employer before the court of first instance for statutory seniority compensation and notice compensation, claiming that her employment contract had been wrongfully terminated. The court of first instance held that the Applicant's employment contract had been terminated with just cause, on the grounds that the email sent by the Applicant contained a veiled insult and that this could damage the honor and reputation of the employer and the employer's representatives who determined the rate of increase, and rejected the Applicant's claims. The 9th Civil Chamber of the Court of Cassation upheld the decision of the court of first instance.
- Upon the Applicant's individual application, the Constitutional Court evaluated the case in terms of freedom of expression.
- The Constitutional Court held that the first instance court (i) overlooked that the email sent by the Applicant could not be attributed to a specific person, (ii) did not evaluate how the email caused a negative impact on the workplace, and (iii) did not conduct a detailed examination, and, therefore, held that a fair balance could not be established between the reputation of the employer and the employer's representatives and the termination of the employment contract, and that the freedom of expression protected under Article 26 of the Constitution was violated.
- In the dissenting vote, it was stated that the court of first instance examined the relevant evidence and decided that the email sent by the Applicant constituted a veiled insult, that the court's decision was not arbitrary, that the relevant part of the email sent by the Applicant was sent to both the employer and the employees, humiliating the employer and the employer's representatives, and that the conditions for termination with just cause in accordance with Article 25, paragraph 2, subparagraph b of the Labor Law were met.
Decision of the Court of Cassation on the Applicability of the Law of the Habitual Place of Work to the Dispute Unless There is a More Strictly Related Law pursuant to Law No. 5718
Decision Publication Date: September 14, 2024
Summary
In its decision dated June 27, 2024, with file number 2024/767 and decision number 2024/10230, and published in the Official Gazette dated September 14, 2024 and numbered 32662, the 9th Civil Chamber of the Court of Cassation ("Court") ruled that where there is no choice of law agreement in disputes arising out of an employment contract, and where it is understood that the more closely related law is not Turkish law, the law of the habitual place of work will apply to the dispute.
Important Details
- The employee ("Plaintiff") claimed in the court of first instance that he worked in Nizhnekamsk, Tatarstan, between July 23, 2014 and January 19, 2015 and that his employment contract was wrongfully terminated without any notice. He further claimed the collection of the notice compensation from the Company ("Defendant") on the grounds that there was an organic link between ...... Şti. ("Foreign Company"), which was established under the laws of the Republic of Tatarstan of the Russian Federation, and the Defendant.
- The Defendant's attorney argued that the Plaintiff was an employee of the Foreign Company and that the Defendant had a completely separate legal entity from the Foreign Company and, therefore, the lawsuit should be dismissed. The attorney also claimed that the Plaintiff's insurance premiums were paid in accordance with the laws of the country where the Plaintiff worked, and that the salary and working conditions claimed by the Plaintiff did not reflect the truth.
- The court of first instance decided to accept the lawsuit on the grounds that Turkish law should be applied to this dispute at the hand on the grounds, that there is an organic link between the Foreign Company and the Defendant and that the Defendant is the employer of the Plaintiff.
- The Ministry of Justice ("Ministry") appealed before the Court, arguing that in cases where there is no choice of law, the law of the habitual place of work should be applied unless there is a more closely related law in accordance with Law No. 5718. The Ministry requested that the decision of the court of first instance be reversed on appeal for the sake of law, stating that it is contrary to the procedure and the law.
- In this context, the Court stated that in cases where there is no choice of law in accordance with Law No. 5718 (or where there is a choice of law but it is not valid), the law of the habitual place of work should be applied to the dispute unless there is a more closely related law. According to the Court, the habitual place of work is the place of work where the work is predominantly performed in terms of time and content. Within the scope of the case, the Court determined that the more closely related law had not been established. In this respect, it was found erroneous not to apply the law of the habitual place of work to the dispute for the work period when it was understood that the more closely related law was not Turkish law.
Decision of the Court of Cassation on Receivables Arising from Collective Bargaining Agreements
Decision Publication Date: September 14, 2024
Summary
In its decision with file number 2024/8322 and decision number 2024/10578, published in the Official Gazette dated September 14, 2024 and numbered 32662, the 9th Civil Chamber of the Court of Cassation ("Court") ruled that the due date of the receivables arising from the collective bargaining agreement is the date specified in the agreement.
Important Details
- The plaintiff claimed that a collective bargaining agreement was signed between the defendant and the union of which the plaintiff was a member, which was stated to be in force between February 15, 2017 and February 14, 2020, and that the payments for 2017 and 2018 arising from this agreement were not made and, thus, demanded the collection of these receivables from the defendant.
- In the decision of the court of first instance, it was ruled that, statute of limitations for all the receivable items claimed, i.e., the payments for 2017 and 2018, had expired.
- The Ministry of Justice appealed before the Court and argued that the case should be decided on merit on the grounds that the receivables subject to the lawsuit became due on July 18, 2019 pursuant to the relevant provision in the collective bargaining agreement with the effective date between February 15, 2017 and February 14, 2020, and, therefore, the statute of limitations would start to operate on this date. Stating that the decision of the court of first instance was contrary to the procedure and the law, it requested that it be reversed on appeal for the sake of the law.
- In this context, the Court observed that, according to the relevant article of the collective bargaining agreement signed between the union of which the plaintiff was a member and the defendant on June 18, 2019 with an effective date between February 15, 2017 and February 14, 2020, the receivables subject to the dispute became due 1 month after the signing date, i.e., July 18, 2019. The Court ruled that it was erroneous for the court of first instance to reject the case on the grounds that the statute of limitations had expired without considering the due date of the receivables, and reversed this decision for the sake of the law on the grounds that it was contrary to the principles.
Constitutional Court's Decision on Union Executives
Decision Publication Date: September 16, 2024
Summary
In its decision dated March 28, 2024, numbered 2019/19836 and published in the Official Gazette dated September 16, 2024 and numbered 32664, the Constitutional Court found that the claim of the trade union executive ("Applicant"), who claimed that his freedom of association was violated due to the unlawful termination of his employment contract, was valid. In the decision, it was emphasized that the failure of the Regional Court of Appeal to provide an adequate justification for not granting the union executive the protection regulated under Article 24 of Law No. 6356 on the grounds that he was not the representative of the authorized union was incompatible with the positive obligations of the state.
Important Details
- The Applicant's employment contract was terminated by the employer for valid reasons under Article 18 of Labor Law No. 4857. The employer cited low demand for work as the reason for termination. However, the Applicant claimed that the termination had been made on union grounds and was unfair, and he demanded reinstatement and union compensation. He also argued that as a union executive, his employment contract could not be terminated for valid reasons.
- The court of first instance partially accepted the case and decided to reinstate the Applicant, to reject the claim for union compensation and to allow the Applicant to benefit from the protection provided to union representatives. The decision of the court of first instance was appealed, and the Regional Court of Appeal decided that the applicant should be reinstated, his claim for union compensation should be rejected and that he could not benefit from the protection provided to union representatives as he was not the representative of the authorized union.
- The Applicant filed an individual application, arguing that he was a substitute member of the executive board of the union and should benefit from the protection of Article 24 of Law No. 6356. He also argued that the termination of his employment contract was contrary to the freedom of association, the principle of equality and the right to a fair trial.
- The Constitutional Court considered the Regional Court of Appeal's assessment that the Applicant was a workplace union representative but not the representative of the authorized union as an irrelevant reasoning that was not in line with the concrete facts.
- In this context, the Constitution Court considered the Regional Court of Appeal's failure to provide sufficient and relevant justification as a violation of the positive obligations of the state and, consequently, of the freedom of association guaranteed by Article 51 of the Constitution.
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