Gün + Partners
Gün + Partners is one of the largest law firms in Turkey. It provides a full range of legal services for local and international corporate clients. The firm has eight partners and over 70 lawyers. All lawyers work in Turkish and English and majority of them also offering fluency in German and French. The firm is based in Istanbul and has working offices in Ankara and Izmir.Show more
Arbitration & ADR
Mandatory mediation for commercial disputes was recently introduced by the Law on Legal Procedures to Initiate Proceedings for Monetary Receivables arising out of Subscription Agreements. As a result, an application for mediation is a condition for bringing a legal action before the courts, and a case will be dismissed on procedural grounds if the claimant in a commercial action fails to fulfil this obligation.
Employment & Benefits
The coronavirus pandemic will inevitably affect Turkish labour law; as part of employers' duty to protect employees, they must take occupational health and safety measures and protect employees' health and physical and mental integrity. This article outlines employers' duties in this respect.
At the beginning of each year, the minimum wage, severance payments and administrative fines prescribed by the Labour Act are revised. On 1 January 2020 the changes for 2020 came into effect. Among other changes, the monthly minimum wage rate has increased from TL2,558.40 (gross) to TL2,943.00 (gross).
The Constitutional Court recently found that the requirement for employers to pay interest at a rate of 5% for each day that a journalist's overtime payments remain outstanding conflicts with the Constitution. The court ruled that this requirement places an excessive burden on employers and may result in journalists' unjustified enrichment. Therefore, the court repealed the provision on the grounds that it breached the principles of proportionality and equality.
The Supreme Court General Assembly on the Unification of Judgments recently concluded that penalty clauses agreed for the unjust termination of a fixed-term employment contract before its end date are valid and enforceable even if the contract is deemed to be of an indefinite nature due to a lack of objective conditions required by law to conclude fixed-term contracts.
Applying for mediation was recently made a prerequisite when filing a lawsuit concerning monetary claims by employees or employers arising out of employment contracts, collective labour agreements or reinstatement claims. Mandatory mediation was introduced to accelerate legal proceedings and lower the costs in employment disputes.
The Supreme Court recently found that the failure of employees to use appropriate language in their written workplace correspondence with superiors or colleagues constitutes a valid reason for termination. The court held that although the actions of the employee in question had not been serious enough to constitute just cause for termination and deprive him of his termination benefits, the employer could not be expected to continue the employment relationship.
Minimum wage, severance payments and administrative fines prescribed by the Labour Act are revised at the beginning of each calendar year. The minimum wage rate was recently increased to TL2,558.40 (gross) and the maximum severance payment was increased to TL6,017.60 (gross). In addition, the rate of administrative fines was increased by 23.73% compared with 2018.
Effects of recently published presidential executive decree on salaries in or indexed to foreign currencyTurkey | 21 November 2018
The recently published Presidential Executive Decree 85 amended Decree 32 on the Protection of the Turkish Currency. In the field of employment law, it is unclear whether foreign nationals fall within the scope of the decree and how their salaries will be paid going forward. Since the decree uses the term 'Turkish residents', the general understanding is that it also applies to foreign employees, as they must have a residential address in Turkey in order to have a work permit.
The Supreme Court recently issued a number of decisions setting out how to calculate overtime pay and how employees can prove any overtime owed when required. Among other things, the decisions state that signed payslips can be used as material evidence. Further, where an employee has not signed a payslip and overtime payments have been made via bank transfer, the employee must prove that they worked the disputed overtime with documentary evidence.
The Supreme Court recently issued a decision concerning an employee's dismissal for borrowing money from their employer's customer. The Supreme Court reversed the first-instance labour court decision and ruled that the termination was lawful based on the fact that the employee had acted against the rule of integrity and honesty and damaged the employer's reputation.
The Labour Courts Act has introduced a number of changes and amended the appeal procedure for labour disputes. The legislature hopes to shorten the duration of actions which, by their nature, should be resolved as quickly as possible. Although it is still questionable whether these amendments will produce the anticipated returns in terms of reaching the desired duration for trial processes, they mark an important attempt to limit the two-phase appeal stage for certain cases.
The Amendment Act of August 25 2016 introduced the automatic enrolment of employees in private pension plans. As a result, employees under the age of 45 must be enrolled in a private pension plan as part of a pension agreement between their employer and a pension company. As the majority of employees have withdrawn from the system, the Ministry of Finance recently prepared a draft omnibus law which introduced new provisions regarding automatic enrolment in the private pension plan system.
Overtime in Turkey is regulated by the Labour Act and the Regulation on Overtime. Following criticism from legal scholars, the Regulation on Overtime was recently amended. The amendment has clarified that an employee's written consent for overtime can be obtained through an employment contract or during the employment relationship if needed. Therefore, obtaining employee consent at the beginning of each year is no longer required.
The Labour Courts Act, which was recently published in the Official Gazette, aims to ease the judiciary's workload and accelerate the judicial process in employment cases. The act has introduced a number of changes, the most important of which include mandatory mediation for employers and employees before initiating lawsuits, an amended procedure for reinstatement cases and a reduced statute of limitations of five years for several types of compensation.
The Supreme Court recently rendered an important decision concerning the protection of employees' privacy rights. The court reversed a first-instance labour court decision and ruled that the dismissal of an employee was unlawful on the grounds that the employer had used the employee's WhatsApp conversations (obtained in an impermissible way) as evidence, thus violating the employee's right to privacy.
The right of employees to annual paid leave is regulated by Articles 53 to 60 of the Labour Act and the Regulation on Annual Paid Leave. In principle, employees are expected to take their annual leave en bloc. Recent amendments to the act and the regulation maintain the right of employees to continuous rest, but provide flexibility to those who wish to divide their holidays into several parts in a given year.
The Supreme Court recently issued a decision concerning an employee's dismissal on the grounds of (among other things) recording a conversation with his supervisor without his consent. The court reversed a first-instance decision and ruled that the termination was lawful based on the fact that the employee had been handling personal business during working hours without authorisation and secretly recorded a conversation.
A long-awaited legal arrangement on employees' automatic enrolment in private pension plans by their employers was introduced into Turkish law by way of an amendment law published in 2016. The amendment law adds new provisions to the Private Pension Savings and Investment System Act 2001. Accordingly, employees under the age of 45 will be enrolled in a private pension plan with a pension agreement between the employer and a pension company.
The Ministry of Justice recently prepared a new draft Law on Labour Courts and shared it with the relevant public institutions and organisations for review. The draft law aims to ease the judiciary's workload and accelerate the judicial process in employment cases. The most important amendment stipulated in the draft law is the introduction of a mandatory mediation phase. If the draft law is adopted, it will be mandatory for employees to apply for mediation before initiating certain lawsuits.
Insolvency & Restructuring
The Law amending the Enforcement and Bankruptcy Law and Other Laws recently came into force. The most significant amendments introduced to the Enforcement and Bankruptcy Law are the abrogation of the postponement of bankruptcy procedure and the adoption of a more efficient and functional structure for the composition with creditors procedure, which is a court-approved agreement between debtors and creditors.
In a May 2019 decision, the Supreme Court General Assembly on the Unification of Judgments concluded that the plaintiff in a partial monetary action need not reiterate its claim for interest when increasing the value of the claim if it claimed interest for its principal receivables in the plaint petition and the claim of interest will automatically apply for the amount which is increased later on.
The Supreme Court recently examined the date on which an addressee had viewed an electronic notification. The court's first decision caused uncertainty as it accepted the date on which the notification had been viewed as the notification date. However, the court later revoked this decision and provided clear legal guidance that electronic notifications will be deemed to have been served by the end of the fifth day after their delivery, regardless of whether the addressee has viewed the notification.
The justification of court decisions is regarded as a key element of the right to a fair trial. In Turkey, this right is protected by the European Convention on Human Rights, as well as the Turkish Constitution, the Code of Civil Procedure and Supreme Court precedents. However, in practice, judgments are sometimes made without providing any justification as to why the parties' claims and evidence were not taken into account.
When the new Code of Civil Procedure was enacted in 2011, it introduced a new case type to Turkish litigation where plaintiffs file an action for receivables for an unquantified amount that is left to the courts to determine subject to dispute. This innovation in the litigation procedure raises questions regarding the instances in which plaintiffs should be deemed unable to calculate the size of their claims and what the courts should do when the receivables or damages are quantifiable.
Parties that failed to comply with an interim injunction or that violated an injunction previously faced one to six months' imprisonment. However, the Constitutional Court recently annulled this provision due to its lack of clear regulation and legal remedies. The changes will enter into force nine months after their publication in the Official Gazette and are final and binding on legislative, executive and judicial bodies, administrative authorities and real and legal entities.
Turkey has recently faced higher currency exchange rates, which has raised the question of whether this increase constitutes a change in circumstances that affects the fulfilment of contractual obligations. As there is no settled Supreme Court precedent regarding whether a fluctuation in currency exchange rates requires the adaptation of contracts, first-instance courts will need to examine the circumstances of each case.
Since 2012, individuals in Turkey have been able to make individual complaint applications to the Constitutional Court claiming that the state has violated their fundamental constitutional rights (or rights under the European Human Rights Convention) through its acts or omissions. One of the most common claims is that the state has violated an individual's right to a fair trial by failing to meet the reasonable time requirement and concluding criminal cases over long periods, in some cases more than 10 years.
Under Turkish law, there are two types of procedure in civil proceedings. Written procedure is the main and most common type, whereas the simple procedure, as the name suggests, is a simplified and expedited process. Following recent amendments, commercial cases worth less than TL100,000 are now subject to the simplified procedure in order to shorten the length of proceedings.
Preliminary injunctions in Turkey are regulated under the Code of Civil Procedure. A preliminary injunction can be requested from the competent court that has jurisdiction over a case prior to filing or the court before which a case is filed. Applicants must determine the grounds for making such a request in addition to the nature of the preliminary injunction being sought. They must also prove their claim to convince the court that the merits of the case are legitimate.
Article 5 of the Cheque Law imposes a judicial fine on cheque account owners for a bounced cheque. These fines cannot be less than the amount of the bounced cheque plus the accrued interest on the cheque's submission date and the total fees for execution and legal proceedings. Several courts recently applied to the Constitutional Court to request the annulment of Article 5 based on, among other things, the uncertain criteria used to calculate such fines.
Due to the need for the existing court procedural rules and organisational structure to be harmonised with the newly established three-tier court system, amendments have been made to the Code of Civil Procedure with the purpose of eliminating emergent problems in the functioning of regional appellate and administrative courts. The most remarkable amendment regards the period for appeal before the Court of Cassation.
The Regulation on the Determination and Enforcement of Target Investigation, Prosecution or Trial Periods was recently published in the Official Gazette. The regulation sets out the rules and procedures for determining the specific periods in which legal proceedings must be completed, thus ameliorating the judicial process. By establishing and adhering to time limits for legal proceedings, Turkey may be able to eliminate the delays in its judicial system.
If a foreign national who owns real estate in Turkey dies, his or her successors must have recourse to the Turkish courts and obtain a certificate of inheritance in order to complete the transfer of the real estate under their names before the land registry or be able to legally dispose of the property in any manner. A recent case illustrates that this issue can be overcome by the submission of specific documents issued by the competent authorities of foreign countries, testament or notary statements.
The court of peace recently appointed the former partner of a liquidated company as a gratuitous bailee to preserve the company's books. The decision created an alternative approach to the preservation of the books of liquidated companies, which must be preserved by a court of peace. The new approach should help to address concerns regarding the court's limited amount of storage space for company books.
A recent Court of Appeals case concerned a resolution taken at a general assembly meeting where the signature of the shareholder plaintiff's representative had been forged. As it was established without doubt that the signature on the general assembly meeting minutes did not belong to the plaintiff's representative, the court declared that the decisions taken at the general assembly were null and void.
In order for an invoice to generate a payment obligation on its recipient, Turkish law requires that there be an obligatory relationship between the drafter and recipient. A recent case confirmed that even when the recipient of an invoice does not object to it and inadvertently records it in its accounting books, this does not result in a payment obligation unless the invoice has a legal basis.
The recognition and enforcement of foreign judgments and arbitral awards in Turkey is subject to the International Private and Civil Procedure Law, under which enforcement actions must be filed before the civil courts of first instance, including certain specialised courts. The Court of Appeals has generally adopted a single approach regarding the jurisdiction of specialised courts in enforcement actions, but a recent decision has created uncertainty in that regard.
White Collar Crime
Computers, computer programs and records used by suspects are among the most important evidence for public prosecutors who carry out external investigations relating to white collar crime. There is no definition of 'electronic evidence' in Turkey, but Article 134 of the Code of Criminal Procedure sets out the procedure for searching, copying and seizing computers, computer programs and records. An amendment to Article 134 concerning the collection of electronic evidence procedures was recently published.