Mandatory Mediation in Labor Disputes
The Reason Behind the Legislation
Since 1950, when the 5521 numbered Code of the Labor Courts had entered into force, the population in Turkey has increased rapidly, business life has changed and developed and, accordingly, the number of labor law disputes and types have increased. During this period of time, significant amendments have been made in the core legislation and regulations on the judicial principles of the civil courts. However, the legislation regulating the jurisdiction before the Labor Courts has not been within the scope of these amendments.
In Turkey, the judicial authorities failed to cope with labor law disputes within the desired period of time within which very high numbers in line with the high population and high numbers of employees were recorded. The disputes arising from the labor law take an important place in the agenda of the jurisdiction. Approximately 15% of legal disputes before the first instance courts, and approximately 30% of the legal disputes before the Supreme Court are labor law originated.
In recent years, alternative dispute resolution methods have arisen and are preferred by involved parties. Mediation, as a leading dispute resolution form, has been a successful method since the practice of the same in Turkey, and it serves the parties in reaching an amicable settlement without the need of resorting to the judicial authorities. Statistics show that 89% of the civil disputes brought to the mediators are labor law originated and approximately 93% of these disputes are concluded with settlements. In general, 95% of the labor disputes brought to mediation are concluded through negotiations that lasted for one day or less.
Although some are of the opinion that bringing monetary limits for the disputes or negotiation obligations may decrease the workload of the courts, the legislator has prepared the Draft Law on Labor Courts (“Draft Law”) in order to reduce the amount of workload of the labor courts, and the amount of the labor law disputes brought before the judicial authorities. In addition, relevant legislation has been amended, accordingly.
The new legislation mandates application to mediate as a pre-condition before filing a lawsuit, especially in some labor law disputes. Since mediation is an alternative dispute resolution method, the parties are not obliged to agree once they apply to the mediator, and they have the right to claim rights before the court should they fail to reach an agreement before the mediator.
However, it has been set forth in the Draft Law that the non-participating party of the mediation without a valid excuse shall be obliged to pay all of the litigation expenses even, if the judgment is rendered in favor of the absent party. It has been also stipulated that non-attendance and relevant issues shall be addressed by the mediator in the official report.
As per Draft Law, as a pre-condition to file a lawsuit, employees and employers are required to apply for a mandatory mediation before filing a lawsuit for any receivables (excluding disputes relating to material or immaterial indemnity claims arising from a disability due to work accidents and recourse actions regarding the same) as well as re-employment lawsuits. Such claims should have arisen due to employment related matters.
As well, the Draft Law amends Articles 20 and 21 of the Labor Law, which are regarded as “labor protection,” stipulating that the parties are required to apply for mediation as a pre-condition before filing a lawsuit. It has been also set forth that the parties may appeal the judgment in the court proceedings, and the judgment to be rendered by the Court of Appeal shall be final and binding.
In addition, the Draft Law amends the form of the judgment for re-employment lawsuits in which the compensation covering the period the employee has not worked during the lawsuit is rendered on a monthly basis on the grounds that it has created the need to bring an additional lawsuit to calculate the amount corresponding to the subject period. In this respect, the Draft Law provides that the compensation covering the subject period shall be rendered monetarily.
Mediators who would like to mediate in this mandatory process should register with the Registrar of Justice Commission, indicating their expertise. The mediators are required to conclude the application within three weeks, and may extend this period for one week.
In the Draft Law, it is explicitly stated that the disputes to be heard before the labor courts would be subject to simplified trial procedure, and the procedure regarding the right to appeal is regulated in line with Law on Civil Procedure No. 6100. Additionally, along with the provisions stipulated in the Labor Law, the time bar shall be five years for claims regarding severance and notice payments, annual leave payments, compensation of bad faith, and the termination of contract that breaches the principle of equality.
The Draft Law envisages various amendments on Law on Mediation in Civil Disputes No. 6325, as well. In the Draft Law, particularly, an amendment that would render the mediator more active in settlements has been envisaged. In this respect, it is stipulated that in a dispute to be brought before the mediator, the mediator would be able to “propose a solution in cases where the parties fail to reach an amicable solution.” If the parties come to an agreement, the annotation on the enforceability of the agreement can be obtained from the civil court of peace where the mediator has been registered. Additionally, the Draft Law sets forth that the agreement that has been signed by parties, their lawyers and the mediator has the power of verdict without seeking an annotation, and that the agreed issues cannot be challenged before the courts.
The growth in the population, development and changes in business life causes new problems. There are various reasons that provoke disputes among employees and employers. The labor law disputes have an enormous share in Turkey’s legal agenda, and they require serious efforts.
The alternative dispute resolution methods provide significant solutions without the need to resort to the judicial authorities in developing societies and legal orders. Mediation is among these methods.
The mediation method that has been applied in Turkey enables resolution of a high number of disputes that are mainly based on labor law via an agreement.
For this reason, the legislator has prepared the Draft Law that will oblige parties to apply to mediation prior to applying to the courts for debts stemming from labor relations, and core subjects, such as re-employment. The regulative works have been ongoing to improve the efficiency and role of mediation in the resolution of disputes in Turkey. The Draft Law is currently on the agenda of the Grand National Assembly of Turkey.