Turkish Labour Courts: Scope, Jurisdiction, And Legal Processes

Introduction

In the complex arena of employment relations, conflicts between workers and employers are nearly inevitable, given the dynamic and sometimes contentious nature of labour rights and obligations. To ensure that such disputes are resolved efficiently, fairly, and by subject-matter experts, Turkey has established a dedicated judicial body: the Labour Courts ("İş Mahkemeleri"). These courts play a pivotal role in interpreting and applying employment law, safeguarding social security rights, and providing a mechanism for the peaceful resolution of workplace-related disagreements.

This comprehensive guide delves into every critical aspect of Labour Courts in Turkey—from their legal foundations and jurisdiction to their unique procedural rules, the essential requirement of mandatory mediation, and the appellate avenues available for contesting decisions. Through practical examples, case law analysis, and step-by-step explanations, this resource aims to demystify the functioning of Labour Courts for those navigating the Turkish legal system, whether as employees, employers, HR professionals, or legal practitioners.

The Legal Framework and Role of Labour Courts

The Foundation and Nature of Labour Courts

Labour Courts are a type of first-instance civil court, established to resolve disputes arising specifically from employment relationships and certain matters involving social security law. Their existence is grounded in Law No. 7036, known as the Labour Courts Act, which sets forth their structure, remit, and procedural specifics. Unlike general civil courts, Labour Courts are considered "special courts" or specialized tribunals. This specialization is critical, as the issues brought before these courts often require a nuanced understanding of employment law, collective bargaining dynamics, and social insurance regulations.

Specialization and the "Special Court" Status

Turkish civil procedure divides courts into "general" and "special" jurisdictions. While general courts (like civil courts of first instance or peace courts) have broad, default authority over most private disputes, special courts are created by legislation to address particular subject matter. Labour Courts, together with others like Family Courts or Intellectual Property Courts, exemplify this model. The specific nature of Labour Courts means that any legal matter falling within their defined scope must be heard by them—and not by a general court—unless a law provides otherwise.

Rationale for Labour Courts

The logic behind the formation of these courts is rooted in the need for specialized legal expertise and accelerated proceedings. Employment disputes often have direct implications on a person's livelihood, social security rights, and the economic stability of both parties. Therefore, the Turkish legal system prioritizes not only expertise but also promptness, aiming to deliver justice without unnecessary delay.

Types of Cases Heard by Labour Courts

Core Areas of Jurisdiction

Labour Courts are competent to adjudicate a wide range of disputes. The principal areas include:

1. Employment Contract Disputes

• Termination Claims: Claims relating to unfair or invalid termination, including demands for reinstatement or compensation due to unjust dismissal.
• Compensation and Financial Claims: Lawsuits seeking severance pay, notice compensation, bad faith damages, wage arrears, overtime pay, and annual leave entitlements.
• Rights Sourced from Employment Law: Any claim or right directly arising from the employment relationship—be it contractual or statutory.

2. Social Security Disputes

• Insurance Period Verification: Actions concerning the verification of periods of employment for social security purposes.
• Pension Entitlement: Disputes regarding the right to old-age or retirement pensions and the calculation of qualifying periods.
• Disability and Survivors' Benefits: Cases relating to compensation or benefit entitlements due to disability or death resulting from work accidents or occupational diseases.

3. Collective Labour Law

• Union Dues Disputes: Lawsuits filed by trade unions regarding unpaid union dues deducted by employers.
• Collective Agreement Rights: Enforcement or interpretation of collective agreements, or disputes arising from such instruments.

4. Employment Relationship Verification

• Status Determination: Actions establishing the existence (or absence) of an employment contract, or clarifying the nature of a working relationship (e.g., distinguishing between employee and contractor).

5. Employer and Employee Misconduct

• Defamation and Personal Rights: Lawsuits relating to insults, harassment, or other personal rights violations occurring within the employment context.

6. Disputes Involving the Social Security Institution or Employment Agency

• SGK and İŞKUR Disputes: Any issue stemming from the obligations or actions of the Social Security Institution (SGK) or the Turkish Employment Agency (İŞKUR), except where the law specifically excludes certain matters (e.g., administrative fines).

Case Study: Examples from Practice

• Severance Pay Lawsuit: An employee dismissed after ten years claims unpaid severance pay from their employer. This falls squarely within the Labour Court's jurisdiction.
• Work Accident Compensation: A construction worker seeks compensation after suffering permanent injury on site. The Labour Court hears both the compensation claim and any related social security disputes.
• Service Period Dispute: A retiree alleges that their employer failed to register several years of employment with the SGK, thus affecting their pension eligibility. The Labour Court is competent to resolve the dispute.

Mandatory Mediation as a Condition for Lawsuits

The Introduction of Compulsory Mediation

With the reforms introduced by Law No. 7036, Turkey adopted a mandatory mediation mechanism for many employment disputes before they can be brought before a Labour Court. This system aims to reduce the court's burden, promote amicable settlements, and encourage parties to resolve conflicts without litigation.

Which Disputes Require Mediation?

Before filing a lawsuit, parties must attempt mediation in the following scenarios:

• Claims for Compensation or Monetary Rights: Including severance, notice, bad faith compensation, unpaid wages, overtime, annual leave, and similar entitlements.
• Reinstatement (Return to Work) Claims: Lawsuits seeking to invalidate a dismissal and compel the employer to reinstate the worker.
• Personal Rights Violations: Disputes over workplace insults, harassment, or emotional distress compensation.

If mediation fails, a formal record ("final report") is issued, allowing the claimant to proceed with a lawsuit. Skipping this step results in the court dismissing the case for lack of procedural prerequisites.

Exceptions to Mandatory Mediation

Some disputes are exempt from compulsory mediation:

• Declaratory Actions: For example, lawsuits establishing the existence of an employment relationship or determining insurance periods.
• Work Accident Compensation: Cases seeking compensation due to injury or death from work accidents.
• Certain Social Security Disputes: Where explicit statutory provisions permit direct recourse to court.

Practical Example: Mediation in Action

Suppose an employee, Ayşe, seeks unpaid overtime wages. Before she can sue her employer, she must first apply to a certified mediator. If the employer refuses to settle or mediation fails, Ayşe receives a final report enabling her to file her claim in court.

Procedure and Conduct of Proceedings in Labour Courts

Simplified Procedure: Expediting Justice

Labour Courts utilize a streamlined procedure, known as the "simple trial procedure," designed to ensure swift resolution. This approach deviates from the more elaborate processes of general civil courts.

Key Features of the Simple Procedure

• Limited Exchange of Pleadings: Only an initial claim and a single response are permitted. No further rounds of written pleadings (such as replies or rejoinders).
• Short Deadlines: The defendant has two weeks from notification to submit their response.
• Immediate Evidence Disclosure: Parties must submit all evidence and specify its relevance in their first filings. Late evidence submissions are generally not allowed unless excused by the court for exceptional reasons.
• Restriction on Amending Claims or Defenses: The ability to expand or alter claims/defenses is curtailed once the pleadings are submitted.

Judicial Economy and Expedition

By limiting the number of procedural steps and requiring early submission of all relevant evidence, the Labour Court system fosters judicial economy and reduces the time between filing and judgment. This is particularly important when employment rights and livelihoods are at stake.

The Role of Evidence

Labour disputes often hinge on documentary and testimonial evidence. Payroll records, employment contracts, SGK registration documents, and witness statements frequently play a decisive role. Given the expedited proceedings, parties must be diligent in collecting and presenting their evidence from the outset.

Determining the Competent Labour Court

Rules of Territorial Jurisdiction

Where a dispute is to be litigated is governed by strict rules:

• Defendant's Domicile: The Labour Court in the location where the employer (individual or company) is domiciled at the time of filing the lawsuit.
• Place of Work: Alternatively, the court in the locality where the work was performed or the transaction occurred may be chosen.
• Multiple Defendants: If more than one defendant is named, the court in any of their domiciles is competent.
• Work Accidents: For claims arising from workplace injuries, the court at the accident location or the injured party's domicile also has jurisdiction.

Inviolability of Jurisdiction Agreements

Agreements attempting to designate a court outside these statutory options as competent are considered invalid. The law's mandatory nature precludes parties from circumventing the territorial rules through contract.

Example: Choosing the Right Court

Imagine Mehmet, who resides in Ankara but worked at a factory in Bursa, suffers a workplace injury. He may sue either in Ankara (his domicile) or Bursa (where the accident occurred or the work was performed).

Consequences of Filing at the Wrong Court: Incompetence and Transfer

The Principle of "Res Judicata" and the Public Nature of Jurisdiction

Jurisdictional rules are regarded as matters of public order. Courts must consider their own competence ex officio—meaning, even if the parties do not object, the judge must dismiss a claim filed at an incompetent court.

Procedure Following a Finding of Incompetence

• Dismissal for Incompetence: If the Labour Court determines it lacks subject-matter jurisdiction, it will dismiss the case on those grounds.
• Transfer to Competent Court: The party must, within two weeks of the decision becoming final, request the transfer of the case file to the correct court. Failure to do so results in the case being deemed never to have been filed, with potentially serious consequences for limitation periods.
• Appeal of Incompetence Decisions: Parties may challenge such decisions through the appellate process (as set out below).

Example: Misfiled Labour Lawsuit

Suppose a dispute over a training allowance is filed at the Labour Court, but the relationship is not an employment contract under the law (e.g., an apprenticeship). The court must reject jurisdiction, and the plaintiff must seek recourse in the appropriate general civil court.

Appellate Review of Labour Court Judgments

The Two-Tier Review System

Labour Court decisions are subject to appellate review, ensuring oversight and legal consistency. The Turkish system employs two main appellate mechanisms:

1. Regional Court of Appeal (İstinaf)

• Scope: Both factual and legal issues are reconsidered.
• Threshold: Only judgments exceeding a certain monetary value (e.g., 40,000 TL for 2025) are eligible.
• Process: Appeals must be filed within two weeks of judgment notification, accompanied by a formal petition.
• Exceptions: Interim decisions (other than provisional injunctions) are generally not subject to appeal.

2. Supreme Court of Appeals (Yargıtay)

• Scope: Reviews the legal correctness of the appellate court's decision.
• Threshold: The matter in dispute must exceed a higher value (e.g., 544,000 TL for 2025).
• Process: Appeals must be brought within two weeks of the appellate decision.

Example: Appealing a Labour Court Judgment

An employee awarded 60,000 TL in unpaid wages by the Labour Court may seek a full review by the regional court of appeal. If dissatisfied with the outcome and the value exceeds 544,000 TL, further recourse to the Supreme Court of Appeals is possible.

Special Note: Counter-Appeal Rights

Both parties to a dispute have the right to appeal. Additionally, if one party appeals, the other may file a "counter-appeal" within the designated period, even if they initially did not intend to challenge the judgment.

Case Law Illustrations: Key Decisions from the Supreme Court

To better understand the application of these principles, consider the following real-world judicial decisions:

1. Nature of the Legal Relationship: Employee or Contractor?

A dispute arose when an employer claimed that the plaintiff was not an employee but an independent contractor. Although the employer produced no written subcontractor agreement and the plaintiff was registered as a worker for social security purposes, the court found that the relationship was indeed employment-based. Thus, the Labour Court retained jurisdiction.

2. Union Dues Dispute

A trade union sought payment of membership dues deducted by a municipal employer but not remitted. The Supreme Court confirmed that such disputes are within the exclusive jurisdiction of Labour Courts, as stipulated by the relevant union legislation.

3. Employer's Social Security Debt Recovery

When the Social Security Institution (SGK) attempted to recover unpaid premiums by challenging asset transfers by the employer, the court ruled that only Labour Courts could hear such claims, given the explicit provisions of social security law.

4. Work Accident Arising from a Non-Employment Contract

If the injured party was working under a contract for services (not an employment contract), the court concluded that the relationship fell outside the Labour Court's remit. Such disputes were redirected to the general civil courts.

5. Jurisdictional Challenges and the Role of Public Order

Even if both parties fail to object to jurisdiction, the court must assess its own competence and transfer the case if necessary, since jurisdiction is a public order matter.

Practical Guidance for Individuals and Employers

Navigating the Labour Court System: Step-by-Step

1. Identify the Nature of the Dispute
   
   • Is it a claim for compensation, a declaratory action, or a social security issue?
   • Determine if mandatory mediation applies.

1. Attempt Mediation (If Required)
   
   • File an application with a certified mediator.
   • Attend the mediation session; record the outcome.

1. Prepare Your Case
   
   • Gather necessary documents: employment contract, pay slips, SGK records, time sheets, etc.
   • Identify witnesses if relevant.

1. File Your Lawsuit at the Competent Court
   
   • Choose the court based on the employer's domicile or workplace location.
   • Submit all evidence and arguments in the initial filing.

1. Participate in the Hearing
   
   • Present your case and respond to the opposing party's arguments.
   • Comply with all procedural deadlines.

1. Review and Appeal if Necessary
   
   • If dissatisfied with the judgment, note the monetary threshold for appeal.
   • File appeals within the statutory deadlines.

Frequent Pitfalls and How to Avoid Them

• Failing to Attend Mediation: Skipping this step where required leads to dismissal of the case.
• Missing Deadlines: Strict time limits apply for pleadings, evidence submission, and appeals.
• Improper Jurisdiction: Filing in the wrong court may result in delays and possible dismissal.
• Incomplete Evidence: Labour Courts require all evidence to be submitted at the outset.

Conclusion

Labour Courts serve as a cornerstone of legal protection in the Turkish employment landscape, ensuring that both workers and employers have access to a fair, efficient, and specialized forum for resolving disputes. The unique procedural rules, the necessity for mandatory mediation in many cases, and the public-order nature of jurisdictional rules make it critical for parties to approach Labour Court proceedings with diligence and a clear understanding of their rights and obligations.

Whether you are an employee seeking redress for unpaid wages, an employer aiming to defend against an unjust claim, or an HR professional managing workplace disputes, navigating the Labour Court system effectively requires attention to both substantive and procedural detail. Engaging with the process fully—from mediation through to the final appellate review—will help ensure that justice is served in accordance with Turkish law.

For complex or high-value disputes, or where the legal relationship is ambiguous, consulting with a legal professional specializing in employment law is strongly recommended.

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.