Background
A public General Directorate outsourced security services at its headquarters and airports to several contractors. After 11 workers employed through those contractors were dismissed, they obtained judgments against the Directorate as the principal employer and pursued judgment-enforcement proceedings. The Directorate paid the resulting employment claims and sued the contractors to recover those payments, with commercial advance interest from the respective payment dates.
The Ankara 7th Commercial Court apportioned severance pay and annual-leave compensation among the contractors, converted the workers’ gross claims into net amounts, and treated notice compensation as the responsibility of the final employer. Because it found no contractual provision expressly assigning the employment liabilities to the contractors, it applied a 50-50 allocation and awarded specified amounts against three contractors, with interest from the filing date. The Directorate and some contractors appealed, disputing, among other issues, the contractual allocation of liability, limitation periods, calculation methodology, interest, and the extent of each contractor’s responsibility.
The Court’s Holding
The Regional Court of Appeal held that, although the Directorate and the contractors were jointly liable to the workers under labor law, their internal reimbursement relationship was governed by their service-procurement contracts. Because the workers were employed by the contractors, wages and social benefits were included in the contract price, and the contracts did not make the Directorate ultimately responsible for employment claims, the Directorate was entitled to recover from the responsible contractors the full amounts it paid, together with associated sums. The contractual requirement that contractors comply with mandatory employment legislation reinforced that conclusion.
The court explained that severance liability must be allocated among successive contractors in proportion to the periods during which each employed the worker, using the worker’s final gross remuneration. The final contractor is responsible for notice compensation and unused annual leave that became payable upon termination, while items such as overtime, unpaid wages, and weekly-rest pay are allocated according to the relevant employment periods. Because the trial court instead relied on an unsuitable expert report that converted gross wages to net amounts and applied an incorrect allocation, the appellate court accepted the Directorate’s appeal, vacated the judgment under Article 353(1)(a)(6) of the Code of Civil Procedure, and remanded for a new expert report and retrial without examining the remaining appellate arguments. Its decision was final.
Key Takeaways
- Joint liability to outsourced workers does not determine the ultimate allocation of liability between a principal employer and its contractors; that reimbursement question is governed by their contracts.
- Successive contractors bear severance liability proportionately for their own employment periods, while the final contractor bears notice compensation and compensation for unused annual leave triggered by termination.
- A reimbursement judgment cannot rest on an expert calculation that improperly converts gross employment liabilities into net amounts or otherwise applies the wrong allocation rules.
Why It Matters
The decision clarifies how Turkish courts should allocate employment-related payments between public entities and successive service contractors after workers recover from the public entity as principal employer. It distinguishes external statutory liability to employees from the parties’ internal contractual reimbursement rights.
It also underscores that expert reports must calculate each category of employment claim under the correct liability rule. Where the report’s methodology cannot support that analysis, the judgment may be vacated and the case returned for a fresh calculation.