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Opinion

31 Aug 2021

Author:
Betül Karagedik

Elephant in the room: Code-29 and the need for mandatory human rights due diligence in Turkey

By Betül Karagedik, PhD student of business and human rights at Galatasaray University

The Covid-19 outbreak has triggered a severe economic crisis all over the world, leading states to take various legal and administrative decisions to support the economy. In Turkey, for this purpose, a temporary article was added to the Labour Act of Turkey No: 4857 introducing a ban on the dismissal of employment contracts, which continued from April 2020 until June 2021. However, the second paragraph of article 25 of the Turkish Labour Act (article 25/2), which regulates the right of employers to immediately rescind contracts on the basis of “immoral, dishonourable or malicious conduct or other similar behaviour”, was exempted from the ban.

What is Code-29?

In Turkey, any worker’s departure or dismissal must be reported to the Social Security Institution by their employer. This notification is made through specific codes pertaining to reasons for dismissal. Dismissals based on article 25/2 were reported via Code-29 to the Social Security Institution before the amendment in April 2021. The relevant paragraph covers matters such as willful and continuous neglect of duty, unexcused absence, sexual harassment, theft and drug use. The use of a single code to report widely differing reasons for dismissal to the Social Security Institution has caused serious problems for workers. News reports indicate workers accused of “immorality” have difficulty finding new jobs, with female workers particularly affected by Code-29. Female workers who are dismissed for allegedly immoral behaviour also experience gender-based discrimination and sexist prejudices from potential employers. In addition, those who are dismissed under Code-29 are deprived of severance pay and unemployment benefit.

News reports indicate workers accused of “immorality” have difficulty finding new jobs, with female workers particularly affected by Code-29. Female workers who are dismissed for allegedly immoral behaviour also experience gender-based discrimination and sexist prejudices from potential employers.

The Social Security Institution issued a press release regarding Code-29, stating that “Since it was seen that the notification of completely different reasons for termination with the same code (Code-29) caused uncertainties in business life, separate codes were determined for all immoral, dishonorable or malicious conducts with the amendment made in the Social Security Institution circular”. Although introducing separate codes for different acts is a positive step, the institution failed to solve the underlying problem. Employers still have the right to rescind employment contracts without proving the reason they put forward, and any reemployment lawsuit filed by the employee upon rescission may take a very long time. In other words, employers may arbitrarily decide to rescind a contract, leaving workers to face the same issues presented by Code-29.

Code-29 in the context of Covid-19

Code-29 is not a new issue, but its effect on workers became more severe during the pandemic period. Despite the dismissal ban, employers continued to dismiss workers under Code-29. According to official data, 176,662 workers were dismissed under Code-29 in Turkey in 2020. While this figure is lower than the number of workers laid off under Code-29 in 2019 and 2018, the fact that so many workers lost their jobs during a period of economic downturn during the pandemic is a cause for concern. Amid economic crisis, dismissed workers who face the additional stigma of “immorality” under Code-29 struggle to find work.

Moreover, news reports suggest some workers were targeted for dismissal via Code-29 because of their unionisation. If this is the case, employers have violated union rights by abusing the unemployment situation caused by the economic crisis.

The continuation of dismissals by applying exception provisions despite the ban demonstrates widespread failure by Turkey’s business enterprises when it comes to human rights due diligence.

The dismissal ban introduced to tackle the economic effects of the Covid-19 outbreak in Turkey failed to achieve its purpose, and employers used Code-29 to break the ban. Code-29, which presents concerns for human rights in business, demonstrates labour rights were not protected during the pandemic in Turkey and that the state could not fulfil its obligations to workers. Furthermore, business enterprises have failed to carry out due diligence on human rights. The UN Guiding Principles on Business and Human Rights (UNGPs) state that “In practice, some human rights may be at greater risk than others in particular industries or contexts, and therefore will be the focus of heightened attention”. It is possible to interpret the word “context” in this sentence as a crisis situation. Therefore, the UNGPs highlight the necessity of human rights due diligence in times of crisis such as the Covid-19 pandemic. However, the continuation of dismissals by applying exception provisions despite the ban demonstrates widespread failure by Turkey’s business enterprises when it comes to human rights due diligence.

The immediate need for national legislation on mandatory human rights due diligence

The issues around Code-29 reveal Turkish legislation and its implementation fall short of ensuring business respect for human rights. In the context of the three pillars of the UNGPs, the state has failed to protect labour rights, and businesses have failed to respect these rights. Moreover, the long waits faced by workers seeking reemployment and other rights indicate there are severe problems in terms of access to remedy.

It seems there is an immediate need for national mandatory human rights due diligence in Turkey – legislation which can keep pace with global developments such as upcoming EU mandatory human rights and environmental due diligence law. The EU legislation will make it mandatory for businesses to carry out effective due diligence with respect to potential or actual adverse impacts on human rights. Such law requires businesses to respect human rights and has the potential to be an effective tool in preventing business-related human rights violations. If introduced, mandatory due diligence legislation at a national level in Turkey could reduce the risk of human rights violations against workers under the guise of exceptions like Code-29.

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