Legal-Economic Analysis of Contractorship Premium Rates: The Criticism of Social Security Organization and the Administrative Justice Tribunal

Social Security Organization (SSO) is regarded as one of the most important social and economic institutions for its effective role in protection of labor. In the past decades, it was keeping balance between SSO’s incomes and costs that constituted the main concern of the SSO officials. The problem of contractorship premiums has been one of the main legal challenges the SSO has experienced with its premium-payers. Since 1370, SSO by issuing the Directive 149 provided for some fixed rates for non-state projects that caused a serious legal challenge between SSO and economic actors. By landmark judgement of 1378, Administrative Justice Tribunal (ADT) solved the problem in favor of SSO. Contractors who were not satisfied with the judgement raised the externalities originating from the Directive before legislatures, and since 1384 were able to cause some legislations aimed at reforming SSO practices to be enacted. However, SSO, has continued to insist on its previous position by raising some legal scepticism. This article, shall seek, based on legal and economic foundations, to study the SSO practice and its judicial confirmation by ADT from a critical point of view.