Employment Law in Turkey: discover what only the top, expert employment (labour) lawyer in Turkey know about employment law in turkey
Under Turkish law, employees are in entitled to certain rights in case of termination of their employment. This article will examine severance and notice pay.
Severance pay is the type of compensation that the employer is obliged to pay, taking into account the severance and wage of the employee, in case the employment contract of the employee who has completed the minimum working period, is terminated due to one of the reasons specified in the Turkish Labour Act numbered 4857 (“Act”);
Minimum One Year Seniority Period
In order for the employee to be entitled to severance pay, it is obligatory to have at least one year of seniority at the workplace on the date of termination.
Termination of Employment Contract for Certain Reasons
The second condition for the employee to be entitled to severance pay is the termination of the employment contract due to one of the cases listed in the relevant legislation.
In cases of termination other than those stipulated in the legislation, such as the termination by mutual agreement of the parties, the expiration of a fixed term contract or the termination of the employee due to non-justified termination (resignation), this compensation will not be paid. However, by amending the employment contract in favor of the employee, the parties may decide to pay severance pay in cases that do not require the payment of severance pay by law.
Conditions of Termination by the Employer other than Labour Act Article 25 / II
In the termination made by the employer, the only situation that deprives the employee, who has more than one year of seniority, from severance pay, is the rightful termination under Article 25/II of the Code. In case the employment contract is terminated by the employer, except for the cases specified in Article 25/II of the Labour Act titled ” Cases Contradicting The Rules Of Ethic And Goodwill And Similar Cases: “, the employee is entitled to severance pay.
The situations specified in Article 25/II are as follows;
- If the employee misleads the employer at the time of conclusion of the labour contract by asserting that he/she meets the qualifications or conditions required for one of the essential points of the contract although he/she does not meet them, providing unrealistic information, or making unrealistic statements.
- If the employee tells words that will harm the honour and good name of the employer or one of the members of his/her family, behaves in such manner or makes baseless denouncements or allegations harming the honour and dignity of the employer or one of his/her family members.
- If the employee attempts sexual harassment against another employee of the employer.
- If the worker teases the employer or one of his/her family members or another employee of the employer or comes to workplace under the influence of alcohol or narcotic drugs or uses such at work.
- If the employee attempts behaviours contradicting honesty and loyalty, such as misuse of the trust of the employer, theft and disclosure of professional secrets of the employer.
- If the employee commits an offence at the workplace, which leads to imprisonment for more than seven days and the penalty of which is not deferred.
- If the employee does not come to work during two consecutive business days or twice in a month on a day following any holiday or three days within one month without receiving the permission of the employer or without any justified reason.
- If the employee insists on not performing the duties assigned to him/her although he/she is reminded thereof.
- If the worker jeopardises safety at work due to his/her own will or negligence or causes damage and loss on the machines, installations or other property and materials that belong to the business or do not belong to the business, but are available there, at a degree that he/she cannot compensate with the amount of his/her thirty-day wage.
Immediate Termination by the Employee for valid reasons in accordance with the Labour Act, Article 24
If the employee terminates the employment contract with just cause in accordance with Article 24 of the Act, he / she is entitled to severance pay. For this reason, in case the employment contract is terminated by the employee, in order for severance pay to arise, the termination must be based on health reasons listed in the law, the employer’s behavior against the rules of ethics and goodwill or compelling reasons.
Termination due to active-duty military service
In case the employee leaves his job due to active military service, he is also entitled to severance pay.
Termination Due To Old Age Pension (Retirement)
The employee is also entitled to severance pay if he/she terminates the employment contract in order to receive old age, retirement or disability pension.
Termination in case of death of the employee
In the event of the termination of the employment contract due to the death of the employee, the legal heirs of the employee, who has completed one year of employment, are entitled to severance pay.
How is Severance Pay Calculated?
An employee is paid severance pay in the amount of thirty days’ wages for each full year from the date of starting work. Payments are made pro rata for periods less than one year. Severance pay is calculated with reference to the final wage of the employee. This wage is the gross wage of the employee. Fringe benefits such as transport fee or meal fee are also included to the gross wage.
In the event that an indefinite-term employment contract is terminated by one of the parties without complying with the notification periods in the Labour Act, the party that does not comply with the notification period must pay compensation in the amount of the notice period. This compensation is called “notice pay”. Situations that allow the parties to terminate immediately in the Labour Act are reserved.
In case the employment contract is terminated by the employee without complying with the notice periods, the employer’s notice compensation request may also be in question.
According to the Article 18 of Labour Act, contracts shall be considered to be terminated.
- Two weeks after the notification, for employees who have worked less than six months,
- Four weeks after the notification, for employees who have worked between six months and one and a half year,
- Six weeks after the notification of the employee, for workers who have worked between one-and-a-half and three years,
- Eight weeks after the notification, for employees who have worked more than three years.
How is Notice Pay Calculated?
Notice pay is calculated by considering the above notification periods, which must be followed according to the employee’s seniority at the workplace.
This compensation is determined on the basis of the gross wage of the employee at the time of termination. In addition to the basic wage, the calculation is determined by considering pecuniary fringe benefits provided by the contract and Act.