We present to your information the questions and answers that we have prepared as an introduction to the subject of severance and notice pay , in  order to satisfy the curiosity about the seniority and notice pay , which is one of the most curious subjects of the employees or those whose business relationship has just ended,  and to answer the questions in their minds.

WHAT IS SENIOR COMPENSATION ?

Severance pay ; _ _ It is a type of compensation in which the worker is entitled to an average of thirty days’ gross wage for each year of seniority in the event of termination of the employment contract without just cause or for a valid reason.

Severance and notice pay is regulated within the framework of the Labor Law No. 1475 as the guarantee of the workers. In a sense, the labor law is the guarantee of both the employee and the employer.

WHAT ARE THE CONDITIONS TO BE ENTITLED TO SENIORITY?

In order for a person to be entitled to severance pay, he must first meet the conditions of “being a worker” specified in the Labor Law No. 4857. In addition, any employee who meets the conditions must have been working in the same workplace or in different workplaces of the same company for 1 year. Every employee who meets these conditions has passed the first stage of being entitled to severance pay. However, meeting these conditions alone is not sufficient to qualify for severance pay. 

IN WHICH TERMS IS THE WORKER QUALIFIED TO RECEIVE SENIOR COMPENSATION?

In order to receive severance pay, any of the situations listed below must have occurred. In short, the terms of severance pay are listed as follows:

• The employer’s dismissal of the employee without any of the justified reasons specified in the law.
• The work that is the subject of the employment contract endanger the health or lifestyle of the employee.
• The employer or another employee with whom he has to work with a contagious disease.
• The employer gives false information to the employee about the qualifications of the job at the time of signing the employment contract.
• Insulting the employee or any member of the employee’s family by the employer, making defamatory accusations or sexual harassment.
• The employer asks the employee to do an illegal job.
• After the employee has been sexually harassed by another employee, despite reporting this to the employer, the employer does not take any action.
• The occurrence of a situation in the workplace that will cause the work to be stopped for more than one week.
• The female employee’s desire to leave the job within 1 year after marriage.
• The recruitment of a male employee to perform his military service.
• Entitlement to retirement.
• Formation of disability.
• Employee death.

If any of the above-mentioned situations occur, the employee is entitled to receive severance pay. 

Different procedures may be applied for employees in enterprises with some special conditions such as the laws numbered 854, 5953 and 5434. In case the severance pay is not paid on time, it can be obtained through the court and with legal interest.

In the case of severance pay, the statute of limitations is five (5) years, according to Annex 3 of the new Labor Law. This period will start to run from the date of termination. However, if the worker is unable to file an employment lawsuit with a request for severance pay within the statute of limitations, he will not be able to file a severance pay suit for this work again, and his request for severance pay will be time-barred.

HOW TO CALCULATE SENIORITY BENEFITS?

Contrary to popular belief, employees are not paid severance pay as much as their last gross salary. Some items, such as stamp duty, are deducted. The method to be used for the calculation of severance pay is as follows: 

• The total time worked by the employee is determined.
• The employee’s total number of years worked is multiplied by the last gross wage (including travel, meals, and other fringe benefits).
• The total number of days outside the 1 full-year period is determined and multiplied by the daily gross wage.
• Stamp duty of 0,759% is deducted from the resulting amount and the remaining amount shows the severance pay amount and this amount is paid to the employee. 

In addition to severance pay, it is also possible for employees to receive notice pay. The notice indemnity is determined according to the notice period. Unlike severance pay, payments are made with some deductions such as income tax. 

IN WHICH AREAS OF BUSINESS EMPLOYEE CANNOT RECEIVE SENIORITY COMPENSATION?

Severance pay is regulated in the Labor Law  No. 4857  . In order to be entitled to severance pay, it is necessary to be working in one of the business areas covered by the Labor Law. Employees working in areas that are not subject to the Labor Law cannot receive severance pay  . The areas outside the scope of the Labor Law are:

– Sea and air transport works,

– In the workplaces or enterprises where agricultural and forestry works are carried out with less than 50 workers (including 50),

– All kinds of construction works related to agriculture within the borders of the family economy,

– Works where handicrafts are made in homes and between members of a family and their relatives up to the 3rd degree (including the 3rd degree), with no outside participation,

– home services,

– Apprentices, without prejudice to the provisions of occupational health and safety,

– Athletes,

– Those who have been rehabilitated,

– Workplaces where three people work in accordance with the definition of Article 2 of the Law No. 507 on Tradesmen and Craftsmen.

These areas  are outside the scope of the Labor Law , and employees working in these areas will not receive  severance pay  .

CAN NO ONE WORKING IN THESE BUSINESS LOCATIONS RECEIVE SENIOR COMPENSATION ? _ _ _ ARE THERE EXCEPTIONS ?

In the Labor Law , it is stated that even if they are related to the fields that are not subject to the Labor Law, the provisions of the Labor Law will be applied and therefore, the jobs that may be entitled to severance pay. Therefore, employees in the following jobs will  be  entitled to severance pay :

– Loading and unloading works from ships to land and from land to ships at coasts or ports and piers,

– Works carried out in all ground facilities of aviation,

– Works performed in workshops and factories where agricultural arts and agricultural tools, machinery and parts are made,

– Construction works in agricultural enterprises,

– Park and garden works that are open to the public or as an add-on to the workplace,

– Works related to aquaculture producers working in the seas, which are not covered by the Maritime Labor Law and are not considered agricultural works.

CAN A EMPLOYEE WHO LEFT WITH THEIR OWN CONSENT RECEIVE REFUND ? _ _ _ _ _

As a rule,   a worker who  quits his job voluntarily and resigns cannot receive severance pay  . However, the worker; In cases where the employee leaves the job due to military service, being entitled to retirement, the health of the worker is so bad that he cannot continue to work continuously, the employer’s goodwill and immoral behavior or the marriage of female workers, the  employee is entitled to severance pay  . In case of leaving the job for these reasons, the condition of having worked for 1 year is sought.

IF AN EMPLOYEE WHICH IS NOT HIGHLY RELEASED , LEFT THE WORK FOR THIS REASON , CAN I RECEIVE SENIOR COMPENSATION ?

The regulation in the law   consists only in the fact that a worker cannot be employed with a salary below the minimum wage . Apart from this,  how much the employee’s salary  will be or how much increase will be made depends on the provisions of the contract or on the initiative of the employer. If there is no binding provision regarding salary increase in the employment contract, if the employee resigns due to not increasing his salary, he/she can  not be entitled to severance pay  .

CAN AN EMPLOYEE LEFT FROM EMPLOYMENT FOR RETIREMENT GET COMPENSATION ? _ _ _ _ _ _ _ _ _ _ _ _ _

Workers who are entitled to retirement by completing the required insurance period and the number of premium payment days  will be entitled to receive severance pay if they leave the job voluntarily  .

WHAT IS NOTICE COMPENSATION?

Notice indemnity ; _ In the event that the employment contract is terminated without complying with the periods specified in Article 17 of the Labor Law No. 4857, the type of compensation that the party that terminates the employment contract is responsible for paying the other party in the amount of the wage for the notice period is called notice compensation.

The opposite of this situation is also true. If the employee leaves the job without prior notice in accordance with the periods specified in the law, he has to pay notice compensation to the employer.

Conditions of Notice of Compensation:

– Must be an indefinite term contract

– There should be no justifiable reason for termination in terms of the employee or employer

– The employment contract must be terminated without complying with the notice periods stipulated in the law.

Notice Periods:

The notice period is the period that begins to run from the receipt of the employer’s or employee’s notice of termination to the other party. These periods vary according to the law, according to the period of time the employee works in that workplace.

These times are:

Even if the parties terminate the employment contract as stipulated, they must continue to work within the specified periods. Undoubtedly, this continuation is not a necessity, for example, the employer who does not want to continue with the worker can terminate the employment contract immediately by paying the notice indemnity in the amount of the above-mentioned periods, while the worker who does not want to continue working with the employer can terminate the employment contract by paying this compensation. Again, since the notice periods mentioned above are of a relative imperative nature, these notice periods cannot be removed or reduced by the parties, but these periods can be increased by agreement between the parties.

IS THERE A JOB SEEK PERMISSION DURING THE NOTIFICATION PERIOD?

According to the labor law; The employer must allow his worker 2 hours a day to find a new job. The daily leave should be during working hours and wage deductions should not be made.

If the worker wishes, he can combine the 2 hour leave and use it collectively. If the employee is not allowed to work, the employer is obliged to pay the wages of the time he worked with a 100% increase.

WHAT HAPPENS IF THE NOTICE PERIOD IS NOT FOLLOWED ?

Failure to comply with notice periods;

• For the working period whose service period is less than 6 months; Notice indemnity in the amount of 2 weeks’ wage,
• For the working period of 6 months to 1.5 years; Notice indemnity in the amount of 4 weeks’ wage,
• For the period of service from one and a half to 3 years; Notice indemnity in the amount of 6 weeks’ wage,
• For the working period of which the service period is more than 3 years, an obligation to pay notice indemnity in the amount of 8 weeks’ wage arises.

DOES THE NOTICE HAVE A SPECIFIC FORM CONDITION? DOES IT HAVE TO BE WRITTEN?

It is stated in the Labor Law that the employer has  to make a written notice  of termination and state the reason for termination clearly and precisely. For this reason, the employer will not be deemed to have made a notice of  termination  unless he/she makes a written notice of termination. However, the condition of being in writing is stipulated only for the employer, that is, for the workers, the written notice is not a validity condition, it is only important in terms of proof. A worker can also give notice of termination verbally   and he can prove that he has made a notice with all kinds of evidence, but it  should be preferred in  writing in order to provide ease of proof.

HOW IS DETENTION COMPENSATION CALCULATED ?

Notice pay is the amount of  gross salary corresponding to the notice periods determined according to the working period of the worker  . The worker  or  employer who has not been  notified will be entitled to notice compensation equal  to the gross salary  of the worker corresponding to the period of  notice. Only income tax and stamp duty can be deducted from the notice indemnity.

If we are to calculate an example notice pay, for a worker with a 1-month salary of 3,000 TL and who has worked for 5 years:

Daily salary: 3000 / 30 days = 100 TL

Weekly salary: 100 * 7 days = 700 TL

Since this person has been working for more than 3 years, compensation should be paid as much as 8 weeks’ gross wage.

8 weeks * 700 = 5.600 TL gross notice indemnity. Income and stamp tax are deducted from this amount. The net notice pay amount is revealed.

CAN AN EMPLOYEE WHO LEFT THE WORK voluntarily RECEIVE NOTIFICATION COMPENSATION?

In the event that the employee leaves the job or  resigns voluntarily, regardless of the reason for leaving, no notice  indemnity  will arise   .

WHAT IS THE TIME-OUT PERIOD FOR DEFINITIONS?

The statute of limitations is 10 years from the birth of the right, as in the severance pay. If notice indemnity is not paid within this period, a lawsuit can be filed.

WHAT ARE THE DIFFERENCES BETWEEN DETENTION COMPENSATION AND SENIORITY COMPENSATION?

The main difference between severance pay and notice pay is the payer. Severance pay is only paid by the employer. Notice pay can be paid by both the employer and the employee. Because the condition of notice indemnity is non-compliance with the notice period. In other words, if the employee does not comply with the notice period, he is obliged to pay the workplace. Other differences between severance and notice pay are listed as follows:

• Only stamp duty is deducted from severance pay. In the case of notice indemnity, an income tax deduction is made in addition to the stamp tax. 

• In a fixed-term employment contract, notice indemnity is not paid. Severance pay is not paid in fixed-term employment contracts. However, if the employer makes an unjust termination or the employee uses his right of termination, the right to severance pay may arise. 
• In order to be entitled to severance pay, 1 year of working period is required,

This period for notice indemnity is 6 months.

As İ&G Accounting, we are always with you to respond to the needs of our valued clients.