The rules on severance pay in detail

The legal entitlements upon termination are as follows:

  • Accrued unpaid due salary and benefits
  • Unused annual leave accrued during employment 

This is calculated as daily pay x the number of accrued but unused days of annual leave. 

  • Pay in lieu of notice

Where a notice period is not provided and termination is not for just cause, before terminating an employment agreement for an indefinite term, a notice to the other party must be served by the terminating party. The notice periods given below are the minimum and can be increased by the employment agreement or collective bargaining agreements. 

Duration Of Employment Notice Period
Less than 6 months 2 weeks
6 months to less than 1.5 years 4 weeks
1.5 to 3 years 6 weeks
More than 3 years 8 weeks

 

The terminating party may immediately terminate the employment agreement by paying in advance the salary plus benefits (as detailed below) corresponding to the notice period.  In cases of payment in lieu of notice, all the monetary benefits plus any other benefits that can be measured in monetary terms emanating from the employment agreement and Labour Law must be taken into consideration in addition to the salary.

  •  One year's of service and termination is not with just cause

In such cases, statutory severance is paid to the employee in the amount of 30-days’ salary (plus benefits) for each completed year of service. For the last year, the payment is pro-rated, based on time worked. Note however, that there is a semi-annually determined statutory cap on payments. Currently, this is TRY 5.434,42 gross (until the end of 2018).

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Author: Bener Law Office

Date: December 2018

 

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