Uçkan Law Ankara · Türkiye

Employee Claims and Types of Compensation

Written by Betül Uçkan, Attorney 6 min read

Employee claims under the Turkish Labour Act No. 4857, divided into those that depend on termination — severance pay, notice pay, annual leave pay, bad-faith compensation — and those that do not, such as wages, overtime and holiday pay.

Employee Claims and Types of Compensation

Employee claims are governed by the Turkish Labour Act (Law No. 4857) and refer to certain rights and entitlements that arise on termination of the employment contract.

These rights vary according to how the contract between employee and employer comes to an end. A distinction should first be drawn between claims that depend on termination and those that do not; the entitlements should then be assessed according to whether the termination was justified or unjustified.

Claims not dependent on termination

Wage claims

Wages are an essential element of the employment contract: the amount paid by the employer in return for the work performed. Wages must be paid at least once a month.

The contract need not have ended for the employee to claim unpaid wages; the employee may claim them from the employer while the employment continues. The burden of proving the amount of the wage rests with the employee, while the burden of proving that it was paid rests with the employer.

Overtime pay

Under Article 63 of the Labour Act, an employee’s working time may not exceed forty-five hours per week. Working hours beyond forty-five fall within overtime. Under Article 41/7, the employee’s consent must be obtained for overtime work.

Daily working time may not exceed eleven hours. Work exceeding eleven hours in a day counts as overtime even where the weekly total does not exceed forty-five hours. Night work may not exceed seven and a half hours; night work beyond that limit likewise counts as overtime even where the weekly total is not exceeded. Under Article 41, overtime is paid at one and a half times the daily rate.

National holiday and public holiday pay

Under Article 47, an employee who does not work on days recognised by law as national or public holidays receives that day’s wage in full. Where the employee works instead of taking the holiday, an additional day’s wage is paid for each day worked. An employee working on a national or public holiday is therefore entitled to two days’ pay.

Weekly rest day pay

The weekly rest day is the twenty-four hour rest to which an employee who has worked, or is deemed to have worked, six days in the week is entitled on the seventh day. For a rest day not worked, the employer must pay that day’s wage in full. An employee who works on the weekly rest day becomes entitled to the day’s wage and, where applicable, to overtime pay.

Claims dependent on termination

Severance pay

The Act lays down specific conditions for entitlement to severance pay.

Being an employee under Law No. 4857. The Act defines an employee as a person working at an employer’s workplace under an employment contract. For the protection of the employee, it makes no difference whether that contract is written or oral; where the start of work predates the contract, seniority is calculated from the date work actually began. Because Article 14 does not treat the work of certain occupational groups as employment, those persons are not employees and cannot receive severance pay. They include those working in sea and air transport; those in agricultural and forestry workplaces employing fifty or fewer employees; all construction work relating to agriculture within the bounds of the family economy; persons working in homes and in handicrafts among members of a family and relatives up to the third degree inclusive, with no outsider involved; domestic workers; apprentices; sportspeople; persons undergoing rehabilitation; and those working in workplaces employing three persons as defined in Article 2 of the Tradesmen and Craftsmen Act.

One year of service. Entitlement requires at least one year of continuous work at the workplace or workplaces of the same employer. An employee who has worked less than one year cannot receive severance pay. Where the employee has worked at different workplaces, or even different companies, of the same employer, all of that service is taken into account in calculating the one-year period. As noted above, where the employee actually began work before the contract was drawn up, seniority is calculated from the date work began.

Justified termination. A further requirement is that the contract be of indefinite duration, whether written or oral. An employee working under a fixed-term contract cannot claim severance pay at the end of the term. Fixed-term contracts are made in writing between employer and employee for particular work or for the completion of a particular task. Although the minimum period may be as short as one day, no maximum is specified. Fixed-term contracts end automatically on completion of the work or on the occurrence of the agreed condition, and no entitlement to severance pay arises on such automatic termination. However, where a fixed-term contract is terminated before completion of the agreed work — by the employer without justification, or by the employee with justification — the employee becomes entitled to severance pay.

Notice pay

Under Article 17, notice of termination must in principle be given to the other party in writing. The notice periods are:

  • two weeks for service of up to six months;
  • four weeks for service from six months to one and a half years;
  • six weeks for service from one and a half to three years;
  • eight weeks for service exceeding three years.

An employer who terminates without giving notice is obliged to pay the employee the wage corresponding to those periods as notice pay.

No notice pay is payable, however, where the employer terminates during the probationary period or on the grounds set out in Article 25 of the Act.

Annual leave pay

Annual leave is a right allowing an employee who has worked for a year to rest, the pay for the period not worked being made in advance. The right to paid annual leave cannot be waived.

Under Article 53, employees who have worked at least one year from the day they started work, including the probationary period, are granted paid annual leave. The length is determined by length of service:

  • fourteen days for service of one to five years, inclusive;
  • twenty days for service of more than five and less than fifteen years;
  • twenty-six days for service of fifteen years or more.

For employees aged eighteen or under and those aged fifty or over, however, paid annual leave may not be less than twenty days.

Bad-faith compensation

Under Article 18, where the employment contract of an employee falling outside the scope of the job-security provisions in Articles 18 to 21 is terminated by the employer through abuse of the right of termination, compensation equal to three times the notice period is payable.

Where the employee has the possibility of reinstatement — that is, where they fall within the job-security provisions — bad-faith compensation does not arise. The Court of Cassation has held that reinstatement compensation and bad-faith compensation cannot be claimed at the same time.

Frequently Asked Questions

What are the conditions for severance pay?

The employee must have worked for the same employer for at least one year and the contract must have ended on one of the grounds set out in the Act. Compensation is paid at the rate of thirty days’ gross wage, inclusive of benefits, for each full year.

What is notice pay?

A party who terminates the employment contract without observing the notice period pays the other party compensation equal to the wage for that period. Notice periods range from two to eight weeks depending on length of service.

How is overtime calculated?

Weekly working time may not exceed forty-five hours; hours beyond that count as overtime. Daily work over eleven hours, and night work over seven and a half hours, also count as overtime even where the weekly limit is not exceeded. Overtime is paid at one and a half times the daily rate.

The information on this page is general in nature and does not constitute legal advice. Please contact our office for an assessment of your specific matter.

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The information on this page is general in nature and does not constitute legal advice. Please contact our office for an assessment of your specific matter.

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