The main rules regulating employment relationships in Turkey are the laws. While the key areas are regulated by law, the executive body carries out practical measures to implement the laws. The executive body exercises this authority through regulations, legislation and Council of Ministers’’ decisions.
While judicial opinions, the constitution, and international agreements are also sources of employment law, employment agreements, internal regulations, and workplace practices can be named as private sources.
This guide covers the basic issues regulating employment relationships, taking Employment Law number 4857 (the “Employment Law”) as the basis.
I. ESTABLISHING EMPLOYMENT RELATIONS AND EMPLOYMENT AGREEMENTS
A. Definition of Employment Agreement
Article 8 of the Employment Law defines an employment agreement as an agreement formed between two parties whereby one party (the employee) undertakes to perform work in subordination to the other party (the employer) who undertakes to pay the remuneration.
According to this provision, in order to be valid, the employment agreement should include the following elements:
- The performance of work
- The payment
- The employee’s dependency on the employer
The work to be performed could be any activity of a real person, whether physical, intellectual, technical, artistic, scientific, or otherwise.
The payment must be made in exchange for such performance / service of the employee. Even though payment is essential, the Court of Appeal states that the amount to be paid does not have to be specified under the employment agreement. In other words, unpaid work will not constitute a valid employment agreement; however, the agreement will still be regarded as valid even if it does not include the amount to be paid. In later cases, the employer is obliged to pay an amount based on that paid to preexisting employees.
As stated above, the employee must depend on the employer. The employee works within the workplace of the employer (or where the employer instructs and/or allows) and under their supervision. The employee is also obliged to comply with the employer’s instructions. These are some of the key elements regarding the dependency of the employee. It must also be noted that the level of the dependency principle may vary for each agreement and employee and should be evaluated independently.
B. Entering into the Employment Agreement
1. Requirements of the Agreements
Principally, in accordance with article 8 of the Employment Law, there is no special requirement for an employment agreement unless otherwise specified. The employee and the employer may agree upon the terms and conditions of the work either verbally or in writing.
However, if the duration of the employment agreement has been determined as one year or longer, the contract will then have to be in written form. Additionally, article 11 of the Employment Law states that all “definite term employment agreements” must be in written form, regardless of their duration.
Furthermore, the Law on Compulsory Use of Turkish Language states that all employment agreements must be made in the Turkish language if they are executed by and between Turkish citizens and companies incorporated under Turkish law. Therefore, written employment agreements should be drafted either solely in Turkish or as dual column. For dual column agreements, the Turkish version will prevail in the event of any inconsistencies with translated versions.
2. Invalidity of the Contract
Although employment agreements are subject to the freedom of contract principle, there are three main reasons they can be deemed invalid. Article 27 of the Turkish Code of Obligations sets forth these reasons as:
If an employment agreement is against the law, the prohibitive provisions of law, public order or personal rights, it will be deemed invalid. To give an example, if an employment agreement is drafted in another language rather than Turkish, parties will then have the right to claim its invalidity.
If either the execution, commitment, or purpose of the employment agreement is immoral, it will be deemed invalid.
If the subject of an employment agreement is objectively impossible for everyone at the time, such agreement will be deemed invalid.
There are no clear provisions in the Employment Law regarding whether the agreement will be deemed invalid retrospectively from its beginning or after its invalidity has been claimed. The Court of Appeal has stated that employment agreements will mainly be deemed invalid prospectively. However, it must be emphasized that if the employment agreement constitutes a serious violation of law or morality, or disrupts the public order, then it will be deemed invalid with effect from the start. Counterfeiting and smuggling are examples of such acts.
On the other hand, if a party deliberately enters into an agreement in bad faith, knowing that the agreement is invalid due to any of the above reasons, such party can no longer claim invalidity.
3. Trial Period
Parties to the employment agreement may agree upon a trial period in order to evaluate each other. The employer may want to inspect the employee’s manner of work, while the employee may want to evaluate the workplace and conditions. The great majority of employment agreements in Turkey include such provisions even though it is not mandatory to do so.
Trial periods cannot be longer than two months as per article 15 of the Employment Law. However, for collective employment agreements, this period can be extended up to four months. If parties decide upon a longer trial period, such a provision shall be deemed partially invalid and the period will be executed as two months.
Within such a trial period, parties may terminate the agreement without any obligations or granting any notice. However, employers will still be obliged to pay employees’ wages for the days they worked.
Lastly, the calculation of the rights of the employee regarding seniority must include the trial period. For example, the trial period must be taken into account when calculating the employee’s severance payment or annual leave.
C. Types of Individual Agreements
There are many types of employment agreements which parties may agree upon freely in accordance with their needs, within the legal boundaries.
The main types are:
Fixed–Indefinite Term Agreements
A fixed-term agreement is an agreement between an employee and an employer, where the parties mutually agree upon a certain expiration time.
To enter into a fixed-term employment agreement, the practical conditions of the work must be suitable as per article 11 of the Employment Law and the agreement must be in written form. Otherwise, the agreement will be considered as an indefinite-term employment agreement, even if the parties decide upon a certain period of time.
Specifically, fixed-term employment agreements can be executed (i) if the work subject to the agreement has a definite term, (ii) if the work requires the completion of a definite task (such as a project), or (iii) if the work is in connection with the launch of a new project.
An indefinite-term employment agreement can be regarded as the most commonly used type. A fixed-term employment agreement is an exception, since the former provides better protection for employees.
Furthermore, fixed-term employment agreements cannot be renewed without a valid reason. If the parties renew the agreement without objective reasons justifying the renewal, the agreement will be deemed as an indefinite-term employment agreement from the very beginning.
The employer should comply with the equal treatment principle for employees subjected to different agreements, in line with article 5 and article 12 of the Employment Law. However, the employer has the right to treat employees differently due to valid reasons such as seniority, qualifications or the nature of the work.
If employer violates the equal treatment principle without a valid reason, employees can claim compensation for unlawful deprivation of rights and request equality in working conditions with other employees i.e. indefinite term employees
It is possible for the parties to enter into an employment agreement for part-time jobs. Article 13 of the Employment Law states that if the employee’s weekly working hours are significantly lower than the exemplary full-time employee, the employment agreement will be regarded as a part-time employment agreement.
It has been determined within article 6 of the Working Hours By-Law with Regard to the Law that working up to two-thirds of an exemplary full-time job will be deemed as part-time.
Similar to fixed-term employment agreements, the employer is again under the obligation to treat part-time employees and full-time employees equally and cannot treat employees differently without a valid reason. Employees again have the right to claim rights and wages that they were deprived of. Additionally, part-time employment agreements may also be determined for a definite or an indefinite term.
As per article 10 of the Employment Law, works completed within 30 days are regarded as discontinuous, while works lasting more than 30 days are defined as continuous.
However, the time that the work will take is calculated objectively and based on its nature. Therefore, if a work that can be completed within 10 days takes two months, it would still be regarded as discontinuous. Similarly, if a work that can only be completed in two months, is completed within 10 days with extra hours and shifts, it would still be deemed continuous.
D. Other Sources of Employment Relations
Employment Law sources are categorized as follows:
Internal Regulations of the Compan
These regulations are issued solely by the employer, without consulting or negotiating with the employee. Therefore, for internal regulations to be valid, the employee must clearly be informed about these rules while the agreement is being drafted, and must accept and approve them
Additionally, internal regulations cannot be immoral, or be against good faith or aggravate the position and/or obligations of the employee.
Even if regulations are binding and valid, substantial provisions cannot be altered to the detriment of the employee, without prior written notice.
Certain repeated actions by employers may constitute a workplace practice. To give an example, if the employer provides travel expenses or bonuses or other additional social benefits, even though they are not specified in the employment agreement or internal regulations, these actions will constitute a workplace practice.
However, the employer should provide such benefits to all employees, or a part of them, for an action to become a workplace practice. If these benefits are provided to a certain employee, then it cannot be regarded as a workplace practice and the employer would not be obliged to provide these to other employees.
Abandoning such a practice may be regarded as a material change. In such a case, workplace practices cannot be discontinued without prior written notice to the employee, and the employee’s written consent must also be obtained.
Instructions of the Employer
Provided that they are not against the Employment Law or the employment agreement, the employer has the right to give instructions in order to carry out the work and to regulate employees’ behavior.
In parallel, the employee is obliged to comply with valid instructions of the employer.
II. REGULATION OF WORKING CONDITIONS
Article 32 of the Employment Law states that the employer shall pay employees on a monthly basis, at least. The payment period can be reduced to a week under collective bargaining and employment agreements.
In the monthly payment system, employees get paid collectively once a month. The payment amount is calculated by collecting the hours and days in which the employee has worked and/or is considered to have worked.
The payment shall only be made in the form of money and cannot be made by a bill to order (bond), coupon, or a bill claiming to represent the currency of the country or by any other instrument.
Pursuant to article 32 of the Employment Law, the payment shall be made in the Turkish currency, in principle. If parties agree on payment in a foreign currency, it can be paid in Turkish Lira according to the exchange rate on the date of payment.
As per article 401 of the Turkish Code of Obligations, the employer is obliged to pay the employee the amount determined in the agreement. If the agreement does not include such a provision, the employer is obliged to make an equivalent payment that cannot be less than the national minimum wage.
National Minimum Wage
Under article 39 of the Employment Law, the relevant commission of the Ministry of Labor and Social Security determines and revises the minimum wage twice a year.
The national minimum wage applies to all employees except those working in the coal and lignite mining sectors. In these sectors, the minimum wage must be at least twice the regular minimum wage determined by the commission.
The gross minimum monthly wage in force until 31 December 2020 is TRY 2,943.
Deductions of Fines from Payment
As per article 38 of the Employment Law, no employer may impose a fine on an employee’s payment for reasons other than those indicated in the collective agreement or the employment contract. The employee must be notified at once of any payment deductions as fines, as well as the reason for them.
Deductions made in this way must not exceed three days’ payment in any one month, or in the case of piece work or the amount of work to be done, the wages earned by the employee in two days.
These deductions shall be credited within one month to the account of the Ministry of Labor and Social Security in a bank established in Turkey and must be designated by the Ministry for use in the training of and social services for employees. Every employer must maintain a separate account in his establishment showing such deductions. It is against the law to deduct money from the fee and deposit it in the employer’s account.
In accordance with article 102 of the Employment Law, employers who unlawfully impose a penalty shall be penalized with an administrative fine of TRY 1050.51 for 2020.
B. Social Rights and Side Benefits of Employees
Salary, social security contributions, paid annual leave, paid sick leave, general health insurance contribution, weekends, public holidays, official holiday salaries, overtime payments, maternity leave and paternity leave pay are the main mandatory benefits. The employer may also provide employees with some additional voluntary benefits.
Informing the Social Security Institution
Under the social security laws, each employee is insured from the first day of work. The employer must inform the Social Security Institution about each employee that works in its workplace.
Restrictions on Working Hours
The working hous include not only the period in which the worker is actively working but also the period from the moment the worker goes under the order and instruction of the employer until the end of the shift.
The weekly working hours are fixed as 45 hours, and unless otherwise agreed, this period shall be applied equally across the working days of the week. The parties may determine daily working hours for each day, not exceeding the weekly working hours. However, according to the law, the daily working hours cannot exceed 11 hours.
a) Short Work
The general rule of working hours in the Employment Law aims to protect the employee’s health and ensure the quality of work. Carrying out overtime work in workplaces where short work is compulsory is forbidden, as is employing these workers in any job after their daily working time.
b) Periods Considered as Working Time
Article 66 of the mployment Law stipulates that some of the time spent at work will be counted as daily working time.
The following periods shall be considered as the employee’s daily working hours:
- The time required for employees employed in mines, stone quarries or any other underground or underwater work to descend into the pit or workings or to the actual workplace and to return to the surface,
- Travelling time, if the employee is sent by the employer to a place outside the establishment,
- The time during which the employee has no work to perform pending the arrival of new work but remains at the employer’s disposal,
- The time during which the employee who ought to be performing work within the scope of his duties in the establishment is sent on an errand for his/her employer or is employed in the employer’s household or office, instead of performing his/her own duties,
- The time allowed for a female employee who is a nursing mother to enable her to feed her child,
- The time necessary for the normal and regular transportation of groups of employees engaged in the construction, maintenance, repair and alteration of railways, roads and bridges to and from a workplace at a distance from their place of residence.
- Time for transportation to and from the establishment which is not a requirement of the activity but is provided by the employer solely as a form of amenity shall not be regarded as part of the statutory working time.
As per article 41 of the Employment Law, overtime is defined as the time which exceeds 45 hours per week, under the circumstances stipulated under the law.
As per article 63 of the Employment Law, weekly working hours can be distributed over the working days in a week by the mutual agreement of the parties, provided that a maximum of 11 hours per working day is not exceeded. In this manner, the weekly average working time of the employee within a period of two months cannot exceed the regular weekly working time. The reference period can be increased up to four months under collective bargaining agreements. Provided that the average working hours of the employee do not exceed regular weekly working hours, even though they may exceed 45 hours during some weeks, it is not considered to be overtime, if the two-month reference applies in accordance with article 63.
Extra wages for each overtime hour shall be paid as 50% more than the regular working hour salary.
If the weekly working hours are determined to be less than 45 hours in the employment agreement, working hours which exceed the applied average time within the abovementioned conditions, up to 45 hours, are considered to be overtime work. Extra wages for each overtime work hour shall be paid as 25% more than the regular working hour salary.
Employees who do overtime are entitled to take free time of 1.5 hours for each hour of overtime, instead of receiving increased wages as explained above. The employees should use this free time during their working hours within a six-month period and without any deductions from their salary.
The written consent of employees must be obtained each January if they are asked to do overtime. In accordance with article 102/c of the Law, employers may be subject to an administrative fine amounting to TRY 417 for each employee where there is no approval for overtime work.
It can be agreed under an employment agreement that the wages for overtime of up to 270 hours in one year are included in the employee’s salary. For any hours exceeding this limit, the employer is obliged to make an overtime payment to the employee. If the employer does not pay the employee’s wage for the excess hours, there is the risk that the employee may claim compensation from the employer for exceeding hours within five years starting from the relevant overtime work.
Per article 102 of the Employment Law, the employer shall be fined an administrative fine of TRY 511.16 as of 2020 for each employee who has not been paid overtime, who has not been granted the free time he deserved within six months, and who has worked extra hours without his approval.