Job Security and Reinstatement Claims

Job security (iş güvencesi) protects the employee against the termination of an employment relationship of indefinite duration by the employer without a valid reason. The employment contract of indefinite duration of an employee who meets the statutory conditions may be terminated by the employer only for a valid reason arising from the employee's capability or conduct or from the operational requirements of the enterprise, the workplace or the work. An employee who considers the termination to be invalid may take legal action seeking a declaration that the termination is invalid and reinstatement. The following explanations are based on Articles 18 to 21 of Labour Law No. 4857 (İş Kanunu) with regard to employment relationships governed by that Law; special protection regimes, such as those for terminations on trade union grounds and for workplace trade union representatives, remain reserved.

Contents

• What does job security mean in Turkish employment law?
• What are the conditions for benefiting from job security?
• What is a valid reason and how does it differ from just cause?
• Which circumstances constitute a valid reason for termination and which do not?
• Which formal requirements apply to termination?
• What does the principle of termination as a last resort require?
• How does the reinstatement procedure work?
• Who bears the burden of proof?
• What are the consequences of a finding that the termination is invalid?
• Which time limits must be observed?
• Conclusion

What does job security mean in Turkish employment law?

Job security refers to the protection of employees who meet certain conditions against termination by the employer. In this context, when terminating the employment contract of indefinite duration of an employee covered by job security, the employer must rely on a valid reason. Where the termination is not based on a valid reason, the employee may, seeking reinstatement, first apply to mandatory mediation and, if no agreement is reached, take the matter to court. The purpose of the provisions is to prevent arbitrary and unfounded terminations and to strike a balance between the employer's freedom of enterprise and the employee's interest in keeping his or her job.

What are the conditions for benefiting from job security?

Job security does not apply to every employment relationship. Pursuant to Article 18 of the Labour Law, the employment contract must have been terminated by the employer and the following conditions must be met cumulatively:

• The existence of an employment contract of indefinite duration between the parties.
• At least 30 employees are employed at the workplace on the date on which the notice of termination reaches the employee. If the employer has more than one workplace in the same line of business, the numbers of employees at these workplaces are added together. As a rule, employees working under fixed-term or indefinite, full-time or part-time or seasonal employment contracts are counted. In the practice of the Court of Cassation, employees working at the same employer's workplaces abroad in the same line of business are, as a rule, also taken into account; in international groups of companies, the position of separate legal entities is assessed on a case-by-case basis, taking into account the employer structure and any joint employment.
• The employee has at least six months of service. In calculating the six months of service, the periods listed in Article 66 of the Labour Law are taken into account; the employee's periods at one or different workplaces of the same employer are combined. The six-month service requirement does not apply to employees working underground.
• The employee is not an employer's representative or deputy managing the enterprise as a whole, or an employer's representative managing the workplace as a whole and having both the authority to hire and the authority to dismiss employees.

An employee who does not meet these conditions cannot make use of the reinstatement procedure under Articles 18 to 21 of the Labour Law. However, if the employment contract of indefinite duration of an employee outside the scope of job security has been terminated through abuse of the right of termination, bad-faith compensation in the amount of three times the wage for the notice period pursuant to Article 17 of the Labour Law, if its conditions are met, and in addition any unpaid notice compensation may come into consideration. The conditions for job security are assessed on the basis of the date on which the notice of termination reaches the employee.

What is a valid reason and how does it differ from just cause?

Termination for a valid reason is based on reasons arising from the capability or conduct of the employee within the meaning of Article 18 of the Labour Law or from the operational requirements of the enterprise, the workplace or the work. This concept differs from just cause under Article 25 of the Labour Law. Where just cause exists, the employer may terminate the employment contract with immediate effect without waiting for the notice period. However, the employee, as a rule, loses the right to severance pay only in a termination based on cases contrary to morality and good faith under Article 25/II of the Labour Law. In a termination for a valid reason, on the other hand, the notice period is observed or the wage for that period is paid in advance; if the other conditions are also met, the employee is entitled to severance pay. An employee covered by job security may claim that a termination based on Article 25 does not comply with the statutory requirements and file for reinstatement pursuant to Articles 18, 20 and 21 of the Labour Law.

Which circumstances constitute a valid reason for termination and which do not?

Accepted valid reasons

Whether a valid reason exists is assessed according to the particular features of each case. In practice, the following groups are especially significant:

• Reasons relating to the employee: persistently low performance compared with employees doing similar work, declining capability and inability to adapt to the requirements of the job or to develop. It is important that the performance criteria are objective, reasonable and knowable in advance, that the inadequacy is persistent and that the employee is, as a rule, given feedback and a reasonable opportunity to improve.
• Reasons relating to conduct: repeated late arrival, conduct adversely affecting the work organisation or working relationships at the workplace, breach of the employee's ancillary obligations and inappropriate conduct towards customers or colleagues. For these to qualify as a valid reason, the conduct must not be so serious as to warrant termination for just cause. Under the principle of proportionality, an appropriate warning before termination is, as a rule, also required where a repetition of the conduct could be prevented.
• Operational requirements: a decline in turnover and orders, restructuring, closure of departments, automation or economic reasons. For these reasons to constitute a valid reason, they must actually affect the need for labour at the workplace. The existence of an operational decision alone is not sufficient; the decision must be implemented in practice and consistently, there must be a causal link between the decision and the termination, and the termination must be a last resort.

Circumstances that by law do not constitute a valid reason

Pursuant to Article 18 of the Labour Law, the following circumstances do not constitute a valid reason for termination. With regard to terminations on trade union grounds and the protection of workplace trade union representatives, the special provisions of Articles 24 and 25 of Law No. 6356 also apply:

• Trade union membership or participation in trade union activities outside working hours or, with the employer's consent, during working hours
• Acting as a workplace trade union representative
• Filing a complaint against the employer or participating in proceedings in order to pursue statutory or contractual rights
• Race, colour, sex, marital status, family responsibilities, pregnancy, childbirth, religion, political opinion and similar reasons
• Absence from work during the periods in which female employees may not be employed under Article 74 of the Labour Law, and temporary absence due to illness or accident within the waiting period under Article 25/I-b of the Labour Law

Which formal requirements apply to termination?

Pursuant to Article 19 of the Labour Law, the employer must give notice of termination in writing and state the reason for termination clearly and precisely. The reason given cannot subsequently be replaced by another reason; the employer is bound by the reason stated in the notice of termination. If the termination is based on the employee's conduct or performance, the employee's defence must be obtained before the termination decision, with the specific allegations against the employee being disclosed; a termination made without obtaining the defence is deemed invalid on procedural grounds. There is no obligation to obtain a defence in terminations based on the operational requirements of the enterprise, the workplace or the work. Nor is there an obligation to obtain a prior defence with regard to the right of immediate termination in accordance with the conditions for cases contrary to morality and good faith and similar cases under Article 25/II of the Labour Law.

What does the principle of termination as a last resort require?

Under the principle that termination must be a last resort (ultima ratio), the employer must, before resorting to termination, consider less severe measures that could ensure the continuation of the employment relationship. Examples include employing the employee in another position, providing retraining or in-service training, reducing overtime and applying suitable working models. In terminations based on operational requirements in particular, it is also examined whether the operational decision has actually and permanently eliminated the need for labour and whether it has been implemented consistently. Hiring a new employee for the same job shortly after the termination is a factor to be taken into account separately in assessing the validity of the termination. However, the employer is not required to create a new position solely in order to avoid termination. In terminations based on operational requirements, it is also important that the employee whose employment contract is to be terminated is selected according to objective and consistent criteria. A working model that amounts to a fundamental change, on the other hand, requires the employee's written acceptance.

How does the reinstatement procedure work?

For a reinstatement claim, mandatory mediation applies before an action is filed. The procedure works as follows:

Application to mediation: The employee must apply to a mediator with a request for reinstatement within a forfeiture period of one month from service of the notice of termination. In a termination with notice, the period begins not on the date on which the employment contract is to end but on the date on which the notice of termination was served.

Agreement in mediation: If the parties agree on the employee's return to work, they must determine the date of return to work, the monetary amount of the wage and other entitlements for the idle period and the monetary amount of the compensation payable if the employee is not reinstated. Otherwise, no agreement is deemed to have been reached. If the employee does not return to work on the agreed date, the termination becomes valid and the employer is liable only for the legal consequences of a valid termination.

Filing an action if no agreement is reached: If mediation fails, the employee may file an action with the labour court within two weeks of the date on which the final report is drawn up; if the parties so agree, the dispute may instead be referred to a private arbitrator within the same period. If the action is dismissed on procedural grounds because it was filed directly without applying to a mediator, an application to a mediator may be made within two weeks of the ex officio service of the final dismissal decision.

The labour court examines whether the formal requirements have been complied with and whether the reason given actually supports the termination. An appeal against the judgment lies to the Regional Court of Appeal; the appellate court's decision in reinstatement cases is final, and no appeal to the Court of Cassation is available. The procedure is thus designed to be concluded quickly.

Who bears the burden of proof?

Pursuant to Article 20 of the Labour Law, the burden of proving that the termination is based on a valid reason lies with the employer. The employer must set out the reason for termination specifically and prove it. In terminations based on operational requirements, the existence of the operational decision, its effect on the need for labour, its consistent implementation, the causal link with the termination and the absence of reasonable alternatives capable of avoiding termination must be documented. If the employee claims that the termination was in fact based on another reason, the employee, as a rule, bears the burden of proving this claim. The relevant special rules of evidence for allegations of termination on trade union grounds or of discriminatory termination remain reserved. It is therefore important that the employer documents the reason for termination and the facts on which the procedure is based clearly and sufficiently.

What are the consequences of a finding that the termination is invalid?

If the court or the private arbitrator rules that the termination is invalid, the following consequences arise under Article 21 of the Labour Law. The court or private arbitrator determines in monetary terms the compensation for non-reinstatement and the wage and other entitlements for the idle period on the basis of the wage on the date of the action:

Employee's application to return to work: The employee must apply to the employer to return to work within ten working days of service of the final court or arbitral decision. The application must be not only timely but also serious and genuine. If the employee does not apply in time, the termination by the employer is deemed valid and the employer is liable only for the legal consequences of a valid termination.

Reinstatement or compensation: Upon the employee's timely application, the employer must reinstate the employee within one month. If the employer does not reinstate the employee, it pays the employee compensation for non-reinstatement (işe başlatmama tazminatı) in the amount of at least four and at most eight months' wages. The amount of compensation is determined by the court, taking into account the employee's length of service and the reason for termination. In terminations on trade union grounds, the special regime on trade union compensation under Law No. 6356 applies.

Wage for the idle period: Regardless of whether the employee is reinstated following the reinstatement claim, the wage and other entitlements accrued for up to a maximum of four months for the period during which the employee did not work until the decision becomes final are paid. This period is taken into account in calculating the period of service. For these entitlements to arise, the employee must make a timely, serious and genuine application to return to work.

Set-off and wage for the notice period: If the employee is reinstated, the wage for the notice period paid in advance and severance pay are set off against the payments under Article 21 of the Labour Law. If the employee is not reinstated and was not previously given a notice period or paid the wage for that period in advance, the wage for the notice period is paid separately. Depending on the specific case, adding the idle period of up to four months to the period of service may give rise to a severance pay differential.

Which time limits must be observed?

In a reinstatement claim, the time limits provided for in the law must be monitored carefully:

• Forfeiture period of one month from service of the notice of termination: application to mandatory mediation with a request for reinstatement
• Two weeks from the date on which the final report recording that no agreement was reached is drawn up: filing an action with the labour court or, if the parties so agree, applying to a private arbitrator
• Ten working days from service of the final court or arbitral decision: the employee's application to the employer to return to work
• One month from the employee's application to return to work: the period within which the employer must reinstate the employee

Conclusion

In matters of job security and reinstatement claims, it is important for the employer that the reason for termination is valid and capable of proof, that the notice of termination is given in writing and that the reason is stated clearly and precisely. In terminations based on conduct or performance, obtaining the employee's defence, where the conditions are met, and the principle of termination as a last resort must also be taken into account. Failure to comply with these requirements may lead to the termination being deemed invalid.

For the employee, it is important not to miss the time limits provided for in the law. The employer must prove that the termination is based on a valid reason. If the termination is held to be invalid, financial consequences may arise for the employer in the form of compensation for non-reinstatement and the wage and other entitlements for the idle period.

GEMS Schindhelm advises employers on the lawful preparation and implementation of terminations and employees on the pursuit of their rights, and represents both sides in mandatory mediation and labour court proceedings. This article is intended for general information purposes only and does not constitute a legal opinion or legal advice; each dispute must be assessed separately in light of the specific circumstances of the case and the legislation in force.