One of the founding purposes of labour law is to protect the employee economically and socially by balancing the difference in power between the parties. To that end, the Labour Act No. 4857 introduced the job security provisions, which subject termination to defined rules and reviewable criteria. Job security is a regime of protection intended to prevent the employer from bringing the contract to an end as it pleases, that is to say without relying on a valid reason.
The contract of an employee falling within this scope may be terminated by the employer only by showing a valid reason. Where no such reason exists, or where the termination has not been carried out in accordance with the proper procedure, the act may be treated as invalid; the employee may bring a reinstatement action and seek to return to his or her post. In the course of the process, significant claims such as compensation for failure to reinstate and pay for the period spent out of work also arise.
In this briefing note we examine the concept of job security, the conditions for benefiting from the protection, the rights conferred on the employee, and the reinstatement process followed where a termination is invalid, in all its aspects.
The Legal Framework of the Concept
Job security is an institution of labour law which seeks to prevent the employment contract from being brought to an end by the employer arbitrarily or without a valid reason, and which affords the employee protection under defined conditions. This regime does not remove the employer’s power of termination altogether; it ensures that the power is exercised only in accordance with defined rules and on valid grounds.
In Turkish labour law the relevant provisions are contained in Articles 18 to 21 of the Labour Act No. 4857. Under those provisions the contract of an employee within the scope of the protection may be terminated only on a valid reason arising from the employee’s capability, from his or her conduct, or from the requirements of the undertaking, the workplace or the work.
In this respect the institution seeks to protect the employee’s legal and economic security within the employment relationship, while subjecting the employer’s power of termination to objective and reviewable criteria.
The Conditions for Benefiting from the Protection
The job security provisions of the Labour Act No. 4857 do not apply to every employee. The legislature has required a number of conditions to be present together before the protection can come into play. Where those conditions are not met, no possibility of bringing a reinstatement action arises.
In order to benefit from the protection, the following conditions must be satisfied together.
The Employment of at Least 30 Employees at the Workplace
The application of the provisions depends upon the employer employing a total of 30 employees in one or more workplaces within the same branch of activity. In determining that number, regard is had not only to the employees at the workplace where the termination took place but to the total number of employees employed by the employer in all its workplaces within the same branch of activity.
In the practice of the Court of Cassation it has likewise been accepted that all workplaces within the same branch of activity must be considered together in determining the scope of the protection.
In establishing the number, no distinction is drawn between employees working under fixed-term or indefinite-term, full-time or part-time, permanent or seasonal contracts. It is sufficient that, as at the date on which the notice of termination was given, the contract of the person to be included in the count of 30 employees was continuing; it is not additionally required that the person be actually working at the workplace.
Moreover, according to the practice of the Court of Cassation, since the provisions defining the scope of the protection are relatively mandatory in character, it is possible to lower that threshold in the employee’s favour by means of a collective labour agreement.
At Least Six Months’ Service
In order to benefit from the protection, the employee’s service with the employer must have completed at least 6 months. In the calculation, periods spent at different workplaces of the same employer are assessed together. In addition, where there has been a transfer of the contract or of the workplace, or where a sub-employer relationship exists, earlier periods of work may also be added to the length of service, subject to certain conditions.
By contrast, the condition of 6 months’ service is not required in respect of employees working underground.
Working Under an Indefinite-Term Contract
These provisions apply only in respect of persons employed under an indefinite-term employment contract. Since fixed-term contracts come to an end automatically as a rule upon the expiry of the term, the protection does not come into play in respect of them.
Where fixed-term contracts are concluded in a chain without any objective justification, however, the contract may be treated as one of indefinite term. In such a case the employee may benefit from the job security provisions.
Not Holding the Position of Employer’s Representative
The statute excludes from the scope of the protection certain senior executives holding the status of employer’s representative at the workplace. Accordingly:
- employer’s representatives who direct and manage the undertaking as a whole,
- employer’s representatives who direct and manage the workplace as a whole and who in addition hold the power to engage and dismiss employees
may not benefit from these provisions. By contrast, managers or executives who do not bear the characteristics listed may be regarded as falling within the scope of the protection where they satisfy the other conditions.
The Obligations of the Employer
Bringing to an end the contract of an employee within the scope of the protection has been made subject to defined rules so far as the employer is concerned. Although the power of termination has not been removed altogether, its exercise in accordance with the reason and the procedure prescribed by statute has been made mandatory.
There are obligations with which the employer must comply when terminating the contract of an employee within the scope of the protection. Where these are not observed, the termination may be treated as invalid and a right to bring a reinstatement action arises. Depending on the type of termination, severance pay, notice pay and other employee claims may also be claimed.
The Requirement to Rely on a Valid Reason
The most fundamental obligation imposed on the employer is that the termination be based on a valid reason.
Under Article 18 of the Labour Act No. 4857, the employer may bring the contract of an employee within the scope of the protection to an end only by relying on:
- the employee’s capability,
- the employee’s conduct,
- the requirements of the undertaking, the workplace or the work
as a valid reason arising therefrom. A valid reason, while not as grave as a just cause, denotes objective circumstances which make the continuation of the employment relationship unreasonably difficult from the employer’s point of view.
The statute also expressly provides that certain matters may not constitute a valid reason. By way of example:
- union membership or participation in trade union activities,
- the bringing of an action or the making of a complaint against the employer in order to pursue one’s rights,
- discriminatory grounds such as race, colour, sex, marital status, family responsibilities, pregnancy, childbirth, religion, political opinion and the like
do not constitute a valid reason for termination. A termination not based on a valid reason may therefore be treated as invalid in law.
For further detail on this subject, reference may be made to our note entitled In Which Cases May the Employer Terminate the Contract for Just Cause?
The Notice of Termination Must Be Given in Writing
When bringing to an end the contract of an employee within the scope of the protection, the employer is obliged to give notice in writing. Under the Labour Act No. 4857, that notice must:
- be drawn up in writing,
- state the reason for termination clearly and precisely
Where the notice is not given in writing, or the reason is not stated clearly, the termination may be treated as invalid on procedural grounds even though it rests on a valid reason.
The Obligation to Obtain the Employee’s Defence
A further obligation of the employer is to obtain the employee’s defence in certain cases.
Under the Labour Act, the employer must obtain the employee’s defence before bringing the contract to an end on grounds relating to the employee’s conduct or performance. By contrast, where the termination arises from:
- the requirements of the undertaking,
- the workplace,
- or the work
there is no obligation to obtain a defence. Where a defence ought to have been obtained and that step is omitted, the act may be characterised as an invalid termination.
The Rights Conferred on the Employee
The job security provisions establish a regime of protection intended to prevent the contract from being brought to an end by the employer arbitrarily or without a valid reason. Through these provisions the power of termination has been made subject to defined rules, and the possibility of benefiting from various rights has been afforded where the employment relationship is brought to an end unlawfully.
Where the contract of an employee within the scope of the protection is terminated without a valid reason, possibilities arise such as bringing an action seeking reinstatement, being taken back into work, claiming pay for the period spent out of work, and becoming entitled to compensation for failure to reinstate.
The Right to Bring a Reinstatement Action
Where the contract of an employee who benefits from the protection has been brought to an end without reliance on a valid reason, an action may be brought seeking a declaration that the termination is invalid and seeking reinstatement.
Under the Labour Act No. 4857, the employee must apply to a mediator within one month of the notice of termination being served on him. Where the negotiations produce no result, an action may be brought within two weeks following the date on which the final record was drawn up.
If, at the end of the proceedings, it is established that the termination did not rest on a valid reason, the court will rule that the termination is invalid and that the employee is to be reinstated.
For further detail on this subject, reference may be made to our note entitled The Reinstatement Action.
The Right to Be Taken Back into Work
Where the court rules that the termination is invalid and orders reinstatement, the employee must apply to the employer within ten working days following the judgment becoming final and state that he wishes to return to work.
If the application is made within the period, the employer becomes obliged to take the employee back into work within one month. Where that obligation is discharged, the employee is taken back into his former post or into an equivalent position and the employment relationship continues from where it left off.
Where the application is not made within the period, the termination is treated as valid and the rights afforded by the reinstatement judgment cannot be relied on.
Pay for the Period Spent Out of Work
Following a reinstatement judgment, the employee may claim, in respect of the period up to the judgment becoming final, pay for the period spent out of work and the other entitlements accruing over that period, not exceeding four months.
This claim is a wage to which the employee is entitled by statute even though no work has actually been performed. For the period in question, bonuses, gratuities and similar monetary entitlements are also taken into account alongside the wage.
Pay for the period spent out of work is a head that must be paid by the employer irrespective of whether work was actually performed.
Compensation for Failure to Reinstate
Where the employee applies within the period after the judgment has become final but is not taken back into work by the employer, the employer becomes liable for compensation for failure to reinstate.
Under the Labour Act No. 4857, the amount of that compensation is fixed at not less than four months’ and not more than eight months’ wages, having regard to the employee’s length of service and the circumstances of the termination.
That compensation is a distinct claim intended to make good the loss suffered by reason of the employee not being taken back into work despite the reinstatement judgment. It is independent of pay for the period spent out of work; the employee may hold both rights together.
The Independent Legal Assessment
In reinstatement disputes, the factors that determine the outcome relate more often to procedure than to substance. A failure to give written notice, the statement of the reason in vague terms, or a failure to obtain the employee’s defence can render invalid even a termination that would otherwise be regarded as valid. On the employee’s side, by contrast, the one-month mediation period and the two-week period for bringing an action are preclusive periods; once missed, they determine the outcome without the merits being reached.
The calculation of the thirty-employee threshold is also more contentious in practice than is commonly supposed. Since the criterion is determined by reference not only to the workplace at which the termination took place but to all the employer’s workplaces within the same branch of activity, files thought to fall outside the scope of the protection are open to reassessment.
In a particular dispute we recommend that the following matters be examined as a priority:
- documenting the number of employees at all the employer’s workplaces within the same branch of activity as at the date of termination
- calculating the six months’ service as a whole in files involving a transfer, a sub-employer relationship or a change of workplace
- verifying whether the reason stated in the notice of termination is clear, precise and incapable of subsequent extension
- completing the step of obtaining the employee’s defence in due form in terminations based on conduct or performance
- investigating whether the termination was discriminatory or motivated by trade union considerations
- calendaring the periods for mediation and for bringing the action so as to prevent the loss of rights
Independent Legal provides advisory services in termination processes falling within the scope of job security, both in the analysis of risk before termination and in the conduct of reinstatement proceedings.