Measures Launched By Regulation No. 7244 On Turkish Employment Relations Due To Covid-19 (Corona Virus) Pandemic – Coronavirus (COVID-19)

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As part of the measures taken due to the COVID-19 pandemic in accordance with the Law to Reduce the Impact of the Novel Coronavirus Pandemic (COVID-19) on Economic and Social Life and the Law Amending Certain Laws No. 7244 published in the Official Gazette No. 31102 of April 17, 2020 (“Law No. 7244“) it offers new measures for industrial relations. In this context we will discuss the new rules that will be introduced below:

1. Employer does not terminate employment contracts for three (3) months, with the exception of violations of the Code of Ethics and Goodwill

The aim was to provide temporary employment security in accordance with Article 10 of Labor Law No. 4857 (“Employment Law”) with Article 9 of Law No. 7244. Regardless of whether it falls under the Labor Code or not, the employer cannot terminate the contract for three (3) months from April 17, 2020 to July 17, 2020 in this context. “notice period“) with the exception of dismissals resulting from the employee’s behavior that violates the rules of ethics and goodwill and similar cases in Article 25, paragraph (II) of the first paragraph of the Labor Code and the respective provisions of the other law. The President is entitled to extend the notice period by up to six (6) months.

In addition, we would like to point out that, according to provisional Article 23, the Unemployment Insurance Act No. 4447 (“Law No. 4447“) with the Act Amending Certain Acts No. 7226 (“Law No. 7226”), published in the (repeated) Official Gazette No. 31080 of March 6, 2020, stipulates that employers who want to benefit from the short-time work allowance must comply with the ban on dismissal during short-time work. According to the above-mentioned provision, introduced by Law No. 7244, employers who do not receive short-term work allowances also fall within the scope of the dismissal clause, without any distinction being made.

1.1 What are the consequences of terminating the employment contract by the employer in contrast to the ban on dismissal?

The employer or employer representative who terminates the employee’s employment contract contrary to the ban on dismissal will be imposed an administrative penalty in the amount of the minimum gross monthly salary per employee on the termination date. The minimum gross monthly salary set for 2020 is TRY 2,943.00. In addition to the applicable administrative penalty, any dismissal by employers within these time limits will be deemed invalid and employers may be required to pay reinstatement compensation, severance pay and termination allowance.

If the employer terminates the employee’s employment contract contrary to the prohibition on dismissal, the employer is not entitled to apply for short-term work allowance, which is regulated in Law No. 4447.

2. The employers are entitled to unilaterally send the employee on unpaid leave during the period of the ban on dismissal

According to the Labor Code, the employer cannot request unpaid leave based on his own decision. Accordingly, for legally valid unpaid leave, a mutual written agreement on such unpaid leave should be made between the employment relationship and the employer, or the employer should offer the employee unpaid leave and obtain that employee’s written approval for within six (6) working days applying for unpaid leave.

Under Law No. 7244, the above rule has been temporarily changed during the notice period, and it has been regulated that employers can decide, in whole or in part, to unilaterally send their employees on unpaid leave without the consent of the employee. In addition, it was regulated that the fact that the employer sends an employee on unpaid leave does not give the employee the right to terminate his employment contract for good cause. Therefore, under the new regulation, the employer is entitled to unilaterally decide to send workers on unpaid leave during the dismissal ban, and workers cannot terminate the employment contracts, as this situation represents significant changes in working conditions.

3. Financial assistance is given to employees

3.1. Conditions for the provision of financial assistance

As part of the new measures introduced by Law No. 7244, taking into account the possible impact of such a pandemic, provisional Article 24 has been incorporated into Law No. 4447 in addition to the prohibition on terminating employment contracts for three (3) months provide employment security for workers.

Pursuant to Provisional Article 24 added to Law No. 4447, the workers listed below receive unemployment insurance benefits of TRY 39.24 per day while they are on unpaid leave or unemployed for periods of non-dismissal are provided they are not receiving a pension from a social security organization:

• Employees who have been given unpaid leave by their employer in accordance with Article 10 of the Labor Code and who cannot benefit from the short-term work allowance; and
• Workers covered by Article 51 of Law 4447, whose employment contracts are terminated after March 15, 2020 and who cannot receive unemployment insurance benefits.

Payments are not subject to any deduction, with the exception of stamp duty.

3.2. Employees who have been put on unpaid leave will continue to benefit from general health insurance

According to Article 67 of the Social Insurance and General Health Insurance Act No. 5510 (“Law No. 5510“) it is not possible to use general health insurance benefits for employees who have been placed on unpaid leave, and this unpaid leave period is more than thirty (30) days, with the exception of those defined as unpaid leave in Article 56 Periods and 74 of the Labor Code and other labor laws In order to protect workers’ general health insurance rights, they must either pay their social security premium or apply to the Social Welfare and Solidarity Foundation for an income test at their place of residence.

However, Law No. 7244 regulated this problem in line with the Unpaid Leave Regulation, according to which an employee who does not have general health insurance and cannot benefit from the insurance of another person as a dependent is considered to be the holder of general health insurance under Article 60 ( 1) (g) of Law No. 5510 and its related insurance premiums are paid by the Unemployment Insurance Fund.

3.3. Employers cannot continue to actively employ employees who are given unpaid leave and benefit from monetary financial aid

If it is found that the employee benefiting from the financial assistance is actually physically employed by the employer during his unpaid vacation, an administrative penalty will be imposed on the employer equal to the minimum gross monthly salary per person per employee per month in effect on the violation date, plus the salary support paid will be collected by the employer plus the statutory interest accrued from the payment date of the salary support.

3.4. Deadline for applying for financial assistance

Financial assistance is granted to employees during their unpaid vacation or unemployment, but in no case may it exceed the notice period mentioned above. In the event that the notice period is extended by up to six (6) months by decision of the President, the implementation period of the monetary grant will be automatically extended.

4. Short-term compensation is granted without waiting for eligibility assessment and confirmation

The number of short-term work requests from employers that have come into force to reduce the economic impact of the coronavirus pandemic is increasing day by day. Because of this intensity, there are reasonable delays in completing the eligibility assessment carried out by the labor inspector. This raises concerns about the consequences of employers’ application and raises question marks in people’s minds about the implementation of short-term work requests.

In this regard, according to the addition of provisional Article 25 to Law No. 4447 with Article 8 of Law No. 7244, short-term work allowances are granted in accordance with the employer’s declaration, without waiting for completion of the aptitude test for the short-term work requests for compelling reasons that arise resulting from COVID-19 of the employer. This situation paves the way for faster payment to the insured employees under the short-term work allowance, and possible negative outcomes are relieved.

Please note that overpayments and improper payments due to incorrect information and documents provided by employers will be collected from the employer along with interest. It is therefore particularly important to make correct declarations and to agree working hours according to this declaration, taking into account the legal consequences of the inadmissible declarations and requests. These changes to the short-term work requests came into effect retrospectively on February 29, 2020

5. CONCLUSION

As part of the measures taken in response to COVID-19, significant changes have been made to the prohibition on dismissal, application for unpaid leave, salary support, application for short-term work allowance and extension of certain deadlines, which is why it is very important to comply such regulations by employers.

The content of this article is intended to provide general guidance on the subject. A professional should be obtained about your particular circumstances.