THE AMENDMENTS TO THE LABOUR LAW AND THE UNEMPLOYMENT INSURANCE LAW WITH THE LAW NO 7244
17 April 2020
Within the scope of the measures taken due to Covid-19 outbreak, the Labour Law No 4857 (the "Labour Law") and the Unemployment Insurance Law No 4447 (the "Unemployment Insurance Law") have been amended with the Law No 7244 published in the Official Gazette dated 17 April 2020 and numbered 31102.
Amendments to the Labour Law
a) Employment and Service Agreements cannot be Terminated for a Period of 3 Months by the Employer
In accordance with the Provisional Article 10 included in the Labour Law, employment and service agreements cannot be terminated by the employer for 3 months starting from 17 April 2020 ("Effective Date"), the date on which this article entered into force, except for cases which do not comply with ethics and good faith principles and other similar reasons indicated under subparagraph (II) of paragraph one of Article 25 of the Labour Law. The President may extend such period up to 6 months.
b) Employer is Entitled to Put Employees on Unpaid Leave
The employer is entitled to put the employees on unpaid leave without the consent of the employees, provided that it does not exceed the 3-month period following the Effective Date. The President may extend such period up to 6 months.
Amendments to the Unemployment Insurance Law
a) Assessment of Eligibility in Short-Time Working Wage Applications
In accordance with the Provisional Article 25 added to the Unemployment Insurance Law, for short-time working applications made by employers due to Covid-19 for compelling reasons, short-time working wages shall be made based on the statements of employers, without waiting for the completion of assessment of eligibility. Any excessive and groundless payments due to the incorrect information and documents provided by the employer will be collected from the employer together with legal interest. This provision will be applicable from 29 February 2020.
b) Employees who are not Eligible for Short-Time Working Wage will Receive a Monetary Support from the Fund
Pursuant to the Provisional Article 24 added to the Unemployment Insurance Law:
- Employees on unpaid leave under the Provisional Article 10 added to the Labour Law,
- Employees who cannot benefit from Short-Time Working Wage,
- Employees whose employment agreements were terminated after 15 March 2020 pursuant to Article 51 of the Unemployment Insurance Law,
- Employees who do not benefit from unemployment allowance under the other provisions of the Labour Law,
shall receive a daily wage in the amount of TRY 39.24 from the Unemployment Insurance Fund through the period in which they are on unpaid leave or are unemployed; provided that it does not exceed the period indicated under the Provisional Article 10 and that they do not receive retirement wage. Within this scope, the persons receiving the relevant support will be considered as General Health Insurance holders.
In case it is detected that the employee who benefits from the monetary support due to unpaid leave is in fact working, an administrative fine shall be imposed on the employer in the amount of gross minimum wage (currently TRY 2,943 (Two Thousand Nine Hundred Forty-Three)) for each employee employed in this manner and for each month in which they are employed. In addition, the monetary support will be collected from the employer together with the statutory interest that will be applied starting from the date of payment.
If you have any questions regarding our note above, please do not hesitate to contact us.
Güner Law Office