Employment Claims Guide: Severance, Notice, Overtime and Annual Leave

Short answer: Employment-law entitlements fall under severance pay (min. 1 year of service + just/valid termination), notice pay (termination without notice period), overtime (work above 45 hours per week), annual leave (compensation for unused leave) and statutory holiday / weekly rest premiums. They are governed by the Labour Code no. 4857, Social Security Act no. 5510 and the Labour Courts Act no. 7036; the limitation period is generally five years for most claims (including severance and notice pay for terminations after 25 October 2017). Mandatory mediation is a condition of suit.

Which employment claims are available?

The main claims arising after termination of an employment contract are:

• Severance pay (kıdem tazminatı) — under art. 14 of the former Labour Code no. 1475, requiring at least one year of service and a just-cause / valid termination.
• Notice pay (ihbar tazminatı) — under art. 17 of Law no. 4857, payable when the employer terminates without observing the notice period.
• Overtime pay (fazla mesai) — 50% premium for each hour over the 45-hour weekly threshold (art. 41).
• Unused annual leave compensation — paid at termination on the basis of the last daily wage (art. 59).
• National-holiday and weekly-rest premiums — premium pay for work performed on these days (arts. 44, 46).
• AGI, bonus, premium — entitlements arising from the contract or established workplace practice.

Severance and notice pay requirements

Severance pay requires at least one year of service and termination either by the employer (other than for just cause attributable to the employee) or by the employee for just cause under art. 24 of Law no. 4857. The calculation is based on 30 days of the last gross wage for each completed year of service, subject to the annually updated ceiling.

Notice pay applies where the employer terminates without observing the statutory notice periods of art. 17 (between 2 and 8 weeks depending on service). The amount equals gross wages for the unused notice period. Notice pay is not available where the employee terminates immediately for just cause.

Overtime and annual leave entitlements

Overtime is work performed above the 45-hour weekly threshold, paid at 1.5 times the hourly wage; weekly-rest work attracts a 100% premium. Employees must in principle give written consent for overtime, and there is a 270-hour annual cap — although exceeding the cap does not extinguish the wage entitlement.

Annual paid leave under art. 53 of Law no. 4857 is at least 14 days (1-5 years of service), 20 days (5-15 years) and 26 days (15+ years). When employment ends, unused leave is paid on the basis of the last wage; leave compensation cannot be requested while the contract is ongoing.

Mediation is a condition of suit

Under art. 3 of the Labour Courts Act no. 7036, mediation is a precondition for filing employment-claim and reinstatement suits. Suits filed without the mediator's final report attached are dismissed on procedural grounds. The process must in principle conclude within three weeks of the mediator's appointment, extendable by one week. A settlement reached before the mediator has the force of an enforceable judgment.

Limitation periods

• Severance and notice pay: 5 years (Law no. 7036, addit. transit. art. 7; for terminations after 25 October 2017).
• Overtime, annual leave, holiday and weekly-rest premiums, AGI, bonuses: 5 years.
• Reinstatement claim: 1 month from service of the notice of termination to apply for mediation; if no settlement, 2 weeks from the final report to file suit (art. 20 of Law no. 4857).
• Service-determination suit: 5 years from the end of the year in which the unreported service was performed (art. 86 of Law no. 5510).

Frequently Asked Questions

Can an employee who resigns claim severance pay?

As a rule, a resigning employee cannot claim severance. Exceptions arise where the employee resigns for just cause under art. 24 of Law no. 4857 (e.g. unpaid wages, harassment, serious health risk), retires, completes military service, or — for women — leaves within one year of marriage; an employee with 15 years of service and 3,600 contribution days may also resign with severance. The just-cause ground must be concretely proven.

How can overtime be proven?

Time-keeping records, electronic entry-exit data, e-mail correspondence, phone records and witness statements are key evidence. Under the Court of Cassation's settled practice, calculations based on witness testimony are subject to discretionary reductions by the trial judge. Where the employer fails to produce records, a presumption operates in favour of the employee.

If I am dismissed unfairly, what suits can I bring?

Employees with at least six months' service in workplaces with 30+ employees can bring a reinstatement (işe iade) suit where termination lacks a valid ground. Outside this scope, employees pursue severance, notice and other claims through a debt action before the labour court. Mediation is mandatory in both routes.

Related pages

• Istanbul Employment Lawyer — main practice page.
• Severance Pay
• Notice Pay
• Reinstatement Suit
• Termination of Employment Contract
• Istanbul Work-Accident Lawyer — for occupational disease and accident compensation.

Legal notice

This guide is for general information purposes only and does not constitute legal advice. Employment claims are assessed in each case on the basis of the specific evidence, contract terms, ground of termination and the legislation in force; no outcome is guaranteed. For advice on a specific matter, contact Av. Burak Koçak via our contact page.