Severance Pay Calculation in Turkish Labor Law: A Comprehensive Guide

Eligibility for severance pay

Article 14 of Law No. 1475 requires at least one year of qualifying service and a statutory termination ground. Employer termination other than under Article 25/II of Law No. 4857, employee termination for just cause under Article 24, and retirement, military service, departure by a female employee within one year of marriage or death require their respective conditions. Not every resignation qualifies.

Amount and ceiling

Thirty days of the final gross wage, including qualifying regular benefits, is calculated for each full service year, with proportionate payment for additional service. The statutory ceiling applicable at termination operates per service year; it is not a single ceiling on the entire payment. There is no general thirty-year maximum service period for this calculation.

Deductions and payment

The nature of the payment, statutory exemptions, stamp duty and any excess over the ceiling must be assessed when calculating net payment. A universal fixed TRY 30,000 tax exemption must not be assumed. An accrued severance entitlement becomes due when employment ends; there is no general thirty-day grace period for the employer.

Disputes and time limits

Mandatory mediation precedes litigation. Additional Article 3 and provisional Article 8 of Law No. 4857 provide the five-year general limitation period and transitional rules for earlier terminations. Preserve termination documents, employment records and evidence of wage components.

Legal basis

1475, Article 14; 4857, Additional Article 3 and Provisional Article 8; 7036, Article 3

Legal information: This article provides general information on Turkish law. The documents, dates and applicable rules of each case require individual assessment.