Turkey Continues to Protect Employees from Effects of COVID-19

Ali Bulut
August 25, 2020

The Turkish government continues to minimize the effects of the COVID-19 pandemic on companies. A Presidential decree has extended the deadline for the Ban on Layoffs and Cash Wage Support from 17 July 2020 until 17 August 2020.

This measure, which protects both employees and employers, is extended until 30 June 2021 and will be reviewed again every three months.

The Ban on Layoffs and Cash Wage Support

With this law, employers can only end employees’ employment contracts due to employees’ violation of ethics and goodwill principles as of 17 April 2020. Termination is only possible in the following scenarios:

  • Resignation by the employee
  • Retirement
  • Marriage
  • Military service
  • Death
  • End of the term of fixed-term contracts

This labor law also allows employers to offer employees whose contracts end after the ban, unpaid leave. However, if an employee decides to take this leave, he can’t benefit from the Short Work Allowance (SWA); instead, he receives cash support of TRY 39.24 per day from the fund provided by the Ministry. Such payments are exempt from all taxes except for stamp tax.

Who can benefit from the Cash Wage Support?  

  • Employees forced to take unpaid leave by their employer and unable to benefit from the SWA
  • Employees whose contracts are terminated in a way that entitles them to take unemployment pay and who can’t claim the unemployment allowance as per other provisions of this law
  • Anyone not eligible to receive an old-age pension from any social security organization.

Employers or employees on unpaid leave can make the applications via the employer system of the Social Security Institution (SSI). Unemployed people can apply via the website of the Institution of Providing Jobs and Employees (İŞKUR).

Key points

Employees who took unpaid leave, or whose labor contracts are terminated, can benefit from the cash wage support. The following dates should be noted:

  • Employees who took unpaid leave after April 2020 and,
  • Whose labor contracts were terminated after March 2020 can benefit from this support.

To benefit from the cash wage support, employees should meet specific conditions as well:

  • They can’t benefit from the SWA
  • They shouldn’t be receiving a retirement pension from any social security institution
  • They should be entitled to unemployment pay. They should be reported to the SSI with the definitions of document types numbered 01, 04, 05, 06, 12, 14, 20, 29, 32, 35, 39, 52, 53, 54, or 55.

The COVID-19 pandemic has had adverse effects on all countries worldwide, including Turkey, both morally and materially. It’s possible that the insurance premiums of employees haven’t been paid regularly or monitored. Such supportive measures as the Ban on Layoffs, Cash Wage Support, and Short Work Allowance have been introduced to minimize these negative impacts and support employees. 

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Ali Bulut

Ali is a Sales Director at Sovos Turkey. Based in Istanbul and originally from Turkey, Ali’s background is in software development and project management mostly related to salesforce applications. Ali graduated from the physics department in science faculty at Istanbul University. Ali has been working on tax regulations since 2013.
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