Information Note on Collective Dismissal Procedure
Article 29 of the Labour Law No. 4857 (‘LL’) regulates collective dismissal of employees and sets out the procedures to be followed and certain notification obligations in case the employer intends to dismiss employees due to economic, technological, structural and similar business, workplace and work requirements. Article 29 of the HR is regulated as follows:
‘Collective dismissal of workers Article 29- When the employer wants to dismiss workers collectively as a result of economic, technological, structural and similar business, workplace or work requirements, he shall notify this at least thirty days in advance in writing to the workplace union representatives, the relevant regional directorate and the Turkish Labour Institution.
The number of workers employed at the workplace
a) If between 20 and 100 workers, at least 10 workers,
b) If between 101 and 300 workers, at least ten per cent of the workers,
c) If 301 or more, at least 30 workers,
Termination of employment on the same date or on different dates within a period of one month pursuant to Article 17 shall be deemed collective dismissal.
The notification to be made pursuant to the first paragraph must contain information on the reasons for the dismissal, the number and groups of workers to be affected thereby and the time period in which the dismissals will take place.
In the negotiations to be held between the workplace union representatives and the employer after the notification, the issues of preventing collective dismissal or reducing the number of workers to be dismissed or minimising the negative effects of the dismissal on the workers shall be discussed. At the end of the negotiations, a document shall be issued showing that the meeting was held.
Termination notices shall become effective thirty days after the employer notifies the regional directorate of the collective dismissal.
In the event of a definitive and permanent closure of the workplace, the employer is only obliged to notify the relevant regional directorate and the Turkish Labour Institution at least thirty days in advance and to announce it at the workplace. If the employer wishes to recruit new employees for the same type of work within six months following the finalisation of the collective dismissal, he shall preferably call those who are qualified for the job.
The employer may not use the provisions regarding collective dismissal to prevent the application of the provisions of Articles 18, 19, 20 and 21; otherwise the employee may file a lawsuit according to these articles.’
In summary; if the number of employees working at the workplace is a) between 20 and 100 employees, at least 10 employees, b) between 101 and 300 employees, at least ten percent of the employees, c) 301 and more employees, at least 30 employees, terminating the employment of at least 30 employees on the same date or on different dates within a one-month period in accordance with Article 17 (termination clause) is considered collective dismissal.
When the employer wants to dismiss workers collectively as a result of economic, technological, structural and similar business, workplace or work requirements, the employer must follow the steps below. IN CASES WHERE THERE IS NO UNION ORGANISATION, THE RELEVANT SECTIONS MAY BE SKIPPED AS THE PROCESSES RELATED TO UNION RELATIONS CANNOT BE FOLLOWED. HOWEVER, OTHER MANDATORY STEPS MUST BE TAKEN.
In case of a collective dismissal, the employer shall notify the workplace union representatives, the relevant regional directorate and the Turkish Labour Institution at least thirty days in advance in writing. The notification must include information on the reasons for the layoff, the number and groups of workers who will be affected, and the timeframe in which the layoff will take place.
After the notification, negotiations shall be held between the workplace union representatives and the employer. In the negotiations to be held, the issues of preventing collective dismissal or reducing the number of workers to be dismissed or minimising the negative effects of the dismissal for the workers are discussed. At the end of the negotiations, a document showing that the meeting was held shall be issued.
Termination notices shall become effective thirty days after the employer notifies the regional directorate of the collective dismissal.
If the employer wishes to recruit new workers for the same type of work within six months of the finalisation of the collective dismissal, he shall preferably call those who are qualified for the job. In such a case, the employee shall be reinstated to his/her former job or to a job similar to his/her former job on the same terms and conditions on which he/she was hired. In this case, in determining the wages and working conditions of the re-employed worker, his/her former wage shall be taken as a basis and if there has been an increase for the workers in the same situation during the intervening period, this shall also be taken into consideration.
The employer may not use the provisions on collective dismissal to prevent the application of the provisions of Articles 18, 19, 20 and 21; otherwise, the employees may file a lawsuit against their employers based on these articles regarding job security.
Provisions regarding collective dismissal shall not apply to employees whose employment contract is terminated automatically (resignation, retirement, death) and whose employment contract is terminated by the employer in accordance with Article 25 of the Labour Law No. 4857.
According to Article 100 of the Labour Law, the employer or employer’s representative who dismisses employees in violation of the provisions of Article 29 of the Law shall be imposed an administrative fine of TRY 1,145 for each employee dismissed in accordance with the tariff for 2021.
The employer, who does not consider the continuation of the activity in the workplace where the employee works to be beneficial or efficient for himself, has the right and authority to make all kinds of savings, including closure, on this workplace in accordance with the right of management. The decision taken by the employer may be based on reasons arising from outside the workplace that make it impossible to continue the business, such as the decrease in release and sales opportunities, decrease in demand and orders, energy shortage, economic crisis in the country, general stagnation in the market, loss of foreign market, shortage of raw materials, as well as the implementation of new working methods, narrowing of the workplace, implementation of new technology, closure of some parts of the workplace and abolition of some types of work. These types of decisions are called operational decisions.
The employer may make legal dispositions regarding the management and organisation of the workplace, arising from the right of management. In this respect, the law enforcement bodies will not be able to audit the appropriateness of this decision, but they can audit the compliance of the process followed in the implementation of the decision with the law. The Court of Cassation has some criteria for the termination of the employment contracts of the employees based on a valid reason after the downsizing decision. In case of a downsizing in accordance with these criteria, the termination is also valid.
Employer must prove that the termination is based on a valid reason
Pursuant to Article 20/2 of the HR, ‘the burden of proof that the termination is based on a valid reason lies with the employer’. While fulfilling the burden of proof, the employer shall first prove that the termination complies with the formal conditions and then prove that the reasons for termination are valid (or justified) in terms of content. (Yrg. 9th HD decision dated 04.04.2008 and numbered E. 2007⁄29752, K. 2008⁄7448)
There must be an Operational Decision that is Audit-Favourable
In order for the judiciary to analyse a valid or invalid termination in many respects, an operational decision is required. This decision is usually a management decision. Therefore, the decision of the board of directors should include a principled approach on what an operational decision is, how the decision has led to a labour surplus, and what should be done to tolerate the labour surplus.
The fact that the situation that leads the employer to consider himself obliged to reduce the number of workers in the workplace is based on an erroneous decision taken by him previously does not invalidate the termination of the employment contract within the meaning of Article 18 of the HR. The fact that the operational decision leading to the termination of the employment contract is not subject to judicial review also applies to erroneous operational decisions. Since the judge cannot control the operational decision, he/she will not control whether it is erroneous or not; therefore, he/she will not be able to decide on the invalidity of the termination on the grounds that the operational decision is erroneous. Operational decisions cannot be subjected to a review of propriety. The fact that the employer can freely take operational decisions and that these decisions are excluded from judicial review as a rule is undoubtedly dependent on the fact that these decisions are taken within the limits stipulated by the legal order. (Decision of Yrg. 7th HD dated 28.01.2015 and numbered E. 2014⁄17074, K. 2915⁄775)
The production reduction must be permanent & the company must really downsize
Downsizing Decision Should Make Termination of the Contract Inevitable
The employee’s ability to work must have been definitively and permanently eliminated. The employer must concretely explain and prove why and how the employee’s ability to work has been eliminated and that the termination is the last resort
Termination should be considered as a last resort
The employer who wants to terminate the contract for reasons arising from the requirements of the enterprise, the workplace and the workplace should use the possibilities to avoid termination before termination, such as eliminating overtime work, shortening the working time with the consent of the employee and developing flexible working methods to the extent possible, spreading the work over time, employing the workers in other jobs, overcoming the problem by retraining the worker, in short, termination should be considered as a last resort. (Yrg. 22. HD decision dated 23.01.2017 and numbered E. 2017⁄829, K. 2017⁄613) Although the closure of the workplace or cessation of activity or downsizing is real and continuous, it cannot be said that the termination is based on valid reason if the employer has another workplace and the employee has the opportunity to be evaluated.
Who will be dismissed due to the downsizing decision must be determined objectively
If there is a rule in the employment contract or collective bargaining agreement on who will be dismissed, this rule should be followed, otherwise, if the decision to be taken determines which workers (e.g. probationary workers, retired workers, workers with the highest number of disciplinary penalties, single workers, married workers without children, etc.) will be dismissed, the workers to be dismissed should be determined by the objective implementation of this decision.
The operational decision must be applied consistently
Consistency refers to the continuous and permanent implementation of the decision taken by the employer. Recruitment of workers immediately before or after the termination shows that there is no consistency.
Attention should be paid to resignation petitions
In the concrete case, there is no doubt that the justification for the reduction of staff due to capacity reduction and downsizing given by the defendant employer as a valid reason for termination is not real, and that the employee’s will has been misused by imposing this justification and making the employee write a petition in his own handwriting…… There is no doubt that the defendant… Airport and … Although he claimed that the position of Technical Manager was abolished in the units other than the airport, it is evident that he could not prove this issue (reduction of staff due to capacity reduction and downsizing) although he advertised for Technical Manager for … and … and relied on the operational decision, and it was erroneous for the court to decide to dismiss the lawsuit instead of accepting it… (Yrg. 7th HD decision dated 15.01.2014 and numbered E. 2013⁄27384, K. 2014⁄331)
Operational Decision is Subject to Consistency, Arbitrariness, Proportionality and Necessity Control
Whether the employer’s decision to close the workplace/branch resulted in excess employment, whether the employer applied this decision consistently (consistency control), whether the employer acted arbitrarily in the termination (arbitrariness control) and whether the termination was inevitable as a result of the operational decision (proportionality control – principle of last resort); In summary, it is investigated whether it was possible to transfer the terminated employee to another department before the termination, whether another employee was replaced after the termination, whether the operational decision was fully complied with, and whether there is another purpose hidden behind the operational decision.
