AMENDMENTS PROVIDED BY LAW NO. 7244 PUBLISHED WITHIN THE SCOPE OF COVID-19 PANDEMIC

I. AMENDMENTS IN LABOR LAW;

A. PROHIBITION OF TERMINATION:

Termination of employment contracts are prohibited FOR A PERIOD OF 3 MONTHS from April 17, 2020 to July 17, 2020.

In this period of time, the employer can terminate the employment contract due to existance of just reasons which do not suit with morality and good faith rules defined in Article 25/2 of the Labor Law.

B. RIGHT TO APPLY UNPAID LEAVE:

Employers have become entitled to apply unpaid leave to employees, not to exceed three months, without any consent as of April 17, 2020. Employees have no right to terminate employment contract based on just reasons in the event of unpaid leave.

C. CASH SUPPORT:

With provisional article included in the Unemployment Insurance Law No. 4447, by the omnibus bill 39,24 TL in cash support is decided to be provided per daythroughout the prohibition of termination, to the employees who are made to take unpaid leave by employers and cannot benefit from short work allowance, and the employees who are laid off as of March 15,2020 and cannot benefit from unemployment allowance due to absence of conditions required by the Law.  There will be no deduction from the paid allowance except for stamp tax.

D. APPLICATIONS TO SHORT WORK:

Short work allowance will be rendered without waiting for determination of suitability but based on the declaration of the employers, for the applications based on force majeure purposes in terms of coronavirus (COVID-19). Overpayments rendered because of misinformation or wrong documentation by the employer, are charged to the employer with legal interest.

The amendments regarding short work applications, enters into force, retroactively, as of 29 February 2020.

E.DETAILED INFORMATION:

1) Is it possible for an employee on trial period to be laid off or made to take unpaid leave?

Omnibus bill brings prohibition of termination for all the employees without exception for employees who are on trial period. Again, omnibus bill paves the way for making the employees take unpaid leave without any exception for employees who are on trial period. .

2) Is there any prerequisite for unpaid leave?

As is known, the Labour Law enables application of unpaid leave in very exceptional circumstances. In the event that the employee made to take unpaid annual leave not in case of such circumstances, employees will be entitled to terminate the employment contract based on just reason.

At this stage, with omnibus bill, employers become entitled to make the employees take unpaid leave unilaterally. However, employee who made to take unpaid leave  although the work is ongoing or especially the employees made to work despite the unpaid leave, because of failure to meet the responsibility of equal treatment  has right to terminate employment contract based on just reason and file a legal actionfollowing the end of three-months period.

3) Is it possible to make an employee for whom applied to short work take unpaid leave?

For the employee whom applied to short work cannot be made to take unpaid leave. In other words, those two concepts does not overlap.

4) Is it possible for an employee to resign and quit job?

In case the employee submits resignation and quits the job by self-consent, no infringement to the prohibition of termination can be mentioned

Although omnibus bill enables to make the employee take unpaid leave without consent, unpaid leave should be ultimo ratio. We would like to inform you that it is appropriate to informing us on such practice and make the application following our consultation.

II. AMENDMENTS WITHIN THE SCOPE OF COMMERCIAL LAW;

RESTRICTION OF ALLOCATION OF PROFIT SHARE:

With provisional article 13 included in the Turkish Commercial Law No. 6102 by omnibus bill, only %25 (twenty-five percent) of net profit for 2019 can be decided to be distributed. It is regulated that profits of the past year and free reserve cannot be subject to distribution and advance dividend distribution cannot be delegated to the board of directors.

Except for public subsidiaries, it is recommended that capital companies, which will make general assemblies for the accounting year of 2019, should put %25 of profit of 2019 into profit sharing taking into the regulation on Law, for distribution of cash profit share decisions to be put on the agenda. On the other hand, if general assembly had already rendered the decision on distribution of profit for the accounting year of 2019 before omnibus bill entering into force but the shareholders have not paid, in whole yet or have partially paid, the payment for the exceeding amount of %25 of net profit for 2019 shall be postponed until September 30, 2020.

Sistem Law Office