Employment Termination in Türkiye: Reinstatement, Severance and Building a Defensible Dismissal

The difficult part of an employment termination in Türkiye is rarely producing the termination letter.

The difficulty is deciding which legal basis the employer is actually relying upon, what that basis requires, and whether the evidence already in existence supports it.

Turkish employment law distinguishes between ordinary termination on notice, termination requiring a valid reason under the statutory job-security regime, immediate termination for just cause, collective redundancy and termination by mutual agreement. The financial consequences of dismissal, namely notice pay, severance, accrued leave and other entitlements, are related to those classifications but do not replace them.

That distinction matters particularly for international employers.

A headquarters decision that a role should disappear, that an executive is underperforming or that an employee has committed misconduct is a business conclusion. Before it is implemented in Türkiye, the conclusion has to be translated into the appropriate Turkish legal route, ideally as part of a disciplined employment strategy.

The statutory framework is principally contained in Labour Act No. 4857. Articles 17 to 21 regulate notice termination and job security; Articles 25 and 26 govern immediate termination by the employer in specified circumstances; and Article 29 deals with collective dismissals. Severance remains principally governed by Article 14 of former Labour Act No. 1475, which remains in force for that purpose.

The consequence is simple, although its application often is not: the employer should know its legal case before it dismisses the employee.

1. The first question is whether statutory job security applies

Article 18 of Labour Act No. 4857 creates the core job-security regime.

It applies, in general, where an employer terminates the indefinite-term employment contract of an employee with at least six months' seniority at a workplace meeting the statutory threshold of 30 employees. For underground workers, the six-month seniority requirement does not apply. Where the same employer has several workplaces in the same line of business, the employee threshold is calculated by reference to the aggregate number employed in those workplaces.

The statute also contains a relatively narrow managerial exclusion. It excludes those who manage the entire enterprise and their deputies, as well as managers who both manage the entire workplace and possess authority to hire and dismiss employees. A senior title by itself is therefore not necessarily sufficient to remove an employee from statutory job security.

That point is often important for country managers, directors and senior executives. Internal corporate status and the statutory concept of an excluded employer representative are not always the same thing. It is one of the recurring issues in senior executive employment.

Where Article 18 applies, an employer terminating an indefinite-term contract must rely upon a valid reason arising from the employee's capability, conduct or the requirements of the enterprise, workplace or work. The statute also expressly identifies reasons that do not constitute valid grounds, including union activity, the pursuit of statutory or contractual rights, pregnancy and specified discriminatory grounds.

An employee who falls outside Article 18 does not thereby lose every protection against dismissal. Notice requirements, the prohibition on abusive termination, equality rules, union protection and other mandatory provisions may still apply. Article 17 itself provides for bad-faith compensation in circumstances where employees outside the Article 18 to 21 regime are dismissed through an abusive exercise of the termination right.

The classification should therefore be made at the start of the exercise, not after the employee challenges the dismissal.

2. Valid reason and just cause answer different legal questions

A recurring source of avoidable litigation is the failure to distinguish geçerli neden (valid reason) from haklı neden (just cause).

They are not different levels of wording for the same dismissal.

A valid reason under Article 18 may justify termination within the job-security regime without amounting to grounds for immediate dismissal. Persistent underperformance, conduct affecting the employment relationship or a genuine operational requirement can support a valid termination even where the much more serious Article 25 threshold is not met.

Article 25 permits immediate termination without awaiting expiry of the contract or notice period in the circumstances specified there. Article 25(II), dealing with conduct inconsistent with morality and good faith and comparable circumstances, includes matters such as abuse of trust, theft, disclosure of professional secrets, certain unauthorised absences, persistent refusal to perform assigned duties after reminder and serious damage to workplace property within the statutory conditions.

The classification affects both procedure and money.

An employer may have a defensible conduct-based valid reason but insufficient grounds for an Article 25(II) dismissal. If the employer nonetheless characterises the case as immediate dismissal for just cause and withholds entitlements on that basis, the litigation may become wider than it needed to be.

Article 26 introduces another distinction. Where immediate termination is based on the morality and good-faith grounds in Articles 24 and 25, the right generally must be exercised within six business days from learning of the relevant conduct and, in any event, within one year of the act. The one-year period does not apply where the employee obtained a material benefit from the conduct.

The six-business-day rule is therefore not a universal limitation period for every dismissal connected with employee conduct. It belongs to the specified immediate-termination regime.

A careful employer asks first what the facts legally amount to, and only then chooses the termination route.

3. The written reason fixes the employer's case

Article 19 requires the employer, in a job-security dismissal, to give written notice and state the reason for termination clearly and precisely.

Where the termination is based on the employee's conduct or performance, the employer must also obtain the employee's defence before terminating, subject to the statutory exception preserving immediate termination under Article 25(II).

These are not merely HR formalities.

Article 20 places the burden of proving the existence of the valid reason on the employer. If the employee alleges that the employer's stated reason conceals a different reason, the burden of proving that alternative allegation falls upon the employee.

The termination letter therefore matters because it identifies the case that the employer will later be expected to prove.

Expressions such as "restructuring", "performance issues" or "loss of confidence" may accurately describe management's view but can be inadequate if they do not identify the factual reason with sufficient clarity.

A restructuring letter should correspond to a real organisational decision.

A performance dismissal should identify an actual deficiency capable of proof.

A conduct termination should be connected to identifiable acts or omissions.

The correct drafting process is therefore the reverse of what sometimes happens in practice. Counsel should not receive a concluded dismissal and then search for a legal formulation capable of justifying it. The legal basis should be tested before the dismissal is finalised, and the letter should record that basis accurately.

4. Performance dismissal is primarily an evidential problem

An employer does not normally struggle to identify the employee it regards as underperforming.

The difficulty arises when management's assessment has to be proved objectively months later.

Article 19 establishes the procedural starting point: before an indefinite-term contract is terminated on grounds relating to conduct or performance, the employee's defence must be obtained.

The Court of Cassation has applied this requirement strictly. In a reinstatement case concerning alleged performance deterioration, the Ninth Civil Chamber treated the employer's failure to establish a proper defence procedure as sufficient to undermine the dismissal.

A later decision illustrates the same broader problem. In a performance-based reinstatement dispute, the Ninth Civil Chamber concluded that the employer had failed, on the evidence, to establish a valid reason within Article 18. The underlying proceedings had also criticised a defence process in which the employee was given no meaningful opportunity before termination.

The practical issue is not whether Turkish law mandates one universal performance-improvement procedure. It does not.

The issue is whether the employer can demonstrate a credible performance case.

That will normally require examination of matters such as the standards applicable to the particular role, the period over which performance was measured, the reliability of comparative data, whether expectations were communicated, whether the deficiency was attributable to the employee and whether the assessment methodology was applied consistently.

The facts matter more than the label on the HR form.

A salesperson's performance may have declined because the territory changed.

A senior manager may have failed against a target that was never formally assigned.

A newly introduced KPI may make historical comparison meaningless.

A manager's dissatisfaction may be genuine while the documentary record consists almost entirely of positive appraisals.

None of those circumstances necessarily prevents dismissal. They affect whether the stated reason can later be proved.

The defence process is similarly substantive. A request sent immediately before dismissal merely to obtain a signature can be very different from an actual opportunity to answer the allegations.

The purpose of taking the defence is not to produce one more document for the personnel file. It is to allow the employer to make the termination decision after hearing the employee's response.

5. Misconduct investigations should establish facts before they classify them

Misconduct cases present the opposite problem.

Often the allegation appears serious from the beginning, which creates pressure to decide the legal character of the dismissal before the investigation is complete.

That can be a mistake.

An allegation involving confidential information, misuse of company systems, dishonesty, absence, insubordination, workplace violence or financial irregularity may potentially support different legal responses depending upon what the evidence ultimately establishes.

The employer may be considering disciplinary action short of dismissal, a conduct-based valid termination, or immediate termination under Article 25.

The investigation should therefore preserve the facts before management fixes the legal conclusion.

Relevant email, system logs, access records, financial records, CCTV lawfully obtained and retained, witness evidence, policies and acknowledgment records should be collected in their original context. The employee should be told sufficiently clearly what allegation is being put to him or her where a defence is legally required. Where the case touches confidential information or company systems, the analysis often overlaps with trade secrets and confidentiality protection.

For Article 25(II) cases, timing requires particular attention because of Article 26's six-business-day period. The factual chronology should identify when the conduct occurred, when it was discovered, who investigated it and when the person with authority to terminate acquired the relevant knowledge.

For multinational employers this can become complicated.

A compliance report may first reach regional headquarters. Local HR may then investigate. External forensic advisers may be instructed. The Turkish managing director may receive the concluded report later.

The legal file should show what happened rather than leave the court to reconstruct the chain from inconsistent email dates.

A serious allegation does not become legally stronger because the termination letter uses stronger language.

6. Operational dismissals are not reviewed as business judgments, but they are reviewed

A company is generally entitled to reorganise its business.

It can outsource functions, centralise operations, introduce technology, reduce capacity, close a department or alter its business model. Employment courts do not ordinarily decide whether the restructuring was commercially wise.

That does not mean a dismissal labelled "restructuring" escapes legal review.

Court of Cassation jurisprudence requires an operational termination to be connected to an identifiable business decision and examines whether that decision produced the employment consequence relied upon by the employer. The case law speaks of consistency, arbitrariness and proportionality review, including whether the dismissal became necessary as a result of the operational decision.

The distinction is important.

The court is not deciding whether outsourcing reception services was a good business idea.

It may decide whether reception was genuinely outsourced, whether the position actually ceased to exist, whether the decision was implemented consistently and whether the employee's dismissal followed from that change.

A recent Court of Cassation decision dealing with outsourced reception services is particularly useful. The underlying position was abolished and the service was transferred to an external provider; there was no subsequent recruitment into the same or a suitable role, and the operational decision was found to have been implemented consistently. In resolving conflicting appellate decisions, the Ninth Civil Chamber also cautioned against applying the "dismissal as a last resort" concept as a mechanical obligation to prove the absence of every hypothetical alternative in the abstract.

That is an important development for employer advice.

The principle remains relevant, but the analysis must concern real organisational alternatives, not imaginary positions invented after the event.

A strong restructuring file will usually show:

• what organisational decision was taken;
• when and by whom it was taken;
• which positions or functions were affected;
• how the decision changed the need for labour;
• why the particular role was affected;
• whether comparable roles remained;
• whether selection criteria were required and, if so, how they were applied;
• whether an actual suitable vacancy existed; and
• whether the organisation later behaved consistently with the stated restructuring.

The last point can be decisive.

A position supposedly abolished in June and advertised under a slightly different title in July creates an obvious evidential problem.

7. Collective dismissal is a separate compliance exercise

Where restructuring affects a sufficient number of employees, Article 29 introduces additional requirements.

The collective-dismissal regime applies where dismissals for economic, technological, structural or similar business reasons reach the statutory thresholds within a one-month period:

• 20 to 100 employees at the workplace: at least 10 employees;
• 101 to 300 employees: at least 10%; and
• 301 or more employees: at least 30 employees.

The employer must give written notification at least 30 days in advance to workplace union representatives, the relevant regional authority and the Turkish Employment Agency. The notification must state the reasons, the number and categories of affected workers and the period during which the dismissals are expected to occur. Where workplace union representatives exist, consultation follows on preventing the dismissals, reducing their number or mitigating their effects.

The statute also specifies that the dismissal notices take effect 30 days after the employer has notified the relevant regional authority of the intended collective dismissal.

Article 29 does not replace Articles 18 to 21.

The Court of Cassation has expressly recognised that compliance with the collective-dismissal procedure does not eliminate the requirement for a valid reason in an individual job-security case. It has also held that failure to comply with the notification machinery does not, standing alone, automatically answer the separate question whether the individual dismissal is invalid.

A collective redundancy therefore involves at least two legal workstreams: the statutory collective process, and the defensibility of the individual terminations made within it.

For larger restructuring projects, those workstreams should be planned together, often alongside cross-border legal coordination where the decision originates outside Türkiye.

8. Notice pay is not the price of a valid dismissal

Article 17 provides the statutory minimum notice periods for indefinite-term employment:

• two weeks for service of less than six months;
• four weeks for service between six months and eighteen months;
• six weeks for service between eighteen months and three years; and
• eight weeks for service exceeding three years.

The periods are minimum periods and may be increased by agreement. The employer may also terminate immediately by paying the remuneration corresponding to the notice period in advance.

The point international employers most often miss appears immediately afterwards in the same provision.

Payment in lieu of notice does not disapply Articles 18 to 21.

An employer therefore cannot convert an otherwise invalid job-security dismissal into a valid dismissal by paying eight weeks' notice.

The financial entitlement and the validity of the termination are separate questions.

Severance requires a further analysis.

Article 14 of former Labour Act No. 1475 remains in force for severance pay. Subject to the statutory conditions, qualifying termination can give rise to severance calculated on the basis of 30 days' wage for each full year of service, with proportional treatment for additional periods. The statutory provision also makes the manner in which the employment relationship ends relevant to entitlement.

This is particularly important where an employer relies upon Article 25(II).

A failed attempt to establish an Article 25(II) dismissal may therefore expose the employer not merely to an argument over reinstatement but also to financial claims that were withheld because the employer treated the termination as just cause.

Unused annual leave is another distinct item. Article 59 requires payment of accrued but unused annual leave upon termination regardless of the reason for the employment relationship ending.

A proper termination calculation should therefore follow the legal character of the exit rather than treating "final settlement" as a single number.

9. Mutual termination is useful only when it is genuinely mutual

A consensual termination agreement, usually referred to in Turkish practice as an ikale, can be an effective way to bring an employment relationship to an agreed end.

It is not a statutory shortcut around dismissal law.

The Labour Act does not specifically regulate ikale. Court of Cassation jurisprudence treats it as a contractual mechanism arising from mutual agreement and therefore examines both ordinary contractual validity and the particular employment-law consequences of the agreement.

Those consequences are material because an employee whose contract ends by genuine ikale may lose job-security protection and, in principle, termination rights that would otherwise arise from an employer dismissal.

For that reason, the Court of Cassation examines whether there was a reasonable benefit (makul yarar) for the employee in entering the agreement. Where the proposal originates with the employer, established case law ordinarily expects an additional benefit beyond the employee's statutory termination entitlements.

Recent official UYAP jurisprudence continues to apply the same analytical framework, while emphasising that the origin of the proposal and the actual facts of the employee's departure remain decisive.

This is why formulaic settlement agreements can fail.

An agreement signed in a termination meeting after the employee is told that the decision has already been made may invite scrutiny as to whether there was genuine contractual consent.

The document should correspond to the surrounding facts. Who initiated the proposal? Was the employee given a real choice? Was there time to consider it? What financial benefit was provided? Was the agreement negotiated or simply presented for signature? Do the payroll, correspondence and exit codes tell the same story?

The safest ikale is not the agreement containing the longest waiver clause. It is the agreement whose factual history supports the proposition that the employment relationship was actually terminated by mutual consent.

10. Reinstatement claims operate on short statutory periods

For an employee protected by Article 18, the timetable following dismissal is strict.

Under Article 20, an employee alleging that no reason was stated or that the stated reason was not valid must apply to a mediator for reinstatement within one month from notification of the termination.

If mediation ends without settlement, the employee may commence proceedings before the labour court within two weeks from the date of the final mediation record. The employer bears the burden of proving the valid reason relied upon.

Mandatory mediation also extends more broadly to claims for employment receivables and compensation based on legislation or individual or collective employment agreements. Article 3 of Labour Courts Act No. 7036 makes mediation a precondition to such proceedings, as well as reinstatement litigation.

For the employer, the practical implication is that the post-termination file should be preserved immediately.

A restructuring presentation should remain available in the version used when the decision was made.

Performance records should not be reconstructed.

Managers' emails should not disappear when accounts are closed.

Investigation materials, employee responses and proof of service should be kept together.

In an international group, relevant documents may sit in several jurisdictions and several systems. They should be collected before personnel change roles and before automated retention policies remove material that later becomes important.

By the time mediation begins, the evidence should already exist.

11. What follows if the dismissal is held invalid

Article 21 sets out the consequences of an invalid job-security dismissal.

Where the court or arbitrator finds the termination invalid, the employer must reinstate the employee if the employee makes the required application. If the employer does not reinstate, compensation of between four and eight months' wages becomes payable. The employee may additionally recover up to four months' wages and other rights for the period not worked pending the final decision. The court determines the relevant amounts in its decision on the basis prescribed by the statute.

The employee must apply to return to work within ten business days after notification of the final judgment or arbitral decision. If the employee fails to do so, the original dismissal is treated as valid for these purposes.

If the employee applies properly, the employer then has one month to reinstate.

These rules matter commercially because the reinstatement judgment does not end with an abstract declaration that the employer was wrong.

It creates a new decision point.

The employer must consider whether genuine reinstatement is operationally possible and desirable or whether the statutory consequences of non-reinstatement will be accepted.

That question can arise many months after the original dismissal, when the organisation may look very different.

It should nevertheless be anticipated when the termination risk is first assessed.

12. Some dismissals carry an additional statutory risk that should be identified at the outset

A valid termination analysis should not be conducted solely through Articles 17 to 26.

Article 18 itself identifies prohibited grounds. Separately, Article 5 of the Labour Act prohibits discrimination in the employment relationship, including specified differential treatment based on matters such as language, race, sex, disability, political opinion, philosophical belief, religion and similar grounds. The Ministry of Labour's official guidance confirms that the prohibition extends to termination and expressly addresses sex- and pregnancy-related discrimination.

Union activity presents another specialist regime under Law No. 6356.

Other cases may involve maternity protection, workplace representatives, occupational health and safety activity or another special statutory status.

This matters because an employer can have a superficially plausible performance or restructuring explanation while the surrounding chronology raises a different statutory issue. For example: an employee is dismissed shortly after making a formal statutory complaint; a pregnant employee is selected for redundancy without a documented selection process; a union-active employee is dismissed while comparable employees are retained; or a performance problem appears only after the employee asserts a legal entitlement.

None of those circumstances automatically proves an unlawful motive.

They do change the risk analysis.

The termination file should therefore include not only the employer's positive reason for dismissal but also a check for statutory protections capable of altering the case.

13. Global termination processes need local legal translation

International employers often arrive with a mature global HR process.

The difficulty is that the global process may have been designed around another jurisdiction.

A US-style termination letter may intentionally avoid detail. Article 19 may require the Turkish employer to state the reason clearly and precisely.

A global performance process may allow immediate termination once a manager's rating falls below a particular level. Turkish law may require a defence procedure and proof of a valid reason.

A headquarters restructuring may identify a reduction of five regional roles without explaining why the Turkish employee's particular role ceases to exist.

A global investigation may last several weeks, while an Article 25(II) case requires separate attention to the Article 26 timetable.

A UK-style settlement agreement may assume that broad contractual waiver wording is itself enough to characterise the departure as consensual. Turkish ikale jurisprudence looks beyond the document to the circumstances in which the agreement was made.

The answer is not to create an entirely different Turkish HR system.

It is to bring Turkish legal review into the global process before the decision becomes irreversible. That is particularly important where the employee is senior enough that several headquarters functions, namely HR, legal, compliance, finance and business leadership, are involved. The more people involved, the easier it is for the documentary history to become inconsistent, which is why board-level exits often intersect with directors' duties and D&O risk.

14. What should exist in the file before termination?

No competent employment lawyer should apply the same checklist mechanically to every dismissal.

A theft investigation, an underperforming sales manager and a redundancy following outsourcing are different cases.

There are nevertheless a number of questions that should ordinarily have answers before a significant employer-initiated termination is implemented.

Does the employee fall within the Article 18 job-security regime? That requires checking the contract type, seniority, employee threshold and any genuine senior-management exclusion.

What is the legal basis of termination? Valid capability reason, conduct, operational requirement or Article 25 just cause should not be treated as interchangeable descriptions.

What evidence existed before the decision? The employer should be able to point to contemporaneous documents rather than material produced after the dispute began.

Has the employee's defence been obtained where Article 19 requires it? The process should precede the final decision.

Does the written termination reason correspond with the evidence? A letter should not overstate the employer's case merely to sound decisive.

What statutory or contractual payments follow from the chosen route? Notice, severance, annual leave, bonuses, commissions, incentives and contractual benefits may each require separate treatment.

Is there an additional protection or process? Collective dismissal, union activity, discrimination risk or another statutory regime may alter the analysis.

Would the same explanation still make sense if read by a court a year later? That is usually the best test of whether the file is ready.

Conclusion

A defensible employment termination in Türkiye is not created at the termination meeting.

By then, most of the important legal facts already exist.

If the dismissal is based on performance, the performance history already exists, or does not.

If it is based on misconduct, the investigation has already been carried out, or has not.

If the reason is restructuring, the organisational decision has already affected the business, or the employer is still attempting to explain retrospectively why the employee was selected.

The Labour Act reflects those distinctions. Articles 18 to 21 regulate a statutory job-security system in which the employer must establish a valid reason and comply with prescribed procedure. Articles 25 and 26 create a different immediate-termination regime with different substantive and timing requirements. Article 29 adds a separate statutory process where a restructuring reaches collective-dismissal thresholds.

Recent Court of Cassation jurisprudence also confirms an important balance in operational dismissals. Courts do not substitute their own commercial judgment for management's business decision, but they do examine whether that decision genuinely affected employment, was implemented consistently, avoided arbitrariness and made the dismissal legally defensible.

That is the appropriate way to approach termination risk.

The objective is not to create paperwork around a decision already taken. It is to make the correct legal decision on the facts that actually exist.

How Terziolu & Partners Can Assist

Terziolu & Partners advises Turkish and international employers on employment termination, restructuring and related disputes in Türkiye. Our work includes job-security analysis; performance and conduct dismissals; internal investigations; Article 25 immediate-termination advice; employee-defence procedures; operational restructuring; collective redundancies; senior-executive exits; notice and severance analysis; mutual termination agreements; mandatory mediation; reinstatement litigation; and coordination of Turkish employment requirements with regional and global HR processes.

For significant exits, the most useful legal intervention ordinarily occurs before the dismissal is implemented. At that stage, the termination ground, procedure, evidential record and financial consequences can still be aligned. After the dismissal, counsel is usually working with the record that already exists.

Discuss an employment termination, restructuring or reinstatement matter with our team.

Selected authorities

Labour Act No. 4857, Articles 5, 17 to 21, 25 to 26, 29 and 59 (official text published by the Republic of Türkiye Ministry of Labour and Social Security).

Former Labour Act No. 1475, Article 14 (severance pay provisions remaining in force; official text published by the Ministry of Labour and Social Security).

Labour Courts Act No. 7036, Article 3 (mandatory mediation as a precondition to employment receivables, compensation and reinstatement proceedings; official Ministry of Justice material).

Court of Cassation, Ninth Civil Chamber, E. 2017/27109, K. 2018/13733 (performance-based termination and the Article 19 defence requirement; official UYAP case-law database).

Court of Cassation, Ninth Civil Chamber, E. 2022/18804, K. 2023/1615 (performance dismissal and failure to establish a valid reason under Article 18; official UYAP case-law database).

Court of Cassation, Ninth Civil Chamber, 2025 decision resolving conflicting appellate judgments concerning outsourcing of reception services (current treatment of operational dismissal and the application of the last-resort principle to concrete alternatives rather than abstract possibilities; official UYAP case-law database).

Court of Cassation jurisprudence on ikale (contractual consent, reasonable benefit and the significance of whether the termination proposal originated with the employer or employee; official UYAP case-law database).

Republic of Türkiye Ministry of Labour and Social Security, Labour Legislation Database (current texts of Labour Act No. 4857, former Labour Act No. 1475 and Law No. 6356).

Republic of Türkiye Ministry of Justice, Mediation Department (official materials concerning mandatory employment mediation under Law No. 7036).