KEY CONSIDERATIONS ABOUT ANNUAL PAID LEAVE PRACTICES

Although annual paid leave is often regarded by employers as an administrative HR matter, recent court decisions have demonstrated that non-compliance with the applicable legal requirements may give rise to significant employment law risks.

In particular, the way annual leave is granted and the timing of the payment of annual leave pay may play a decisive role in employees’ claims for termination for just cause, as well as other employment-related claims.

In this newsletter, we would like to draw your attention to two key issues that employers should carefully review.

1. At Least One Portion of Annual Leave Must Consist of a Minimum of Ten Consecutive Days

Pursuant to Article 56 of the Turkish Labor Code:

• annual paid leave should, as a general rule, be taken uninterrupted;
• it may be divided into separate periods upon mutual agreement between the employer and the employee; however,
• at least one portion of the annual leave must consist of no less than 10 consecutive days.

In this regard, recent court decisions have held that:

• allowing employees, over a number of years, to take annual leave only in 5-, 6-, 7- or 9-day periods;
• failing to prove that such practice was based on the employee’s request or the parties’ mutual agreement; and
• administering annual leave in a manner contrary to Article 56 of the Turkish Labor Law

may constitute just cause for termination by the employee.

2.             Annual Leave Pay

Pursuant to Article 57 of the Turkish Labor Code, employers are required to pay the employee’s annual leave pay in advance or as an advance payment before the employee starts his or her annual leave.

In practice, many employers continue to pay annual leave pay on the regular payroll date. However, this practice is inconsistent with the explicit wording of the Labor Code.

In this respect, recent court decisions have reaffirmed that the payment of annual leave pay before the commencement of annual leave constitutes a mandatory legal obligation under Article 57 of the Turkish Labor Code.

Accordingly, employers should ensure that their payroll and payment procedures fully comply with this requirement and that appropriate supporting records are properly maintained.

To assist employers in addressing the issues outlined above, our Law Firm provides comprehensive legal support in relation to:

• reviewing annual leave policies and procedures;
• assessing HR and payroll practices for compliance with Turkish Labor Code;
• conducting legal audits of annual leave record-keeping systems;
• advising on employment compliance projects; and
• reviewing and updating employment agreements, employee handbooks and internal HR policies and procedures.

Our Law Firm remains at your disposal for any further clarifications you may need.

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