Turkish Law Blog

Short Time Work Allowance due to the Force Majeure

Elif Naz Calay Elif Naz Calay/ Kavlak Law Firm
06 April, 2020
318

Introduction

The Regulation on Short time Work and Short time Work Allowance (in Turkish “Kısa Çalışma ve Kısa Çalışma Ödeneği Hakkında Yönetmelik” hereinafter referred to as “Regulation”) has been published in the Official Gazette dated April 30, 2011 and numbered 27920.

In Turkish Law, according to the Regulation, public authorities are able to influence the adjustment of the labor input between changes in employment levels and changes in the average hours worked.[1]

Recently, some countries like Turkey have started to see the economic impact of the Covid-19 in terms of importing raw materials and goods from other countries where the spread of virus was initially strong. In this context many workplaces all over the world cannot work at full capacity or cannot work at all because of the pandemic. Therefore, the employer who has started to struggle economically has started to look for new solutions.[2]

The World Health Organization declared Covid-19 as a pandemic on March 11, 2020. Moreover, one of the main reasons for apply is force majeure situation. The definition of force majeure is; “manifestation of the forces of nature which are unpredictable and difficult to anticipate; the result of the direct, immediate and exclusive operation of the forces of nature, uncontrolled or uninfluenced by the power of man and without human intervention, is of such character that it could not have been prevented or avoided by foresight or prudence.”[3] Examples are tempest, lightning, earthquake, pandemic and a sudden illness. That means employers can apply for short time work because of the current situation.

Application

According to the third article of the Regulation “short time work is defined as temporal shortening of the employment period in the whole or part of the workplace by at least one-thirds or complete or partial suspension of operation for at least four weeks without the condition of continuation not longer than three months.”[4]

Upon the reduction of the working period by one-thirds or suspension of  the operation completely or partially for at least four weeks without any condition of continuation in the whole or part of the workplace the employer has an obligation to make a written notification to the employees. If in that workplace there is a Turkish Employment Agency (hereinafter referred to as “Agency”) or the labor union which is between employees that is party to the collective labor agreement then the employer has to declare the situation to them.

The situations for applying short time allowance are;

  • General financial crisis 
  • Regional crisis 
  • Sectorial crisis 
  • Force majeure (Covid-19 also appears as a force majeure)

The Turkish Ministry of Family, Labor and Social Services announced that the applications can be made online as of March 23, 2020. Also the results of the application will be learned through the e-mail address, via which the application has been sent.

The Employer applies online with a Short Work Request Form to the Turkish Employment Agency. Firstly, they have to send their applications through the e-mail addresses of the related provincial directorates of ISKUR which are specifically created for this purpose. The employer also has to load the list of the employees (with their normal working hours and list of details of the employees for reduced working hours) who benefit from the allowance as an attachment. Short time work request of the employer is firstly evaluated by the Agency in terms of its reason and form. The Board of Directors of the Turkish Employment Agency make a decision about the application in case of the presence of strong signs about general financial, sectorial or regional crises. If the applications are not in accordance with these conditions, then the Agency rejects them. All processes regarding the determination of short work application and conformity are determined by the Agency.[5]

In these circumstances where the employer applies for short time work allowance in one of the situations of force majeure like pandemic, then how can The Board of Directors of the Turkish Employment Agency conduct an inspection? Epidemic illnesses like Covid-19 make the condition of Board Decision impossible. Therefore, if the employer applies to the short time work because of the force majeure situations, then the Turkish Employment Agency can decide for application without the Board’s compliance inspection and decision. In addition, whole evaluation process has been changed right after the coronavirus showed up.

For an employee to benefit from the short time work allowance there is also another circumstance except the approval of the Agency according to the Regulation. In compliance with the Article 50 of the Unemployment Insurance Code, “employees should be entitled to unemployment allowance in terms of their employment period and the amount of days of unemployment insurance payment by the date of the commencement of short work (Of those who have paid premium for the last 120 days and constantly worked before the commencement of short work, those who have paid unemployment insurance premium for at least 600 days in the last 3 years).”[6]

However this condition of the application of short time allowance has been rearranged due to intensity and oversubscription of the applications of the employers. This rearrangement is made with The Omnibus Code numbered 7226 that has been published in the Official Gazette dated March 26, 2020 and numbered 31080. The amendments introduced by the Article 41 of the Omnibus Code revised the periods because of the effects of the coronavirus. The Article 41 of the Omnibus Code adds the Provisional Article 23 to the Unemployment Insurance Code numbered 4447. That new Provisional Article 23 states that “…of those who have paid premium for the last 60 days and constantly worked before the commencement of short work, those who have paid unemployment insurance premium for at least 450 days in the last 3 years to be applicable until June 30, 2020.”

Also, the Unemployment Insurance Code and the Article 7 of the Regulation states that “Amount of daily short work allowance is 60% of daily gross average earning calculated by taking into consideration the earnings of the insurant for the last twelve months subject to premium, not exceeding 150% of the gross amount of monthly minimum wage.”[7] Moreover, short work allowance is calculated monthly for periods of unemployment as covering the weekly working time in a workplace.

Period of short work allowance is as long as the short work period which is not more than 3 months. However, this period can be extended to 6 months by the decision of the President.

In the event of employer’s fault overpayments make due to false information or document are collected with their legal rate of interest from the employer. Also in the event of employee’s fault overpayments make due to false information or document are collected with their legal rate of interest from the employee. Short work allowance is paid to the employee as a wage at the end of each month and cannot be transferred or assigned to another person apart except subsistence debts.  In case of short work due to forces majeure, payments begin after the one week period according to the article 24/3 and the article 40 of the Turkish Labor Code numbered 4857.

Conclusion

As a result, Covid-19 is just a really good example of a legal status of force majeure. Pursuant to Turkish Labor Law, if a force majeure event causes the shutdown of a workplace, the employer is allowed to apply to the Agency for short time work allowance. Short time work and short time work allowance has been always a popular solution for the employers who have economic difficulties before the pandemic as well. Nowadays, almost all employers who are affected by the economic outcomes of the pandemic, started to collect documents for application. Apparently, it is the reason why the Turkish Employment Agency has changed the application system and accepts the applications online due to the work load.


References


[1]Short time working arrangements as response to cyclical fluctuations of European Commission

[2]  TURMOB, Mevzuat Sirküleri, 16.03.2020/71-1

[3] Law Dictionary, Steven H. Gifis, Sixth Edition, Press 2010, p.11, para.11

[4] The Regulation on Short time Work and Short time Work Allowance that published in the Official Gazette dated April 30, 2011 and numbered 27920.

[5] Short Time Working Allowance, Oğuzhan Küpeli, Ankara 2014

[6] The Unemployment Insurance Code numbered 4447 that has been published in the Official Gazette dated September 8, 1999 and numbered 23810.

[7] Provisional article 2 of the Unemployment Insurance Code numbered 4447 that has been published in the Official Gazette dated September 8, 1999 and numbered 23810.

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