Contact: Süleyman Sevinç; Erdem & Erdem (Turkey)
Employers and employees can terminate an employment agreement by mutual consent at any time. This is a result of the freedom to contract, which is accepted in every case except for the special restrictions
regulated under the Code of Obligations. At this point, there is no difference between an employment agreement for a definite term and an employment agreement for an indefinite term. The agreement to terminate the employment agreement in this way is called an “abrogation agreement”.
Since the termination of an agreement through an abrogation agreement is not a termination of the employment agreement, the provisions concerning job security cannot be applied. Similarly, compliance with notification time or payment of the compensation related to the notification time (notification compensation) and payment of severance compensation do not arise. In other words, an employee is not entitled to the severance and notification compensation and cannot benefit from job security provisions. Moreover, an employee is not entitled to the unemployment allowance stipulated under Law No. 4447.
For these reasons, “a reasonable benefit” for the employee is required by the 9th Civil Chamber of the Court of Appeal for the conclusion of an abrogation agreement. The Court of Appeal’s skeptical approach may be explained by the use of this institution by employers to avoid fulfilling the job security provisions.
It is obvious that the Court of Appeal’s skeptical approach continues after the entry into force of Labor Act No. 4857, and the principle of interpretation in favor of employees is applied more strictly as the job security provisions are eliminated by the abrogation agreement.
“The abrogation agreement is not regulated under Turkish legislation. It is stated in a decision of the Court of Appeal that due to the freedom of contract doctrine it is possible to terminate a legal relation, and the parties are able to terminate the contractual relationship in a way other than the ordinary termination. This is defined as abrogation.
The accord of the intentions of employee and employer on the termination is not a termination of a party. The abrogation agreement is concluded when a party has communicated to the other a declaration concerning the conclusion of an agreement related to the mutual termination of the employment agreement (offer) and when the other party accepts this offer. However, the Labor Act does not regulate this type of termination.
The offer in an abrogation agreement aims to terminate the employment relation through the appropriate intention of the other party. Therefore, the offer related to the conclusion of an abrogation agreement cannot be considered a termination and cannot be converted into a termination.
In this sense, the form of an abrogation agreement, its conclusion, its scope and validity will be determined pursuant to provisions of the Code of Obligations. However, termination of an employment agreement through the abrogation agreement will be interpreted considering the principle of interpretation in favor of the employee since it closely concerns labor law.
The provisions of the Code of Obligations concerning defective intentions regulated in articles 23-31 must be carefully examined in terms of abrogation agreements. Normally, you would not expect an employee to try to benefit from the job securities stipulated for termination of employment agreements by the employer and to file a reemployment lawsuit within one month following its offer or acceptance for conclusion of the abrogation agreement.
It is also necessary to focus on the reasons for termination of the employment relation through a mutual agreement even though the relationship could be terminated by a dissolving constitutive declaration byeither of the parties. First of all, the offerer must have a reasonable interest in conclusion of an abrogation agreement.
Although terminations of employment relationships through abrogation agreements were not common in the period of Act. No. 1475 and previously, they have become more common following the entry into force of Labor Act. No. 4857 due to its job security rules. At this point, it is possible that the provisions for job security can be dismissed by conclusion of an abrogation agreement even though the transaction, in reality, is a termination of an employment relationship by the employer. In this respect, the reasonable interest of the parties in concluding an abrogation agreement must be determined separately from the control of intention defects. Reasonable interest is determined by considering whether the employee or the employer is the offerer, and the characteristics of the instant case must be taken into account.
An employee whose employment agreement is terminated through an abrogation agreement is not entitled to severance or notification compensation which are the rights related to a termination transaction, and he or she will be deprived of job security. The employee cannot benefit from unemployment insurance within the scope of Act. No. 4447. All these issues justify the need to interpret in favor of employees on the point of the validity of the abrogation agreement as the principle of strict interpretation is a rule in labor law for release contracts.
The parties may also stipulate in an abrogation agreement the notification, severance, and job security compensation. The validity of abrogation agreements will be evaluated considering all these points.” (9th Civil Chamber of High Court of Appeals E. 2008/1888, K. 2008/25058, T. 25.09.2008)
In addition to the decision of the 9th Civil Chamber of the Court of Appeal mentioned above, which analyses the approach to the issue of employment terminated by abrogation while conducting an appellate review, the same principles have been repeated in various decisions.
“In spite of the fact that each party can terminate the employment relationship with a dissolving constitutive declaration, the reasons for not making this choice and terminating by mutual consent should be emphasized. Even though examples concerning cases in which the employment agreement was terminated by an abrogation agreement were never reflected in practice, after the job security clauses entered into force, especially after Labor Act no. 1457, they became widespread.
At his point, the suspicion concerning the elimination of the job security clauses by the employer by disguising the termination by the employer as a mutual agreement can arise. In this respect, whether the parties have a reasonable interest in concluding an abrogation agreement besides the defective intention control should be examined. Reasonable interest criteria should be handled by taking into consideration whether the offer concerning the conclusion of an abrogation agreement was made by the employer or the employee, and the characteristics of the current case.
Not only is an employee whose employment agreement has been terminated by an abrogation agreement deprived of job security, but he or she is not entitled to notification and severance compensation, which are the rights connected to the termination. Furthermore, the employee will not be able to benefit from unemployment insurance within the scope of Act no. 4447. All these issues justify the need to interpret in favor of the employee on the point of the validity of the abrogation agreement as the principle of strict interpretation is a rule in labor law for release contracts.
The parties might also stipulate in abrogation agreement the notification, severance, and job security compensation, as well as the payment regarding the time without any employment and some or all of the other rights. The validity of abrogation agreements will be evaluated considering all these points.” (9th Civil Chamber of High Court of Appeals E. 2008/1888, K. 2008/25058, T. 25.09.2008)
Briefly, in case of a termination of an employment agreement through an abrogation agreement without considering the labor law principles such as “interpretation in favor of the employee”, “strict interpretation” and “reasonable interest criteria”, it is highly possible that the employee may benefit from the job security provisions of Act No. 4857 through a lawsuit.
