Collective Dismissal In Turkey: Requirements, Process And Employee Rights

A collective dismissal—referred to under Turkish law as a “collective termination of employees”—is not merely a human resources decision. It constitutes a distinct legal regime under which employers are subject to substantial procedural obligations, non-compliance may result in administrative and legal consequences, and employees benefit from specific statutory protections. Article 29 of Turkish Labor Law No. 4857 regulates this process through prescribed numerical thresholds, notification requirements, and waiting periods. Accordingly, before deciding to implement a collective dismissal, the employer must carefully assess whether all statutory requirements have been satisfied.

This article examines the statutory definition of collective dismissal, the numerical thresholds applicable according to workplace size, circumstances that do and do not qualify as collective dismissal, the notification requirement and thirty-day waiting period, judicial review of business-related grounds, employees’ rights to monetary claims and legal challenges, and the employer’s administrative and legal liability.

The Concept and Legal Basis of Collective Dismissal

Collective dismissal is a special termination regime governed by Article 29 of Turkish Labor Law No. 4857. The Law treats the dismissal of a specified number of employees at a particular workplace within a specified period as a separate legal category from ordinary individual termination and imposes additional obligations in respect of such dismissals. The underlying rationale is that, unlike an individual termination, a collective dismissal may place significant pressure on both the labor market and the local economy and therefore warrants public oversight. Accordingly, the legislature has not confined the process solely to the employer-employee relationship but has also involved the relevant regional directorate and the Turkish Employment Agency (İŞKUR).

The special procedure applicable to collective dismissals is intended to maintain a fair balance between the interests of employees and employers. Sudden, large-scale dismissals effectively deprive employees of sufficient time to prepare for seeking new employment and may also adversely affect regional employment dynamics. For this reason, the Law imposes both an advance notification requirement and a mandatory waiting period on the employer. This gives employees an opportunity to prepare for the process while enabling public authorities to monitor the potential immediate effects on the labor market.

A breach of the statutory procedure may give rise to multiple legal consequences. These may include, in particular, an administrative fine imposed separately in respect of each affected employee, as well as claims arising from employment protection rules and other employment-related receivables, which may be pursued concurrently.

Numerical Thresholds for Collective Dismissals Based on Workforce Size

Numerical Thresholds According to Workplace Size

Article 29 of Turkish Labor Law No. 4857 determines whether a dismissal qualifies as a collective dismissal by reference to the total number of employees working at the workplace. Accordingly, dismissals carried out pursuant to Article 17 of the Labor Law within a one-month period will constitute a collective dismissal where:

• at least 10 employees are dismissed at a workplace employing between 20 and 100 employees;
• at least 10% of the workforce is dismissed at a workplace employing between 101 and 300 employees; or
• at least 30 employees are dismissed at a workplace employing 301 or more employees.

These thresholds are of considerable practical importance. Dismissals that remain below the applicable threshold are not subject to the collective dismissal regime; however, the rules governing individual terminations must still be fully observed. Once the applicable threshold is met or exceeded, the employer becomes subject to the notification and waiting-period requirements, including the obligation to notify the relevant regional directorate and the Turkish Employment Agency (İŞKUR).

The Thirty-Day Period and Method of Calculation

Whether the applicable threshold has been reached is determined by reference to the one-month period prescribed by law. This period encompasses dismissals carried out consecutively or on different dates. Accordingly, an employer cannot automatically avoid the collective dismissal threshold merely by spreading the dismissals across different days.

This is frequently a source of an employment dispute in practice, as employers may attempt to circumvent the collective dismissal procedure by staggering terminations. Courts, however, assess together all dismissals falling within the scope of Article 17 of the Labor Law that are carried out on the same or different dates within a one-month period. Where successive dismissals result from the same business decision and collectively exceed the applicable threshold, the collective dismissal regime will apply. This approach prevents circumvention of the statutory requirements.

What Are the Requirements for a Collective Dismissal?

To carry out a collective dismissal lawfully, the employer must fully comply with both the substantive and procedural requirements. Under Article 29 of Labor Law No. 4857, a collective dismissal has two principal components: a business-related justification necessitating the dismissals and full compliance with the procedural requirements that are relevant to their legal validity.

As a general rule, the primary sanction for non-compliance with the procedural requirements is an administrative fine. Such non-compliance does not, however, prevent the individual terminations from being separately reviewed under Articles 18 through 21 of the Labor Law in terms of the existence of a valid reason, written notice of termination, objective employee-selection criteria, the prohibition of discrimination, and the possibility of an anti-union motive. Careful management of every stage of the process from the outset is therefore essential.

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Economic, Technological, or Structural Reasons

The Law requires a collective dismissal to be based on a business necessity. In practice, such necessity generally arises under three principal categories: economic reasons, technological reasons, and business restructuring.

Economic reasons may include the need to reduce the workforce due to external pressures such as deteriorating market conditions, declining demand, or an unsustainable cost structure. Technological reasons arise where developments such as automation, digitalization, or the replacement or modernization of equipment eliminate particular positions. Dismissals resulting from restructuring may arise from a fundamental reorganization of the business, the consolidation of departments, or the closure of business units.

The justification for a collective dismissal must arise from economic, technological, structural, or similar business-related reasons rather than from the individual performance or conduct of the affected employees. It is not sufficient for the employer merely to assert such reasons in abstract terms. In any judicial review of the existence of a valid reason concerning employees covered by employment protection provisions, the employer must be able to demonstrate that the business decision was genuine and consistently implemented, that the selection of employees for dismissal was based on objective criteria, and why less severe measures were considered insufficient in the circumstances.

Courts may examine whether the alleged economic difficulties are genuine by reviewing financial statements, market reports, and restructuring plans. Accordingly, documenting the business necessity from both a legal and financial perspective before implementing the collective dismissal constitutes one of the most effective safeguards against potential reinstatement claims.

Procedural Requirements to Be Fulfilled by the Employer

An employer with a legitimate business-related justification must complete the statutory procedure before implementing the dismissals. Pursuant to Article 29 of the Labor Law, the employer must provide at least thirty days’ prior written notice of its intention to carry out a collective dismissal to the workplace union representatives, the relevant regional directorate, and the Turkish Employment Agency.

Where no workplace union representative is present, the obligation to notify union representatives does not apply in practice. The employer’s obligations to notify the relevant administrative authorities nevertheless remain in force.

The notification must, as a matter of law, specify:

• the reasons for the proposed dismissals;
• the number and categories of employees to be affected; and
• the period during which the terminations are expected to be carried out.

In addition, it is advisable to document the objective selection criteria and the grounds underlying the business decision in order to facilitate proof in any subsequent dispute.

The notification also initiates a genuine consultation process with the workplace union representatives. During these consultations, the parties are expected to consider measures to prevent the collective dismissal, reduce the number of employees to be dismissed, or mitigate the adverse consequences of the dismissals for the affected employees. A written record must be prepared confirming that the consultations have taken place.

Failure to conduct the consultation process or prepare the required record constitutes a breach of the procedure prescribed by Article 29 and may result in administrative sanctions. Such a breach does not, by itself, render the dismissals invalid. For employees covered by employment protection provisions, the validity of each termination must be assessed separately under Articles 18 through 21 of the Labor Law.

Notices of termination do not take effect until thirty days have elapsed from the date on which the proposed collective dismissal was notified to the relevant regional directorate. This period is not merely a waiting period. It is intended to allow the administrative notification and consultation process to operate and to prevent the terminations from taking immediate effect.

Special Regime Applicable to the Permanent Closure of the Workplace

Where the workplace is closed in its entirety and its operations are permanently and definitively discontinued, a special regime applies in place of the ordinary collective dismissal procedure.

In such circumstances, the employer’s obligations are limited to notifying the relevant regional directorate and the Turkish Employment Agency at least thirty days in advance and announcing the closure at the workplace. The obligation to consult with workplace union representatives does not apply in this specific situation.

Scope of the Collective Dismissal Regime

Determining when the collective dismissal procedure applies, and when it does not, is critically important for both employers and employees. The scope of the regime is not determined solely by numerical thresholds; the nature of the termination, the type of employment agreement, and the legal basis on which the employment relationship ends may also directly affect the outcome. Correctly distinguishing between situations that constitute a collective dismissal and those that fall outside the regime enables the employer to comply with its procedural obligations in a timely manner and determines which rights may be available to the employee.

It should be emphasized that, as a general rule, the terminations taken into account when calculating the collective dismissal threshold are terminations with notice initiated by the employer under Article 17 of the Labor Law.

Situations Constituting a Collective Dismissal

Terminations initiated by the employer under Article 17 of the Labor Law on the basis of a business decision will, as a general rule, qualify as collective dismissals where the applicable numerical thresholds are met. Large-scale workforce reductions implemented due to an economic crisis are among the most common examples. It is sufficient that a decision to reduce the workforce because of financial contraction affects a number of employees exceeding the applicable threshold within a one-month period.

The complete elimination of a department as part of a restructuring process may also constitute a collective dismissal. In such cases, the elimination of the relevant positions, independently of the individual performance or conduct of the employees concerned, triggers the application of the regime. The elimination of particular job functions due to automation or technological transformation is assessed in the same manner.

A notable issue in practice is that courts may recharacterize multiple transactions that the employer has treated as falling outside the collective dismissal regime by examining their true legal and factual nature. Accordingly, the legal characterization of the termination process is not determined exclusively by the employer’s designation.

Situations Not Constituting a Collective Dismissal

Not every termination of an employment relationship triggers the collective dismissal procedure. The automatic expiration of a fixed-term employment agreement is one of the principal situations falling outside the regime. Such expiration does not result from an exercise of the right to terminate but from the natural expiry of the agreement.

Terminations during a probationary period are also, as a general rule, excluded from the calculation. Because an employment agreement may be terminated during the probationary period without a notice period under Article 15 of the Labor Law, such terminations are not included in the threshold calculation under Article 29. However, where the probationary-period mechanism is used for the purpose of circumventing the law or abusing rights, the circumstances of the particular case must be examined separately.

The termination of seasonal or campaign-based employment does not fall within the collective dismissal provisions where it results from the natural end of the relevant season or campaign. Conversely, where a business-related mass termination is carried out under the appearance of seasonal employment, the actual circumstances must be separately assessed.

A genuine resignation by the employee, a valid mutual termination agreement, and retirement are also outside the scope of the collective dismissal procedure. By contrast, terminations initiated by the employer under Article 17 of the Labor Law must be separately assessed for collective dismissal purposes where the statutory thresholds are exceeded, even where those terminations are based on a criterion established over time under a collective bargaining agreement.

In practice, employers may attempt to misuse these exclusions. Courts therefore closely examine the true nature of the employment arrangement and the intent underlying the termination.

Notification Obligations and the Administrative Process

The essence of the collective dismissal procedure lies in requiring the employer to involve both employee representatives and public authorities before implementing a unilateral decision. Article 29 of Labor Law No. 4857 structures this obligation through workplace union representatives, where present, the relevant regional directorate, and the Turkish Employment Agency.

Proper completion of both notification channels reduces the risk of administrative sanctions and is also essential for correctly determining the date on which the terminations become effective.

Notification to Employee Representatives and the Duty to Consult

Before implementing a collective dismissal, the employer must provide written notice to the workplace union representatives, where such representatives are present at the workplace. This notice is not merely a general announcement. The Law expressly prescribes its mandatory content.

At a minimum, the notice must specify:

• the reasons for the proposed dismissals;
• the number and categories of employees to be affected; and
• the period during which the dismissals are expected to be carried out.

The notice also initiates a genuine consultation process. Workplace union representatives are entitled to meet with the employer and submit proposals aimed at preventing the collective dismissal, reducing the number of employees to be dismissed, or mitigating the adverse consequences for the affected employees.

Courts may assess whether the consultation was conducted in a manner consistent with its statutory purpose. However, this procedural review is principally relevant to administrative sanctions. The validity of the individual terminations is assessed separately under the employment protection regime.

Notification to the Relevant Regional Directorate and the Turkish Employment Agency

The employer must also provide written notice of the proposed collective dismissal to the relevant regional directorate and the Turkish Employment Agency. In practice, the filing and service process may be administered through the relevant Provincial Directorate of Labor and Employment Agency; however, the legally designated addressees are determined by the wording of the statute.

The content of this notification substantially overlaps with the notice provided to the workplace union representatives. Once the notification is submitted, the statutory thirty-day period begins to run. Even where individual termination notices have already been issued, they do not become effective before the expiration of this thirty-day period.

Incorrect calculation of the notification date is a common compliance failure in practice. An incomplete or defective notification, or failure to observe the thirty-day period, may expose the employer to additional legal risks, including an administrative fine imposed separately for each affected employee.

Penalties for Collective Dismissal and Employer Liability

An unlawfully implemented collective dismissal may have consequences for the employer on two separate levels: administrative fines and the risk of reinstatement claims based on the invalidity of individual terminations under the employment protection regime.

These consequences are not mutually exclusive. The same factual circumstances may result in an administrative fine and, for employees who satisfy the statutory employment protection conditions, a separate judicial review of the validity of their individual terminations.

The distinction between these two levels must nevertheless be maintained. The principal sanction for non-compliance with the Article 29 procedure is an administrative fine. A procedural breach under Article 29 does not, by itself, render the termination invalid.

Administrative Fine for Collective Dismissals in 2026

Under Article 100 of Labor Law No. 4857, an employer or employer representative who dismisses employees in violation of Article 29 is subject to an administrative fine for each employee dismissed.

For 2026, the amount announced by the Ministry of Labor and Social Security is TRY 9,943 for each affected employee. Because the fine is calculated separately for every employee, the total sanction may become substantial in large-scale collective dismissal processes.

Any statutory remedy against an administrative fine must be exercised within the applicable period following service of the decision. Under the current approach adopted by the Court of Cassation, challenges relating to administrative fines imposed under Labor Law No. 4857 fall within the jurisdiction of the criminal judgeship of peace. Accordingly, once the decision is served, correctly identifying both the competent authority and the applicable filing deadline is essential to avoid loss of rights.

Invalidity of Termination and the Risk of Reinstatement Proceedings

For employees covered by employment protection provisions—generally, employees working under an indefinite-term employment agreement, with at least six months’ seniority, in a workplace or enterprise satisfying the thirty-employee threshold, and who do not fall within the statutory employer-representative exclusion—the existence of a valid reason for termination is reviewed separately under Articles 18 through 21 of the Labor Law.

Where a court finds the termination invalid, the employer must reinstate the employee within one month following the employee’s timely application. If the employer fails to reinstate the employee, it must pay the statutory compensation for failure to reinstate.

The compensation for failure to reinstate is determined by the court and corresponds to no less than four and no more than eight months of the employee’s wages. In addition, the employer may be required to pay wages and other benefits accrued during the period in which the employee was not employed, up to a maximum of four months.

It should be emphasized that non-compliance with the Article 29 procedure does not constitute an independent ground that automatically renders a termination invalid under the employment protection regime. Invalidity arises where, for example, there is no valid reason for termination, objective selection criteria were not followed, or the termination was based on discrimination or anti-union grounds within the scope of Articles 18 through 21.

Severance Pay, Notice Pay, and Other Employee Claims in a Collective Dismissal

A collective dismissal process is critically important not only because of the employer’s procedural obligations but also because all monetary rights of the affected employees must be fully satisfied.

Turkish law does not recognize a separate category of compensation specifically called “collective dismissal compensation.” The employee’s financial rights consist of the proper calculation and payment of existing employment-related receivables.

An employee’s awareness that the collective dismissal procedure may have been violated may nevertheless be relevant, particularly for purposes of filing an administrative complaint, challenging the alleged business justification, questioning the selection criteria, and evaluating evidence in any reinstatement proceedings.

Conditions for Entitlement to Severance Pay and Notice Pay

A collective dismissal does not independently create an entitlement to severance pay or notice pay. As in individual terminations, entitlement depends on satisfaction of the general statutory conditions.

As a general rule, an employee must have completed at least one year of service with the same employer and the employment agreement must have ended on a ground qualifying for severance pay. Where the relevant statutory conditions are met, periods of service at different workplaces of the same employer are aggregated for purposes of calculating seniority.

Because most terminations implemented as part of a collective dismissal are based on economic difficulties, restructuring, or operational requirements, they generally constitute termination grounds that entitle the employee to severance pay.

Notice pay becomes payable where the employer terminates the employment agreement without observing the statutory notice period. Under Article 17 of the Labor Law, failure either to observe the notice period applicable according to the employee’s length of service or to make payment in lieu of notice gives rise to liability for notice pay.

As a general rule, severance pay is calculated on the basis of the employee’s final gross wage inclusive of regular monetary and measurable benefits, subject to the statutory severance-pay ceiling.

Other Employee Receivables and Priority Payment Rights

Payment for unused annual leave is calculated on the basis of the employee’s base gross wage as of the termination date. Severance pay and notice pay, by contrast, are calculated on the basis of the gross wage inclusive of regular benefits.

An employee becomes entitled to annual paid leave after completing at least one year of service from the date employment commenced, including any probationary period. Upon termination, payment is due only for annual leave that the employee has accrued but not used.

Accrued overtime pay, bonuses, and other contractual entitlements also become due upon termination. As a general rule, the statute of limitations applicable to such receivables is five years.

Bad-faith compensation generally arises in respect of employees who are not covered by employment protection provisions. For employees who are covered by those provisions, the principal remedy, where the statutory requirements are satisfied, is reinstatement proceedings.

Where an employer becomes unable to make payments due to a composition proceeding, a certificate of insolvency, bankruptcy, or suspension of bankruptcy, eligible employees may apply to the Wage Guarantee Fund administered within the Unemployment Insurance Fund.

Subject to the applicable conditions, the Fund may pay unpaid base-wage receivables for a period not exceeding three months. The amount payable may not exceed the maximum daily earnings amount used as the basis for social security contributions.

Employer Obligations Following a Collective Dismissal

The collective dismissal process does not end when the notices of termination take effect. Following the dismissals, the Law restricts the employer’s freedom to recruit employees and establish temporary employment relationships in two significant respects.

Preferential Rehiring of Former Employees for Equivalent Positions

Where the employer intends to recruit employees for positions of the same nature within six months following the completion of the collective dismissal, it must give preference to former employees whose qualifications are suitable for the relevant positions. A breach of this obligation may give rise to a separate legal dispute in relation to the affected former employee.

Eight-Month Prohibition on Temporary Employment Relationships

Under Article 7 of the Labor Law, a temporary employment relationship may not be established for a period of eight months at a workplace where employees have been collectively dismissed pursuant to Article 29.

This prohibition is intended to prevent an employer from implementing a collective dismissal formally while subsequently replacing the dismissed workforce through temporary agency employment arrangements.

Collective Dismissals in Light of Court of Cassation Case Law

An examination of Court of Cassation decisions concerning collective dismissals shows that the courts attach particular importance to the genuineness of the business-related justification, the objectivity of the employee-selection criteria, and compliance with the statutory procedure.

Because the statutory provisions are, in certain respects, framed in general terms, issues such as which measures constitute a collective dismissal, the legal consequences of procedural non-compliance, and the distinction between individual and collective terminations have largely been shaped by Court of Cassation case law.

Sanction for Procedural Non-Compliance: Administrative Fine

According to the settled approach of the 22nd Civil Chamber of the Court of Cassation, non-compliance with the collective dismissal procedure does not, by itself, render the termination invalid. The sanction for such non-compliance is an administrative fine.

This approach establishes that compliance with the collective dismissal procedure is not directly determinative of the existence of a valid reason or the validity of the termination itself. In practical terms, failure to comply with the notification and consultation obligations under Article 29 does not automatically result in reinstatement. For employees covered by employment protection provisions, however, the existence of a valid reason for termination remains subject to separate judicial review under Articles 18 through 21 of the Labor Law.

Distinction Between Collective Dismissal and Individual Termination

A recurring issue in practice is whether individual terminations carried out on dates close to one another should be assessed collectively as a collective dismissal.

In this respect, the Court of Cassation treats the employer’s underlying intention and the unity of the economic or operational decision behind the terminations as decisive criteria. Where successive and coordinated individual terminations are based on the same business-related justification and collectively exceed the applicable threshold, the courts may characterize them as individual terminations that have been artificially divided in order to avoid the collective dismissal regime.

This approach is intended to prevent employers from spreading terminations across different periods or departments for the purpose of remaining below the statutory threshold. Determining which terminations arose from the same decision-making process is therefore particularly important when evaluating evidence in litigation. The employer’s board resolutions, internal correspondence, and human resources processes may be closely examined for this purpose.

Legal Measures to Be Taken During a Collective Dismissal Process

A collective dismissal constitutes a legally significant process that may have substantial consequences for both employers and employees. Errors or omissions at this stage may result in losses that are difficult to remedy subsequently. It is therefore important to manage the process from the outset in accordance with a properly structured legal strategy.

The principal legal remedies and procedural deadlines applicable to employees and the measures to be taken by employers are addressed separately below.

Legal Remedies Available to Employees

The legal remedies available to an employee should be divided into reinstatement claims and claims for employment-related receivables and compensation, as the applicable deadlines and procedures differ.

For a reinstatement claim, the employee must apply to a mediator within one month following service of the notice of termination. This is a mandatory time limit, and failure to comply results in the loss of the right to pursue reinstatement.

Where no settlement is reached during mediation, the employee must file a reinstatement action before the competent labor court within two weeks following the date of the final mediation record. In such proceedings, the employer bears the burden of proving that the termination was based on a valid reason.

Mandatory mediation also applies as a prerequisite to litigation concerning employment-related receivables and compensation. Filing an action directly without first completing the mediation process will result in dismissal of the action on procedural grounds.

Claims for severance pay, notice pay, payment for unused annual leave, overtime pay, and other wage-related receivables may be brought before the labor court. The applicable limitation periods must be separately considered for each claim.

In addition to these remedies, where a collective dismissal is implemented without compliance with the statutory notification obligations, the employee may submit an administrative complaint to the relevant Provincial Directorate of Labor and Employment Agency. Such a complaint may result in the imposition of an administrative fine on the employer.

Strict compliance with limitation periods and mandatory filing deadlines is essential in relation to all available remedies.

Measures Employers Should Take to Manage the Process Properly

For an employer, the most critical aspect of a collective dismissal process is the timely and complete performance of the notification and consultation obligations prescribed by Article 29.

Terminations implemented in a manner that causes them to take effect before the expiry of the thirty-day period may expose the employer to additional legal risks, including an administrative fine calculated separately for each affected employee. It is therefore important for the content, form, and timing of the notifications to the relevant regional directorate and the Turkish Employment Agency to be prepared with the assistance of legal counsel.

Documentation serves a separate and essential function in this process. The economic, technological, or structural grounds underlying the collective dismissal decision should be recorded in writing and supported by board resolutions, human resources correspondence, financial reports, and other relevant documentation. This creates a strong evidentiary foundation for the employer in the event of a subsequent dispute.

The selection of employees to be included in the dismissal process should be based on objective and verifiable criteria. Properly documented selection criteria provide significant protection against allegations of discrimination, breach of the employer’s equal-treatment obligation, or anti-union motivation.

The employer must also account for the six-month preferential rehiring obligation and the eight-month prohibition on establishing temporary employment relationships when planning its post-dismissal workforce requirements.

The collective dismissal process involves a complex interaction of distinct legal assessments and potentially unforeseen risks. The most common errors encountered in practice include defective or late notifications, treating the consultation process as a mere formality, and failing to document the grounds for termination adequately.

Obtaining legal advice at an early stage can prevent these errors and help ensure that the process is completed in compliance with the applicable legislation while protecting the employer’s legitimate interests.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.