Startup Series – Iv: Labour Law | Types of Employment Contracts
In the previous articles of our Startup Series, we have examined the types of companies found in Turkish Law, the necessary conditions for their establishment, the issues to be evaluated during the company establishment process, partnership agreements, and crowdfunding. In this article, we would like to make a brief introduction to labor law, a field of law that you may need at the point where your startup takes a few steps forward.
When your startup starts to grow, you may come to the point where you or your partner’s work alone is not enough due to the volume your operation will take. At this stage, it may be a beneficial choice to hire your first employees who will play a role in the development of your startup. In this article, we will take a look at the employment contracts within the scope of the Labor Law numbered 4857 (“Law“).
Employment contracts are defined in the 8th article of the Law as “an agreement whereby one party (the employee) undertakes to perform work in subordination to the other party (the employer) who undertakes to pay them remuneration”. Employment contracts are not subject to a special form unless otherwise specified in the Law, however employment contracts with a duration of one year or more are required to be made in writing. In cases where a written contract is not made, the employer is under the obligation to provide the employee with a written document, showing the general and special conditions of work, the daily or weekly working time, the basic wage and any wage supplements, the time intervals for remuneration, the duration if it is a fixed-term contract, and conditions concerning the termination of the contract within two months at the latest, Employment contracts may differ in terms of the duration of the contract and working hours, and we will mention the most common types of employment contracts in the rest of our article.
a. Indefinite Term Employment Contracts
Indefinite term employment contracts are applied in cases where the employment relationship is not established depending on a certain period of time and are the essential type of employment contract in our law. Within the scope of this employment contract type, “employment security” provisions, which are applied in workplaces employing 30 or more employees, have been introduced. In the termination of indefinite term employment contracts, the employer is obliged to base the termination on a valid reason arising from the competence or behavior of the worker or the requirements of the workplace or work. It should be emphasized that; in cases where the employment contract is terminated for reasons such as the behavior or performance of the employee, the defense of the employee about these issues should be taken first. In addition, it has been regulated that the termination to be made in the 19th article of the Law should be made in writing and the reason should be clearly stated. It should also be remembered that, as a result of improper termination, workers who are covered by job security can file a reemployment lawsuit.
b. Definite Term Employment Contracts
Definite term employment contracts, as the name suggests, refers to employment contracts that are limited to a certain period of time. However, the Law has concluded a definite term employment contract to certain conditions. By the 11th article of the Law, definite term employment contracts can only be concluded in written form and depending on objective conditions such as the completion of a certain job or the emergence of a certain event. To conclude a definite term employment contract, having an objective reason justifying the conclusion of a definite term employment contract, as enumerated in the aforementioned article, is very important. Examples of these reasons may be the completion of a project, temporary filling of a vacant position due to pregnancy or military service. In the absence of such an objective reason, the contract is likely to be interpreted as an indefinite term contract by the courts in a possible dispute. It should be reminded that more than one definite term employment contract cannot be concluded subsequently if there is no substantial reason. Otherwise, the employment contract will be interpreted as an indefinite period from the beginning. In addition, it should be emphasized that employees employed on a definite term employment contract cannot be subjected to a different treatment than a comparable employee who is employed on an indefinite term employment contract unless there is a reason justifying the separation.
c. Part-Time İş Sözleşmeleri
A part-time employment contract is defined as an “employment contract where the normal weekly working time of the employee has been fixed considerably shorter about a comparable employee working full time” in the 13th article of the Law. If the “comparable worker” mentioned in the article is a full-time worker in the same or a similar job at the workplace, and if such a person is not at the workplace, the employee who is employed on the same or similar work in the relevant line of work on a full-term employment contract will be taken as a basis. A point to be emphasized about part-time work is that part-time employees cannot be treated differently than full-time employees just because their employment contract is part-time, and there must be a justification for the different treatment. In addition, the divisible benefits of the part-time employee regarding wages and money will be paid in proportion to the period of employment compared to the full-time equivalent employee, and part-time employees will be entitled to annual paid leave if they complete one year from the date of starting work. In addition, the employer should consider the requests of the part-time employees to switch from part-time to full-time when there is an open place suitable for their qualifications.
d. Remote Working
It can be said that remote working, which is a very popular form of work especially during the Covid-19, is actually a type of work that existed in the lives of entrepreneurs before the pandemic. Remote working was essentially regulated in Article 14 of the Law. The Remote Work Regulation (“Regulation“) prepared based on the regulation included in the Law has been published in the Official Gazette on March 10, 2021, and entered into force. Remote working is defined in Article 4 of the Regulation as “the employment relationship established in writing and based on the principle that the employee fulfills their work at home or outside the workplace with technological tools of communication, within the framework of the work organization created by the employer”. Contracts for remote work must include the description of the job, the way it is performed, the duration and place of the work, the matters regarding the wages and payment thereof, the work tools provided by the employer, the equipment and obligations regarding their protection, the employer’s communication with the employee and the provisions regarding general and special working conditions and contracts must be made in writing. In addition, it should be reminded that the Regulation regulates that the materials and work tools required for the production of goods and services of the remote employee should be provided by the employer unless otherwise agreed. Another important issue regarding remote work is that the time interval for working remotely is specified in the employment contract. Finally, we would like to remind you that working with hazardous chemicals and radioactive substances, processing these materials or working with the wastes of these substances, working remotely in jobs that involve the risk of exposure to biological factors are exempted from remote work by the Regulation.
In conclusion, we wanted to briefly inform you of the types of employment contracts. However, the aforementioned contracts should be prepared by the nature of your business and project. For this reason, we find it beneficial to get support from an expert in any type of employment contract you will make.
Kılınç Law & Consulting
Innovation & Fintech
Kılınç Law & Consulting's Innovation & Fintech department represents established companies with regards to their digital endeavors