Severance pay is the financial compensation that the worker will receive in return for the “severance” he has accumulated during his time at the workplace. While the worker contributes to his job and workplace for years, he contributes to the conduct of the employer’s commercial business. Severance pay is paid taking into account the employee’s last gross wage. You can use our Severance Pay Calculation Tool by filling in the required fields below.
Please note, this calculation table and the results it contains are for general information purposes only, and our site does not make any commitment as to the accuracy of the information based on this table. All data presented in the calculation table is provided for general understanding purposes only and may not reflect your personal situation. Before taking any action or decision, it is recommended that you seek legal advice from a lawyer.
It is made based on the employee’s service period since the date he started work and his last gross wage. Severance pay calculation formula:
Severance Pay = Duration of Service (Year) × Final Gross Wage
Calculation Steps:
• Last Gross Wage: The last gross salary of the worker on the date of leaving the job.
• Service Period: For each year completed from the date the worker started work
• Missing Years: Calculation is made based on the daily wage for the days and months remaining from the full year.
Duration for Payment of Severance Pay
There is no clear period specified in the Labor Law No. 4857 regarding the payment period of severance pay. However, the general opinion and practice is that it must be paid immediately and within a reasonable period of time from the date of termination of the employment contract. As a matter of fact, in accordance with Article 32 of the Labor Law titled “Wage and Payment of Wages”, “In the termination of employment contracts, the employee’s wage and benefits that can be measured in money arising from the contract and the Law must be paid in full.” Severance pay must be paid immediately after termination.
Statute of Limitations for Severance Pay
According to the legal regulations in Turkey, the statute of limitations for severance pay receivables is 5 years. This period starts from the date of termination of the employment contract and ends at the end of 5 years. If a claim for severance pay is not made or a lawsuit is not filed within this period, the right to severance pay expires and this right is lost.
For more details, you can take a look at our article titled ‘ Severance Pay ‘.
