For 1 July – 31 December 2026, the severance pay ceiling is TRY 73,729.87. Severance pay is calculated as 30 days' gross wages for each full year of service and arises only in the termination cases listed in the law.
Under provisional Article 6 of Labour Law No. 4857, severance pay is still governed by Article 14 of the former Labour Law No. 1475. Because the ceiling is updated every January and July, the date on which the employment contract ends directly affects the calculation.
1. The current ceiling. The annual amount of the wage used for severance pay may not exceed the annual retirement bonus paid to the highest-ranking civil servant. The ceiling was TRY 64,948.77 for 1 January – 30 June 2026 and is TRY 73,729.87 for 1 July – 31 December 2026. The applicable ceiling is determined by the termination date of the employment contract.
2. Conditions for entitlement. The employee must have worked for the same employer for at least one year. In addition, the contract must end in one of the ways listed in the law: termination by the employer for a reason other than those in Article 25(II) of the Labour Law; termination by the employee for just cause under Article 24 of the Labour Law; leaving for compulsory military service; leaving to receive an old-age, retirement or disability pension or a lump-sum payment; a female employee leaving voluntarily within one year of marriage; and the death of the employee.
3. Employees who meet the retirement conditions other than age. An employee who has completed the insurance period and number of premium days required for retirement, and is only waiting to reach retirement age, may also become entitled to severance pay when leaving voluntarily. Because these conditions vary depending on the date of first insurance, it is advisable to obtain a letter from the Social Security Institution confirming eligibility before leaving.
4. Cases with no entitlement. Severance pay is not paid where the employee resigns without one of the reasons listed in the law, or where the employer terminates the contract under Article 25(II) of the Labour Law for conduct contrary to morality and good faith.
5. How it is calculated. Severance pay equals 30 days' wages for each full year of service, with proportional payment for any period exceeding a full year. The calculation includes the last gross wage together with monetary benefits, and benefits measurable in money, provided to the employee on a continuous and regular basis. If the resulting daily wage exceeds the ceiling, the calculation is based on the ceiling.
6. Tax and deductions. Severance pay within the statutory limits is exempt from income tax; only stamp duty at the rate of 0.759% is deducted.
7. Interest on late payment. If severance pay is not paid on time, interest at the highest rate applied to deposits may be claimed from the date the contract ended.
8. Mandatory mediation and limitation period. Applying to a mediator before filing a severance pay lawsuit is mandatory; if no agreement is reached at mediation, a lawsuit may be filed. The limitation period for severance pay claims is five years.
9. Effect of the 12th Judicial Package on employment claims. Since 31 July 2026, an indeterminate claim action can no longer be filed. In employment claims filed after that date, part of the receivable may be claimed and the claim increased once, in the same case, until the end of the evidentiary stage; for the increased portion, the limitation period is deemed interrupted from the filing date.
Conclusion. In a severance pay claim, the manner of termination, the ceiling on the termination date and the benefits included in the wage directly affect the outcome. These points, and the grounds stated in any termination letter, should be carefully assessed before leaving employment.
This article is for general information only and does not constitute legal advice. Please consult a lawyer about your specific situation.
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