A. Termination of Employment Contract by
the Employer in General
Within the framework of the Labour Law No. 4857, the procedure for the termination of the employment contract of the employee by the employer is generally divided into three classes:
1- The first one is substantiated termination which arise from the employee and make the continuation of the employment contract unbearable for the employer. The reasons for this type of termination are set out under Article 25. Within the scope of the article, substantiated reasons are divided into four headings as 1) health reasons, 2) situations that do not comply with the rules of morality, 3) compelling reasons and 4) in the case of detention or arrest, the absence of the employee beyond the notification period being determined according to their seniority.
2- The second procedure is the termination of the employment contract by the employer without giving any reason. This is a way of termination in which the employer is generally considered to be at fault within the conditions of the specific case.
3- The third termination is the termination of the employment contract for valid reasons, and this is also called termination for a period of time. Termination for a period of time differs according to whether the employee whose employment contract is terminated benefits from job security or not.
At this stage, it is necessary to determine whether the employee's poor performance is a substantiated or valid reason for termination. According to the decision of the Court of Cassation General Assembly of Civil Chambers bearing the Basis number 2015/1598 and the Decision number 2017/643:
"The minutes within the scope of the
file and the basis for the termination of the employment contract are related
to poor performance. The defendant employer explained in his defence that the
employment contract was terminated due to the claimant's decrease in working
efficiency and refusal to give defence. The defendant also submitted some
documents related to the claimant’s poor performance. When Article 25 of
the Law No. 4857 titled "Employer's right to terminate immediately for substantiated
cause" is examined, it is clear that the employee's poor performance is
not among the reasons for substantiated termination. "Poor
performance", which is shown as a reason for the termination of the
employment contract, is a valid reason for termination set out under Article 18
of the Labour Law No. 4857. Given that poor performance, while not
reaching a level of severity to serve as a substantiated cause for termination,
does disrupt the regular workplace functioning and hinder the proper execution
of job responsibilities, it does present a valid basis for termination. This
form of termination, however, does not deprive the employee of their
entitlement to severance and notice compensation. Thus, opting to deny the
claimant's requests for severance and notice compensation instead of approving
them would be incorrect.
On the other hand, in the local court's decision of resistance, it was explained that the poor performance of the claimant employee, which caused the termination of the employment contract, was set out under Article 25/II-h of the Labour Law No. 4857, and therefore the employer's termination was based on substantiated cause. Article 25/II-h of the Labour Law accepts the insistence of the employee not to perform the duties that they are obliged to perform even though they are reminded of them as a substantiated cause for termination. On the other hand, if the employee performs their duty incompletely, badly or inadequately despite the warnings, this is a valid reason for termination. If the employee does not perform their duty despite the warning, the employer may use the right of immediate termination for substantiated cause; if the employee performs their duties incompletely, badly or inadequately, the employer may use the right of valid termination." [1]
As it is clearly seen in the relevant decision of the General Assembly of Civil Chambers, the termination of the employment contract due to poor performance is a valid reason for termination in the third category.
On the other hand, considering that termination for valid reasons is categorized into two groups based on whether the employee enjoys job security or not, the matter concerning poor performance must be evaluated independently depending on the employee's job security status. In this context, firstly, it is necessary to look at the definition of job security. According to the Labour Law, employees who work in workplaces employing 30 or more employees with an indefinite-term employment contract and have at least six months of seniority benefit from job security.
In this respect, primarily, it should be noted that, as a rule, the contract of an employee who does not benefit from job security can be terminated directly by the employer without giving any reason. Hence, in the case of employees working in establishments with fewer than 30 employees or those working in establishments with 30 or more employees but with less than six months of seniority, it should be noted that given the employer's ability to terminate employment contracts without providing a specific cause, there exists no barrier to effectuating dismissal based on poor performance or any stipulated prerequisites for its legality. This is because employees who do not meet the aforementioned conditions can be dismissed by the employer even without any reason. Therefore, in practice, the conditions sought for the termination of the employee's employment contract due to poor performance are important in cases where the employee benefits from job security.
B- Termination of the Employment Contracts of the Employees Benefiting from Job Security on the Grounds of Poor Performance:
As explained in detail above, employees who work in a workplace employing 30 or more employees and have six months of seniority benefit from job security by law. The employment contracts of these workers can only be terminated by the employer on the basis of valid reasons and the notice of termination must also be made in writing. According to Article 18 of the Labour Law No. 4857 titled "Valid Reasons for Termination", the employer who wants to terminate the employment contract of the employees who benefit from job security must base the termination of the employment contract on a valid reason arising from the competence or behaviour of the employee or the requirements of the workplace. Another consequence of the labour protection for the employer is that the employer who declares that they have terminated the employment contract for a valid reason is obliged to prove this claim.
Poor performance of the employee is within the scope of the reasons arising from the competence of the employee regulated within the framework of the relevant article. The employer who terminates the employment contract of the employee based on this reason is under the obligation to prove not only the existence of a valid reason, but also that the employee is inadequate in terms of performance. In addition, for the termination of the employment contract due to poor performance to be valid, there are certain conditions required within the framework of the jurisprudence of the Court of Cassation. These conditions should also be examined separately.
1- Termination on the Grounds of Poor Performance within the Framework of the Court of Cassation Jurisprudence
1.1. Developing a Workplace-Specific Performance Evaluation System.
For the employer to be able to use poor performance as a reason for termination, the employer must first develop a performance evaluation system specific to the workplace. This performance evaluation system and its application methods must be made available to the employees and implemented in the workplace. At the same time, the employees should be informed about the results obtained from this system, in other words, about their own performance.
1.2. Criteria for Performance Should be Predetermined and Objective.
The criteria for performance appraisal must be predetermined by the employer. However, it is not enough for the relevant criteria to be determined in advance. At the same time, the criteria must be set out objectively and concretely in accordance with the employee's employment contract, job description and workplace rules. In this respect, it is essential that the criteria determined by the employer are objective, appropriate to the workplace conditions and suitable for inspection.
Therefore, the employer cannot determine these criteria in a completely free manner. The criteria should be determined in a way that the employee can do what is expected of them and that the criteria comply with the job description in the employment contract. In this context, the performance evaluation system should be in accordance with the requirements of the workplace. These predetermined criteria should be taken as a basis for evaluation when evaluating competencies such as knowledge, skills, experience required by the job, behaviours appropriate to the workplace and work and personal development goals expected to be achieved by the employee.
1.3. Performance Criteria must be Clearly Communicated to the Employee.
The performance criteria determined by the workplace must be given to the worker in advance and in writing. In addition, the results of the personal performance measurement and evaluation of the employee, which are carried out at the workplace for certain periods of time, must be notified and made accessible to the employee. The consequences of not complying with these criteria must be clearly and precisely explained to the employee in a way that they can understand. In this context, the termination made on the basis of the performance evaluation criteria which are not notified to the employee and which the employee does not have the opportunity to access whenever they want, will be invalid.
According to the decision of the 9th Civil Chamber of the Court of Cassation bearing the Basis number 2015/5014 and the Decision number 2015/13582:
"It is understood that the defendant company did not determine the performance criteria to be subjected to the employee in advance and did not notify the employee when he started work. The performance standards were not specific to the workplace. The targets and standards were not determined in a way that the employees could reach within their job description. The claimant was not employed in another region. They were not subjected to in-house training at the points where their performance was poor. Therefore, the principles of proportionality and last resort were not complied with in the termination process. It is inappropriate to decide to dismiss the lawsuit instead of accepting it with an erroneous evaluation."[2]
Again, the decision of the 9th Civil Chamber of the Court of Cassation bearing the Basis number 2015/17470 and the Decision number 2015/25124:
"For employees to adhere to workplace performance criteria, it is essential for them to be adequately informed about these criteria. The termination made on the grounds that the employee does not comply with the performance evaluation criteria, which are not notified to the employee and cannot be accessed at any time, will be invalid." [3]
In this context, to proceed with a contract termination, an employee's anticipated performance letter, as stipulated by the employment agreement, should be formulated, and duly communicated to the employee. Consequently, the employer needs to possess a clear understanding of the expected performance standards from the employee.
1.4. Determined Criteria Should be Applied Equally to employees in the Same Position within the Same Time Frame.
As explained in detail above, the criteria determined by the employer must be objective, appropriate to the workplace conditions and suitable for inspection. The criteria must be equitable and must be applied equally to employees in the same position at the same time.
"The employer has an equal treatment obligation. The principle of equal treatment is a principle valid in all areas of law. In terms of labour law, it is a debt recognised by contemporary labour law, which expresses the obligation of the employer to treat the employees working in the workplace equally and to apply equal working conditions to the employees working in jobs of equal value. This principle is based on the principle of equality." [4]
The principle of equality is set out under Article 10 of the Constitution, according to which "Everyone is equal before the law without discrimination based on language, colour, sex, political opinion, philosophical belief, religion, sect and similar reasons". This Constitutional principle manifests itself in the Labour Law in Article 5 No. 4857.
As a matter of fact, Article 5 of the Labour Law No. 4857 titled "Principle of Equal Treatment" states: "No discrimination based on language, race, sex, political opinion, philosophical belief, religion and sect and similar reasons can be made in labour relations."
As a reflection of this principle and as a rule, the employer is obliged to treat the employees working in the workplace equally and to apply equal working conditions. In this context, the employer is obligated to ensure equal treatment, barring substantiated reasons, and to provide equitable access to both social and monetary benefits. The equal treatment obligation related to public order is obliged to be observed ex officio.
"However, the equal treatment obligation does not mean that the employer will treat all employees equally in absolute terms. The obligation of equal treatment is in question for workers with the same qualifications. The employer may create different working conditions based on objective reasons such as the work, expertise, education, seniority of the employee and subjective reasons such as diligence, talent and merit." [5]
"Again, the principle of equality cannot be mentioned for workers subject to different working conditions. Discrimination may be made between workers in this situation. However, this must be in accordance with the nature of the work and objective criteria." [6]
In this context, in accordance with the relevant provisions, while the same performance criteria should be applied to the same qualified employees with the same working conditions, different performance criteria can be determined for employees with different working conditions and different qualifications. This does not contradict the principle of equality. Hence, the designation of ‘poor performance’ is applicable solely when employees subject to performance evaluation are deemed inadequate based on a comparison with equally qualified colleagues performing identical tasks.
1.5. There Must be Persistent Poor Performance.
The existence of a valid reason based on poor performance can only be in question if the employee's performance is at a consistently low level or gradually decreases. As per the established legal precedent set forth by the Court of Cassation, outcomes that fluctuate due to objective circumstances and lack consistent patterns are not deemed satisfactory grounds for substantiating a valid reason related to poor performance. Furthermore, failure to achieve performance targets is not considered as a valid reason on its own, but the existence of a valid reason can be mentioned in cases where the worker does not show the necessary effort to achieve these targets, although their capacity is sufficient for the set targets.
As a matter of law, this issue is also stated in the decision of the 22nd Civil Chamber of the Court of Cassation bearing the Basis number 2018/14692 and the Decision number 2018/24703:
"For the employee's performance and productivity results to be the basis for a valid reason, objective criteria must be determined. Performance and productivity standards must be specific to the workplace. The objectivity criterion should be applied in the form that those who perform the same work in that workplace should be subject to the same rules. Performance and productivity standards must be realistic and reasonable. To have a valid reason based on performance and productivity results, there must be continuous poor or declining results. Results that change according to conditions and do not show continuity may not be considered sufficient for a valid reason. Moreover, failure to reach the targets for improving performance and productivity should not be a valid reason alone. If the capacity of the employee is sufficient for high targets but the employee does not show the necessary effort for these targets, there may be a valid reason. (Verdict dated 08.04.2008 and numbered 2007/27829, 2008/7831)
On the other hand, in order to be objective in performance evaluation and to accept the valid reason, performance evaluation criteria should be determined in advance, notified to the employee. These criteria should also be taken as a basis in the competencies such as knowledge, skills, experience required by the job, behaviours appropriate to the workplace and work and personal development goals expected from the employee. In other words, the quality of the employee, their behaviour, and the goal they achieve in the end are important. These criteria should be set out objectively in accordance with the employee's job description, productivity, the employer's corporate principles and workplace rules to be followed. Performance evaluation forms should be prepared accordingly. A performance evaluation system should be developed and implemented to evaluate the performance of employees specific to the workplace (Verdict of the Chamber dated 24.09.2007 and numbered 2007/13994, 2007/27720)." [7]
1.6. Negativity Must Occur in the Workplace and in the Execution of the Work due to the Employee's Inadequate Performance.
Pursuant to the principle of termination as a last resort, it is not possible to accept the lack of performance as a valid reason for termination of employment alone. Before terminating the employment contract, the employer must investigate the reasons for the employee's poor performance and eliminate or try to eliminate these reasons. In this context, for termination, the employee's poor performance problem must still persist when the reasons affecting the employee's performance are eliminated, but this alone is not sufficient for termination. Additionally, it is also required that the employee's poor performance causes negativities in the workplace and in the execution of the work, such as increasing the workload of other employees, damaging the company, causing work-related crises.
1.7. The Result of the Performance Evaluation Should be Notified to the Employee. The Employee Should be Warned and a Suitable Period of Time should be Given for the Correction of the Situation.
Again, as another reflection of the principle of termination as a last resort, in cases where an employee's evaluation outcome falls below the workplace benchmarks through the performance evaluation mechanism, it becomes imperative to address this matter distinctly. The employee should be duly alerted, with a separate communication, and provided guidance on how to rectify the situation by acting more attentively and conscientiously, incorporating the employee's input. In this context, it is not possible to directly terminate the employment contract on the basis of the performance evaluation result. It should be clearly stated to the employee in which of the works specified in the job description and previously notified to them is inadequate. Moreover, the employee must also be given a reasonable period of time to correct their behaviour and improve their performance after the notification. Pursuant to the established case law of the Court of Cassation, the termination based on the performance result, which is not notified to the employee, or which is not given a reasonable and favourable period of time, is invalid.
1.8. Training Should be Given to the Worker If Necessary for the Performance Expected.
Again, it will not be possible to directly terminate the employment contract of the employee on the grounds that a job requiring training is not performed or is performed incorrectly or incompletely. To be able to terminate the employment contract due to incorrect or incomplete performance of a job of this nature, the employer must have previously provided the necessary training to the employee regarding the relevant job.
1.9. Defence Must be Taken from the Employee.
Before the employee's contract is terminated for reasons related to poor performance, their defence must be considered. This defence must be taken in writing, and it should be noted that the presence of the employee's signature in the performance evaluation reports notified to them does not mean that their defence has been received. In this context, for the termination to be valid, the employee must first be notified of the poor performance and then, in addition to this notification, a written defence must be taken.
1.10. Poor Performance of the Employee Must Be Proved Objectively by the Employer.
Just as the employer must prove that the employee's contract was terminated for a valid reason, the employer who terminates the employee's contract based on poor performance must be able to clearly demonstrate this poor performance. In this context, in the termination of the employment contract based on poor performance, the employer is obliged to clearly prove both the existence of a valid reason and the existence of poor performance.
2- Consequences of Termination Not Based on Valid Reason.
Under the circumstances explained, the contract of the employee may be terminated validly due to poor performance. If these conditions are not met, the employee's contract will be deemed not to have been terminated for valid reasons, and the employee will be able to assert all claim rights arising from the employment security provisions against the employer.
In this regard, as outlined by Article 20 of the Labour Law No. 4857 pertaining to job security, an employee whose employment contract is terminated without a valid reason holds the right to initiate a reemployment lawsuit in the labour courts within a two-week period following the issuance of the mediation final minutes. This lawsuit can be brought forth on the grounds that either the termination notice did not provide a reason, or the provided reason was not valid.
When the court decides to reinstate the employee as a result of the reinstatement lawsuit filed in this respect, the employer is obliged to reinstate the employee within one month. For the employer to employ the employee, the employee must first apply to the employer to start work within ten working days. If the employer does not reinstate the employee within one month despite the employee's application, the employer shall be obliged to pay compensation to the employee in the amount of at least four months' and at most eight months' wages. Additionally, for the period that the employee is not employed until the finalisation of the verdict, the employee must be paid their wages and other rights up to a maximum of four months in any case. [8]
CONCLUSION
Within the framework of the matters explained in detail above, the employee's frequent illnesses and reports, the employee's clear and objective inability to learn the job and improve themselves, the employee's lack of aptitude for the job and slowing down the work, the employee's desire and focus towards the work and the performance of the work continuously decreasing, the employee's performance lower than what is normally expected from them and the employee's performance is lower than what is expected from them, and the employee's performance is significantly less productive than those who perform more or less similar work with them are among the situations that are accepted as valid grounds for termination due to poor performance within the scope verdicts. In this context, cases of poor performance are not limited.
However, it should be emphasised that these conditions are not considered as poor performance in all circumstances, but only in the presence of the above-mentioned conditions together.
As a result, it is possible to validly terminate the contract of the employee due to poor performance within the conditions mentioned. It is also obligatory for the employer to make the termination notice regarding the poor performance in writing and to state the reason clearly and precisely for termination. Termination of the employment contract with general statements such as “due to your incompetence” is not valid. Furthermore, for termination for a valid reason, the person must be evaluated for performance and warned at least three times due to poor performance. The performance evaluation letter in question should also be notified to the person. The behaviours to be corrected should be explained and a reasonable time should be given for correction. Only under these conditions, the termination based on poor performance may be valid.
Beyza Nur Göksel, Legal Intern
Translated By: Sude Çapoğlu
References:
1. Verdict of the Court of Cassation General Assembly of Civil
Chambers bearing the Basis number 2015/1598 and the Decision number 2017/643
2. Verdict of the 9th Civil Chamber of the
Court of Cassation bearing the Basis number 2015/5014 and the Decision number 2015/13582
3. Decree of the 9th Civil Chamber of the Court of Cassation bearing
the Basis number 2015/17470 and the Decision number 2015/25124
4. Çelik, Nuri, İş Hukuku Dersleri, İstanbul 2009, 22nd Edition,
177
5. Süzek, Sarper, İş Hukuku, 2005, 2nd Edition, 362
6. Çelik, Nuri, İş Hukuku Dersleri, İstanbul 2009, 22nd Edition ,179
7. Decree of the 22nd Civil Chamber of the Court of Cassation bearing
the Basis number 2018/14692 and the Decision number 2018/24703
8. Göksel, Beyza Nur, “İşçinin Cep Telefonu Yazışmalarının
İşveren Tarafından İncelenmesi Sonucu Yapılan Fesih Geçerli Midir?”
