Minimum Wage for Senior Employees Against the Ordinary Course of Events

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Supreme court ruled that paying minimum wage to an employee whose length of service is over six years in the workplace is against the normal course of events and that a precedent fee shall be determined for such employees.

DEFINITION OF WAGE IN LEGISLATION

  • Labor Law 4857: Wage is in general terms, the amount of money to be paid in cash by an employer or by a third party to a person in return for work performed by him.
  • Income Tax Law 193: Wage is a benefit provided by cash in kind and cash, represented by cash, in return of services performed by employees registered and subject to an employer.
  • Turkish Constitution: Wages shall be paid in return for work. The state shall take the necessary measures to ensure that workers earn a fair wage commensurate with the work they perform and that they enjoy other social benefits.

IS IT COMPULSORY TO RAISE THE WAGES ACCORDING TO SENIORITY?

There is no obligation for the employer to make any increase in employees’ wages, provided that wage is not under minimum wage and determined in line with principal of equality.

However, it is a common problem of Turkey that considerable numbers of workers are declared to be paid minimum wage although they are paid much over the minimum wage. The remaining part of the wage is paid by hand causing tax loses and employees having less retirement benefits.

SUPREME COURT CASE SUMMARY

  • Event: Employee is a press operator and working in the workplace for 6,5 years. According to SSI records he is being paid minimum wage.
  • Subject matter: Determining the actual wage that will be the base of the severance pay and other receivables of employee. SSI records show that employee is paid minimum wage.  
  • Claimant Employee’s allegation: Employee claimed that his actual wage is over minimum wage, and remaining part of his salary is paid unregistered.
  • Employer’s defense: Employer didn’t defense himself in the court.
  • Verdict of Local Court: Local court relied on (SSI (Social Security) records and decided that employee is being paid minimum wage, and this should be as a base on calculation of severance and payment to leaving employee.
  • Supreme Court Ruling (Civil Department No. 9 of Supreme Court, dated 11th December 2017): Disrupt the local court judgment for the following reasons;

ü  Employee who is working 6,5 years in the workplace and he should be considered as a qualified employee

ü  Paying minimum wage to an employee whose length of service is over six years in the workplace is against the normal course of events

ü  Instead of relying on SSI records a precedent fee shall be determined for him.

DEDUCTION

Taking into consideration the reality in labor relations in the country, labor courts don’t have to depend on SSI records. Only the actual salary of employee must be declared to SSI and be paid through the banks.

Illegal employment and tax evasions are serious crimes and can be liable to serious administrative fines and other penalties in Penal Code.

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