Those who wait for July will come out ahead: Increase coming for severance pay

The rate of the raise to be applied to civil servant salaries will be clarified with the inflation data to be announced in July. This raise rate will also directly affect the severance pay ceiling. Currently, based on 5-month inflation data, a raise of approximately 14% is projected for civil servant salaries. With the June data, this rate is expected to exceed 15%.

WHAT IS THE CURRENT SEVERANCE PAY CEILING?

For employees subject to Labor Law No. 4857, the currently applied severance pay ceiling is 46 thousand 655 liras and 43 kurus for each year of service. Even if your gross salary is higher, legally, no more than this limit can be paid.

For example, for someone who has worked for 10 years, the severance pay they can receive based on this ceiling is limited to 466 thousand 554 liras and 30 kurus.

HOW WILL THE CEILING CHANGE WITH THE NEW RAISE?

If the expected 15% civil servant salary raise occurs, the severance pay ceiling will rise to 53 thousand 653 liras and 75 kurus. In this case, an additional gain of approximately 7 thousand liras will be provided for each year.

It is financially more advantageous for employees who want to resign and receive their severance pay to wait for July. Thus, there is a chance to receive 7 thousand liras more in compensation for each year.

Women who get married (within 1 year after marriage) and men who are going to perform their military service can receive severance pay if they resign. It is recommended that those in this situation also wait for the July raise.

It is possible to be entitled to severance pay even without meeting the requirements for retirement. Without needing to wait for the employer to terminate employment, one can resign and receive compensation when conditions such as age, premium days, and the year of insurance commencement are met.

WHO CAN RECEIVE SEVERANCE PAY AND UNDER WHAT CONDITIONS?

Those insured before September 8, 1999: 15 years of service and 3600 premium days

Those who started between September 8, 1999 – April 30, 2008: 25 years of insurance and 4500 premium days or 7000 premium days

Those who started between May 1, 2008 – December 31, 2008: 4600 premium days

Those who started between January 1, 2009 – December 31, 2015: Between 4600–5300 days, with +100 days added for each year

Those who started after January 1, 2016: 5400 premium days (with 15 years of insurance duration)

SEVERANCE PAY CAN BE RECEIVED MULTIPLE TIMES

The right to severance pay is not limited to one time. For example, you can receive severance pay after working at Company A for 10 years. If you then move to Company B and work for 5 years, a new right to compensation arises from there as well.

To receive compensation, one must apply to the Social Security Institution (SGK) and obtain a "Severance Pay Eligibility Letter." When this document is presented to the employer, the payment must be made.