Information Note on the Law No. 7224 on Reducing the Effects of the New Coronavirus (Covid-19) Outbreak on Economic and Social Life and the Law on Amending Certain Laws
Within the scope of the new measures to be taken against the possible effects of the COVID-19 epidemic on our country, which spread from Wuhan city of China and became an epidemic worldwide, numbered 7224 published in the Official Gazette on 17.04.2020, Reducing the Effects of the New Coronavirus (Covid-19) Epidemic on Economic and Social Life. The Law on Amendments to the Law and Certain Laws (“ Law ”) has been put into effect. We will briefly inform you about the new measures introduced by this Law.
A. REGULATIONS MADE UNDER LABOR LAW
- During the COVID-19 Pandemic, the Employment Contract Cannot Be Terminated by the Employer for 3 Months, and the Worker Can Be Placed on Unpaid Leave by the Employer
With the temporary article added to the Labor Law No. 4857 by the Law, all kinds of employment or service contracts, regardless of whether they are subject to the Labor Law, are closed for three months for the reasons specified in the second paragraph of the first paragraph of Article 25 of the Labor Law ( where the worker is constantly closely and if the employer or another worker with whom he meets directly is infected with a disease that is contagious or incompatible with the worker's job , it cannot be terminated by the employer, except for non-compliance with the rules of morality and good faith contained in the relevant provisions of other laws.
With the law, a phenomenon that was not previously regulated in the Labor Law was introduced and the employer was given the right to place the employee on partially or completely unpaid leave, provided that it does not exceed a period of three months. This period may be extended by the Presidency for up to six months. Before this regulation, unpaid leave was a phenomenon that operated only with the consent of the employee. In addition, it is stated in the regulation made in the article that taking unpaid leave does not give the employee the right to terminate the contract based on just cause. If the employer terminates the employment contract contrary to the reasons listed above, he/she will face an administrative fine equal to the monthly gross minimum wage for each worker.
Since the regulation is designed to cover all kinds of employment contracts, the question of what the employer will do for these workers will arise, as fixed-term employment contracts are also included in this scope. Considering that in practice, employers want to include indefinite-term contracts into fixed-term contracts, it can be interpreted that with this regulation, fixed-term employment contracts cannot be terminated within 3 months in order to protect workers. The regulation will aim to protect employment by allowing these employees to take unpaid leave and benefit from wage support within the scope of the Unemployment Insurance Fund, as summarized in the article below. Since the employment contract is suspended during the unpaid leave period and this period is taken into account in the seniority calculation, it seems that this practice will not have any negative reflections on employers at first glance, and that it paves the way for some wage support within the scope of insurance for workers.
2. Wage Support Will Be Provided to Workers Within the Scope of Unemployment Insurance Fund and These Persons Will Be Considered as Universal Health Insured
Workers who are put on unpaid leave by the employer within the scope of the temporary Article 10 of the Labor Law and who do not benefit from short-time working allowance, and workers whose employment contracts are terminated after 15.03.2020 in a way that makes them eligible for unemployment benefits, provided that they do not benefit from the unemployment allowance, are subject to the temporary Article 10 of the Labor Law. They will receive 39.24 TL daily cash wage support from the Unemployment Insurance Fund during the period they are on unpaid leave or unemployed within the termination ban period (This period is foreseen to be 3 months, but the period may be extended by the Presidency).
If the employee who is put on unpaid leave and benefits from wage support actually works, the employer will face a labor and administrative fine equal to the monthly gross minimum wage. The fee paid by the fund will be collected from the employer together with legal interest.
If those who benefit from cash wage support are not universal health insurance holders or are not one of the dependents of the universal health insurance holder, they will be considered universal health insurance holders and their premiums for general health insurance will be covered by the Unemployment Insurance Fund.
3. Short-time Working Allowance Will Be Made Before Completing the Eligibility Determination in Line with the Employer's Declaration
In accordance with the Unemployment Insurance Law No. 4447; For applications made for short-time working allowance within the scope of compelling reasons, payment was made following the completion of the eligibility determination by İŞKUR. Since 232,000 companies applied for the process as of April 16, 2020, it was not possible to complete the applications in the required time. With the change introduced by the Provisional Article 25 of the Law, if the employer applies for short-time working due to COVID-19, short-time working allowance will be made in line with the employer's declaration, without completing the eligibility determination.
It has been regulated that if the employer provides incorrect information and documents and excessive or inappropriate payments are made, these payments will be collected from the employer together with legal interest.
As a brief reminder, upon acceptance of the short-time working allowance request at the workplace, 60% of the employee's gross earnings, calculated by taking into account the employee's earnings subject to premium for the last twelve months, is paid from the Unemployment Insurance Fund to employees who meet the unemployment insurance eligibility conditions. The maximum amount the employee will receive within the scope of the allowance is limited to 150% of the gross monthly minimum wage (as of April 2020, this amount is limited to 4414.50 TL).
B. SOME REGULATIONS MADE WITHIN THE SCOPE OF COMPANY AND COMMERCIAL LAW
4. It has been decided to postpone, not collect or restructure some receivables within the scope of the first article of the law.
According to subparagraph a of the first paragraph of the first article of the Law, the amounts to be paid within the scope of the contracts concluded regarding treasury real estate and the amounts to be collected from the excise fees related to these real estate for the 3-month period starting from 01.04.2020 will be determined by the Ministry of Environment and Urbanization, without the requirement for the debtor to apply. It may be postponed. The Ministry of Environment and Urbanization may extend this period for an additional 3 months after the expiration of this 3-month period. These receivables will then be paid at the end of the postponed period by dividing it into equal monthly installments for the duration of the postponed period, without any late payment interest or interest. For example, in cases where there is a 5-month postponement, the debt will be paid in 5 monthly installments without any interest as of 01.09.2020.
Another postponement brought by the law is for receivables regarding permits given for special recreation areas and immovable properties. Within the scope of subparagraph b of the first paragraph of the first article of the Law, the recreation areas and immovable properties allowed for the purpose of tourism facilities are included in the scope of exception, and 01.04 of the recreation areas and immovable properties that are rented by the General Directorate of Forestry in accordance with the State Tender Law No. 2886 with the permission given in the state forests in accordance with the Forest Law No. 6831. .Amounts to be collected for the 3-month period starting from 2020 will be postponed for 3 months without the requirement for the debtor to apply. The Minister of Agriculture and Forestry may postpone it for an additional period of 3 months after the end of this period. These receivables will be paid in equal monthly installments for the duration of the postponed period, starting from the end of the postponed period, without any late payment interest or interest. In addition, a place can be established within the scope of the permit if the permit holder provides a letter of bank guarantee in return for the first year fees accrued within the postponement period of the above-mentioned permits.
Another important postponement brought by the law is for receivables related to immovable properties under the possession of municipalities. According to clause three of the first paragraph of the first article of the Law, receivables arising from sales, remuneration and renting of immovable properties owned or disposed of by metropolitan municipalities, municipalities, special provincial administrations and their affiliated organizations and the local administration unions of which they are members, are for the 3-month period starting from 19.03.2020. The parts that need to be collected can be postponed for 3 months. Metropolitan municipalities, municipalities, special provincial administrations and councils in unions will decide on the postponement; In affiliated organizations, the competent decision-making body is authorized. These periods may be extended for an additional 3 months by the Minister of Environment and Urbanization or the Minister of Internal Affairs. These receivables will then be paid at the end of the postponed period in equal monthly installments for the duration of the postponed period, without any late payment interest or interest. If the activities of the businesses are stopped or the businesses cannot operate, the rental fees for the period of inactivity will not be collected.
5. In order to protect the equity of Capital Companies, a temporary limitation has been imposed on the distribution of 2019 net profit.
With the temporary article added to the Commercial Code No. 6102, excluding companies where the state, special provincial administration, municipality, village and other public legal entities and more than fifty percent of the capital are owned by public funds, directly or indirectly, more than fifty percent of the capital; It has been decided that the amount of cash dividends that capital companies can distribute until 30.09.2020 cannot exceed twenty-five percent of the net period profit of 2019, previous years' profits and free reserves cannot be distributed, and the general assembly of companies cannot give the authority to distribute advance dividends to the board of directors . However, if the general assembly has decided to distribute dividends for the 2019 accounting period, but payments have not yet been made to the shareholders or partial payments have been made, payments for the part exceeding twenty-five percent of the net profit for the 2019 period will be postponed until 30.09.2020. It is stated that the procedures regarding the implementation of capital companies that will be exempt from the scope of this article will be determined by the Ministry of Commerce.
6. Exorbitant Price Practices and Hoarding are Prohibited in Retail Trade; Unfair Price Evaluation Board has been Established to Make Regulation and Inspection Regarding This.
With the additional article brought to the Law on the Regulation of Retail Trade No. 6585; producers, suppliers and retail businesses cannot excessively increase the sales price of any goods or services, and cannot engage in activities that create a shortage in the market, disrupt market balance and free competition,
By law, the Unfair Price Evaluation Board was established to control the exorbitant price and hoarding practices of manufacturers, suppliers and retail businesses. Accordingly, the Board is authorized to make regulations regarding exorbitant price increases and stockpiling practices, to carry out inspections and inspections when necessary, to impose administrative fines and to take all kinds of measures. In case of detection of an exorbitant price, from ten thousand Turkish liras to one hundred thousand Turkish liras; In case of detection of hoarding activity that creates a shortage in the market and disrupts market balance and free competition, an administrative fine of fifty thousand Turkish liras to five hundred thousand Turkish liras is foreseen. It is envisaged that how the exorbitant price will be determined and the procedures for inspection and inspection will be regulated in a regulation to be issued in the near future.
The chairmanship of the Board is carried out by the General Directorate of Domestic Trade, the General Director of Consumer Protection and Market Surveillance, the General Director of Tradesmen, Craftsmen and Cooperatives, one General Manager appointed by the Ministry of Justice, the Ministry of Treasury and Finance, the Ministry of Industry and Technology and the Ministry of Agriculture and Forestry, and the relevant Internal Affairs Directorate. It consists of thirteen members, including the Deputy General Manager of Trade, one member appointed by the Union of Chambers and Commodity Exchanges of Turkey and the Confederation of Turkish Tradesmen and Craftsmen, and one member each representing the producer and consumer organizations and the retail sector.
