Workplace transfers have become more common recently, especially due to the coronavirus pandemic. Although transfers often proceed without conflict between the former and new owners, they can create problems for the employees at the transferred workplace. Employees must pay attention to several key points when their workplace is transferred.
Employees Should Be Careful During Workplace Transfers
Workplace changes can occur frequently in employment life. Particularly during the pandemic, many employers have had to transfer their businesses. In workplace transfers, employees’ rights often become a source of disputes. First and foremost, if employees do not consent, the new employer cannot change working conditions unilaterally. If employees sign agreements prepared by the new employer — for example agreements that reduce wages — they are considered to have accepted the new conditions and may suffer losses. For this reason, employees should scrutinize any contracts or proposals from the new employer during a transfer.
Employees whose workplace is transferred should also be attentive to their severance pay rights, especially if they have worked at the same workplace for many years. To preserve their entitlements, employees should be aware that under the old Labor Law No. 1475, when a workplace is transferred the length of service for severance pay is calculated based on the total duration of service at that workplace or workplaces. If the workplace changes hands for any reason, both employers are liable for severance pay that has accrued up to the relevant date. The transferring employer’s liability is limited to the periods during which they employed the worker and to the wage level at the time of transfer.
Pay Attention to the Employment Contract
Under Labor Law No. 4857, employees covered by this law retain all rights and obligations of their existing employment contract when the workplace is transferred; these rights and obligations pass to the new owner. Debts or obligations that arose before the transfer and are due at the time of transfer make both the transferor and transferee jointly responsible. It is also important to note that, under Law No. 4857, the transferor’s liabilities are generally limited to a two-year period that predates the transfer.
In its decision numbered 9860, the Court of Cassation (Yargıtay) stated that under the old Labor Law No. 1475 there is no time limit on the former employer’s responsibility regarding severance pay. The decision also explains that the two-year limitation provided in the new Labor Law No. 4857 for the transferor does not apply to severance pay. The court held that severance pay should be calculated for the entire service period before and after the transfer, while the transferor’s responsibility is limited to the period during which they employed the worker and to the wage level at the time of transfer.
An Employee May Refuse a Wage Reduction
When a new employer takes over a workplace, they often seek to change working conditions. A common request is to reduce wages. Employees are not obliged to accept such requests from the new employer. If an employee accepts unfavorable conditions, they may later face hardship.
In a workplace transfer, the employment contracts the former employer made with employees transfer to the new employer together with all associated rights and obligations. Therefore, even for justified reasons, the employer cannot unilaterally reduce wages. For a wage reduction to be valid, the employer must make a written proposal and the employee must sign to accept the new terms. Verbal notifications are not sufficient. If an employee does not respond to a written proposal within six days, the request is considered rejected. Employees should know that their previous rights are protected during workplace transfers and that any changes to pay or other core terms require their informed, written consent.