Introduction
Before proceeding with the explanation on “Release Agreements in Labour Law”, it is necessary to look at the meaning of the word “release” by itself. In general terms, release is defined as the waiver of the creditor’s receivable by means of a contract concluded between the creditor and the debtor, in other words, the release of the debtor from his debt. Based on this definition, release agreements in labour law are documents signed by the employer in order to avoid any dispute in the process after the termination of the employment contract, and which show that the employee has received all of his/her receivables such as wages, severance pay, notice pay, annual leave pay, overtime work, week holidays, holiday holidays and that he/she has no other receivables from the employer.
Conditions of Validity of Release Agreements
There is no special regulation in the Labour Law No. 4857 regarding the release agreements to be concluded between the employee and the employer. Article 132 of the Turkish Code of Obligations No. 6098 regulates the release as one of the conditions that terminate the debt relationship, regardless of the labour law. Article 420 of the same Law contains provisions on service contracts, including employment contracts, and therefore deals with release agreements in labour law in detail.
With the aforementioned article, the validity of release agreements signed within the scope of employment contracts is subject to certain conditions. These conditions;
- The release agreement to be concluded between the employee and the employer must be in writing
- The release agreement must be issued at least one (1) month after the termination of the employment contract
- The type and amount of the receivable subject to release must be clearly and in detail
- Making the payment in full and through the bank according to the right
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Although the aforementioned validity conditions are only applicable to release agreements, the general conditions that must be present in the first place are that the release agreement must be concluded only with the free will of legal age individuals who have the power of appeal. Otherwise, the nullity of the release agreements signed under the conditions of defect of will will will come to the agenda. If these general conditions are met, the next step is to look at the special conditions regarding the validity of release agreements.
In this context, firstly, the condition that the release agreements signed regarding the employee’s receivables from the employer must be in writing is examined. What is meant by this condition is that the name, surname, address and signature of the employee must be written in handwriting in agreements written by technological means. The sole reason for the importance of this issue is that it will facilitate the burden of proof in the event that disputes are referred to the judiciary. Regarding the requirement of formality, the established jurisprudence of the Court of Cassation states that the use of a different coloured pen in the release agreement or the filling in of the parts that were prepared in advance and then left as blanks causes the release agreement to be deemed invalid.
Secondly, there must be a period of at least one (1) month between the date of signing the release agreement and the date of termination of the employment contract. Although this condition is intended to protect the employee against the employer, it is considered that the employee must be free from the pressure of the employer in order to be assumed that the employee’s will is to conclude a release agreement. In other words, since it is considered that the employee may have free will after the wage payment period has passed and all rights arising from the employment relationship have been secured, a period of one (1) month is stipulated between the signing of the release agreement and the date of termination of the employment contract, and it is stated that the termination of the employment contract must be carried out first of these two transactions. In order for it to be understood that the release agreement is issued at least (1) month after the termination of the employment contract, the release agreement must be dated. Otherwise, it will not be possible to determine whether the time limit has been complied with. However, it should be noted at this point that; since the reason for this condition is to protect the benefit of the employee and the principle of interpretation in favour of the employee prevails in labour law in general, the fact that a period of one (1) month must have elapsed from the termination of the employment contract until the signing of the release agreement is a time limit related to the issuance of the release agreements, not the payment of the labour receivables specified in the release agreement to the employee. For this reason, employers cannot delay the payment of labour receivables of the employee by interpreting this time limit in their own favour. Since the aforementioned period is related to the date of execution of the release agreement, severance pay, notice pay and similar labour receivables will become due upon termination of the employment contract before the execution of the release agreement.
Thirdly, in order for the release agreement to be valid, the type and amount of the receivable subject to release must be clearly stated. The point to be stated under this condition is that in the release agreement, all payment items made by the employer to the employee must be stated separately and their amounts must be written in a way that leaves no room for doubt. In the release agreement, the type and amount of the labour receivables that the employee has collected from the employer must be written item by item, and in addition, if there are some labour receivables that the employee has waived, the type and amount of these receivables must also be clearly stated in the agreement. Regarding this condition, the Court of Cassation disregards statements such as “I have received all my legal rights” and considers release agreements containing such statements invalid.
The last condition is that the payment must be made by the employer without any deficiency relative to the right and through a bank. Before explaining this condition, it would be beneficial to consider subparagraph 1 of Article 420 of the TCO No. 6098, which regulates the validity conditions of release agreements, and subparagraph 2 of the same article together. Subparagraph 2 of the aforementioned article states that release agreements that do not contain the actual payment of the right shall be deemed as receipts limited to the amount they contain. For this reason, in cases where the employer does not make the payment in full according to the amount of the right, the release agreement in question will have the effect of a receipt. For example, although the severance pay is stated as 10.000 TL in the release agreement, the payment of 7.000 TL by the employer will change the nature of the document in question and cause the document to be accepted as a receipt.
Regarding the payment to be made through a bank, regardless of whether the nature of the document in question is a release agreement or a receipt, in order to facilitate the burden of proof in the event of litigation due to the failure to resolve the dispute by peaceful means, it is stipulated that the payments agreed to be made by the employer to the employee must be made through a bank. In the event that the payment is made to a bank account, stating the date of release in the explanation section, as well as the fact that it is a payment made pursuant to the release agreement, is another issue that helps to facilitate the proof.
Sanctions and Consequences of Failure to Meet the Validity Conditions
To summarise, in order for the release agreements signed by the employee to be considered valid, they must be issued in writing, at least one (1) month must have elapsed since the termination of the employment contract, the type and amount of the receivable subject to the release must be clearly stated, and finally, the payment must be made in full and through the bank. As can be understood from the aforementioned conditions, the validity of the release agreements is subject to strict conditions, and in the event that the above-mentioned general and special conditions regarding the release agreement are not fulfilled in a cumulative manner, the release agreement in question will be deemed null and void. For this reason, if it is decided to draw up a release agreement regarding labour receivables, in order for the agreement in question not to be deemed invalid, it is important to firstly comply with the general conditions of having the power of appeal and being of legal age, which are included in the TCO No. 6098, and in addition to the conditions that the agreement is made with free will, and then it is important that the conditions specific to release agreements, such as written form, time limit, the amount and type of receivable, and the payment to be made in full compared to the amount of the right and through the bank.
