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ECONOMICS > Government not planning shift in severance payment system

ISTANBUL- Hürriyet Daily News

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A draft on the severance system, which seems to have been laid aside after a speech by the prime minister, proposed depositing money in funds on behalf of workers. DAILY NEWS photo, Emrah GÜREL

A draft on the severance system, which seems to have been laid aside after a speech by the prime minister, proposed depositing money in funds on behalf of workers. DAILY NEWS photo, Emrah GÜREL

The government is not planning to change the severance payment system and will only take steps if the representatives of both employers and employees come to a consensus, Turkish Prime Minister Recep Tayyip Erdoğan has said.

“Unless they [employees and employers] reach an agreement, we won’t be involved in such a
program,” the prime minister said in response to journalists’ questions after the holiday prayer yesterday morning, Anatolia news agency reported.

The statement came amid media stories about a study by the Labor Ministry that would allegedly replace the current severance payment system with a new one which would basically deposit money in particular funds instead of making direct payments to employees leaving jobs.

Trade union is happy
Pevrul Kavlak, who is the secretary-general of Türk-İş, one of the leading labor unions in the country, said on his Twitter account earlier that Erdoğan had ordered Labor Minister Faruk Çelik to take the shift in the severance system off the agenda. Kavlak said he had been directly informed by the minister himself. “Our resistance and determined stand produced a result,” Kavlak said.

Under the current system, employees have a right to a severance payment worth 30-days salary for every single year they work. The draft was projecting to cut this amount to 15 days. Furthermore, it proposed preventing employees from withdrawing the money for a certain number of years after they quit the job. The draft would give workers three options for their vested rights: continuing under the conditions of the existing system, freezing their rights or demanding the transfer of their vested severance payments to the new funds.

Ümit Boyner, head of the Turkish Industry and Business Association (TÜSİAD), said earlier that the vested rights of employees should be secured.

August/20/2012

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