Choice of Law in a Turkish Employment Contract: What the 2025 Amendments to MÖHUK Art. 27 Changed

Since 4 June 2025 a more closely connected law can displace the clause outright.

Yes, within limits: where the employment relationship has a foreign element, Article 27/1 of the Private International and Procedural Law Act No. 5718 (Milletlerarası Özel Hukuk ve Usul Hukuku Hakkında Kanun, “MÖHUK”), as amended by Law No. 7550 with effect from 4 June 2025, subjects the contract to the law the parties determine by the contract. A Turkish court applies the chosen foreign law of its own motion (Article 2/1). Article 27/1 itself reserves the minimum protection the employee would have under the mandatory provisions of the law of their habitual workplace, so for someone who habitually works in Türkiye the mandatory rules of Turkish employment law remain a floor. Since the same amendment, Article 27/4 also allows a law more closely connected with the contract to be applied in place of the parties’ own choice, except for the provisions of the law of the place of work that must be applied at the time the work is done.

For a foreign employer, Article 27 is the provision that decides whether a template imported from head office survives contact with a Turkish workforce. It sits upstream of every substantive question covered in our guide to employment contracts in Türkiye: before you ask what the notice period is, you have to know whose law sets it.

What does Article 27 of Act No. 5718 say about choosing the law of an employment contract?

The official consolidated text of Act No. 5718, published at mevzuat.gov.tr, carries the annotation “(Değişik: 4/6/2025-7550/18 md.)” against paragraphs 1 and 4 of Article 27. The article now works as four connected rules.

Read together, the message is that a governing-law clause in an employment contract is a real choice with a real effect, but a conditional one. It never operates as a switch that turns Turkish employment law off.

What did Law No. 7550 change in Article 27 on 4 June 2025?

The pre-amendment text of Article 27 is available in the law as first published in the Official Gazette of 12 December 2007 (No. 26728). Comparing the two versions shows exactly where the 2025 drafting bites.

Two practical consequences follow, and neither is cosmetic.

First, the wording of paragraph 1 now anchors the choice to the contract itself. Under the general rule for contractual obligations in Article 24/1, a choice of law can be express or can be inferred without doubt from the terms of the contract or the circumstances of the case. Article 27/1 as redrafted speaks of the law the parties determine by the contract, which is a narrower formulation. Whatever position eventually settles on implied choices in employment cases, the drafting response is the same either way: name the law in a clause, in writing, and do not rely on inference from a head-office policy document or a payroll arrangement.

Second — and this is the change that most template reviews miss — the closer-connection escape in paragraph 4 now reaches paragraph 1. Before the amendment, that escape could only replace the default connecting factors where the parties had been silent. It now sits over the parties’ own clause. If the employer is Turkish, the workplace is in Türkiye, the payroll runs in Turkish lira, the social security registration is Turkish and the only foreign element is the sentence naming a foreign law, the counterparty has a textual basis for arguing that the contract is more closely connected with Turkish law and that Turkish law should apply in place of the clause. The counterweight built into the same paragraph runs in the employee’s direction too: the escape does not displace the provisions of the law of the place of work that have to be applied at the time the work is performed.

Which mandatory rules still protect an employee who habitually works in Türkiye?

Where the habitual workplace is in Türkiye, the reservation in paragraph 1 imports the mandatory core of Turkish employment law as a minimum. The comparison is made rule by rule rather than system against system: on any given point, the employee keeps whichever protection is higher. These are the provisions that most often set that floor, and the practical detail behind them is set out in our overview of employing staff in Türkiye.

Article 14 of Act No. 1475 also caps the annual amount of severance fixed by collective or individual agreement by reference to the maximum retirement bonus payable for one year of service to the highest-ranking civil servant under Act No. 5434. That ceiling is a moving figure republished periodically, so a contract should refer to the statutory mechanism rather than freezing a number.

Which law applies if the contract chooses none, and when does a posting not count?

Silence is not neutral. Under paragraph 2, the contract falls to the law of the workplace where the employee habitually carries out the work — and the same paragraph disarms the most common workaround by providing that a workplace where the employee works temporarily in another country is not the habitual workplace. Sending a Türkiye-based employee to a project abroad for a defined period does not relocate the applicable law, and equally, seconding a foreign employee into Türkiye on a temporary basis does not by itself make Turkish law the law of the habitual workplace under paragraph 2.

Paragraph 3 covers the genuinely mobile role — regional managers, technicians covering several markets, crews with no single base. Where there is no habitual workplace in one country and the employee works continuously in more than one, the applicable law is that of the country where the employer’s principal place of business is located.

Two Filters Above the Whole Exercise

Even a validly chosen law reaches the case through two general provisions of MÖHUK that operate independently of Article 27.

Article 5 — public policy. Where a provision of the competent foreign law applied to the particular case is manifestly contrary to Turkish public policy, that provision is not applied; the article adds that Turkish law is applied “where deemed necessary”. The intervention is provision-specific and does not automatically convert the whole contract to Turkish law.

Article 6 — Turkish overriding mandatory rules. Where foreign law is applicable, a rule of Turkish law that falls within the scope of overriding mandatory rules by reason of its regulatory purpose and field of application is applied nonetheless. This is a separate route from the Article 27/1 floor, and it does not depend on the habitual workplace analysis.

Two mechanics from Article 2 complete the picture. The judge applies Turkish conflict rules and the competent foreign law of their own motion and may ask the parties to help establish its content; and where the relevant provisions of the foreign law cannot be established despite all research, Turkish law applies. Separately, Article 2/4 provides that where a choice of law is permitted, the substantive provisions of the chosen law apply unless the parties expressly agree otherwise — so the clause does not drag in the foreign system’s own conflict rules.

Jurisdiction and Arbitration Are a Separate Clause

Governing law and forum are answered by different articles, and conflating them is where a template usually fails. Under Article 40, the international jurisdiction of Turkish courts is determined by the domestic rules on venue. Article 44 then gives jurisdiction in disputes arising from an individual employment contract or employment relationship to the court of the place in Türkiye where the employee habitually works, and in actions brought by the employee against the employer, also to the Turkish courts of the employer’s domicile or of the employee’s domicile or habitual residence.

Article 47/1 permits the parties to agree on a foreign court for a dispute with a foreign element arising from an obligation, where venue is not fixed on an exclusive basis, and requires the agreement to be proved by written evidence. Article 47/2 then states plainly that the jurisdiction determined by Articles 44, 45 and 46 cannot be set aside by agreement of the parties. In other words, the forum-selection clause that works in a supply agreement does not have the same effect in an employment contract. Whether an employment dispute may be referred to arbitration is a further and distinct question that a clause should not assume; the enforcement stage of any foreign decision is a separate exercise again.

One procedural rule applies whatever the governing law: under Article 3/1 of the Labour Courts Act No. 7036, recourse to a mediator is a condition of the action for employee or employer claims and compensation based on statute or on an individual or collective agreement, and for reinstatement claims. The claimant must file the final mediation record with the statement of claim. Where those steps are contested, the substantive and procedural questions run together, which is why they are usually handled alongside the wider issues in our labour law work.

What This Means for a Contract Template

The clause worth having is short and honest about what it does. It names one law expressly; it records where the employee habitually works; and it does not promise that the named law displaces Turkish employment protection, because Article 27/1 says it does not. Where the commercial reason for a foreign law is real — a genuinely international role, a group-wide incentive plan, a mobile crew — paragraph 4 makes it worth documenting why the connection to that legal system is stronger than the connection to the place of work, since after the 2025 amendment that comparison can now be run against the clause itself.

Reviewing an existing template against the amended article is a contained exercise: check the choice-of-law clause, the habitual-workplace description, the notice and termination provisions, the leave and working-time terms, and the forum clause, and note on each where the Turkish floor is higher. That review is part of how we approach employment contracts for employers whose staff work in Türkiye under documents drafted somewhere else.