The conclusion of an agreement between the parties to bring the employment contract to an end through their mutual and corresponding declarations of intent is referred to as a mutual rescission agreement. Although the concept of mutual rescission is not expressly regulated under the Turkish Labour Code No. 4857, its legal basis is derived from Article 26 of the Turkish Code of Obligations, which embodies the principle of freedom of contract. Pursuant to this provision, parties are free to determine the content of their agreements, provided that such agreements do not contravene mandatory legal provisions, morality, public order, or personal rights. Within this framework, an employee and an employer are equally free to bring their employment relationship to an end by mutual rescission.

By its legal nature, a mutual rescission agreement does not constitute a unilateral termination of employment. Whereas unilateral termination produces legal consequences through a unilateral declaration of intent by either the employee or the employer, a mutual rescission agreement is a separate and independent contract formed through the convergence of the parties' mutual and corresponding intentions. Accordingly, where a valid mutual rescission agreement exists, the employment contract is not deemed to have been terminated by either party; rather, it comes to an end in accordance with the parties' common will.

Nevertheless, since one of the fundamental objectives of labour law is the protection of employees, the validity of mutual rescission agreements is subject to particular scrutiny. In order to prevent employers from misusing the institution of mutual rescission as a means of circumventing employment security protections, reinstatement claims, or obligations arising from termination, it is necessary to examine whether the agreement genuinely reflects the parties' free will and whether the employee had a reasonable benefit in entering into such an arrangement.

According to the settled case law of the Turkish Court of Cassation, a mutual rescission agreement may only be considered valid if the employee executed the agreement voluntarily and without being subjected to any pressure, threat, undue influence, manipulation, or coercion. Where an employee signs a mutual rescission agreement out of fear of losing his or her job, after being compelled to resign, or without being afforded any realistic alternative, the validity of the agreement becomes questionable. In such circumstances, the transaction will frequently be construed not as a mutual rescission agreement but rather as a termination effected by the employer.

In addition, the Court of Cassation requires the existence of a reasonable benefit accruing to the employee. By entering into a mutual rescission agreement, the employee waives various statutory protections, including, most notably, the right to bring a reinstatement action. Accordingly, the employee must receive an additional advantage sufficient to justify such waiver. In this regard, the payment of statutory entitlements alone is generally considered insufficient. Beyond legal receivables such as severance pay and payment in lieu of notice, the employee is generally expected to receive an additional payment or benefit.

When determining the amount of such additional consideration, the specific circumstances of the case must be taken into account. In particular, factors such as the employee's position within the company, length of service, educational background, professional experience, working conditions, and salary level should be assessed. In practice, and in light of the case law of the Court of Cassation, there are decisions recognizing that an additional payment corresponding to approximately four months' salary may constitute sufficient reasonable benefit for the employee. However, this amount is not absolute or fixed and may vary depending on the particular circumstances of each individual case.

Furthermore, the party from whom the mutual rescission proposal originates is also of significance. If the proposal to rescission the employment relationship by mutual agreement originates from the employer, the requirement of reasonable benefit should be assessed more strictly, given that the employee relinquishes important employment security rights. Conversely, where it can be clearly and unequivocally demonstrated that the proposal originated from the employee, the payment of severance pay and notice compensation may be considered sufficient. Nevertheless, in order to avoid potential disputes, it is advisable that this issue be expressly addressed in the mutual termination agreement.

To minimize the risk of future disputes, the mutual rescission agreement should be drafted in a detailed and transparent manner. In this respect, the employee's final gross and net salary, severance pay, notice compensation, unused annual leave pay, outstanding wage receivables, and any additional benefits payable under the mutual termination arrangement should be specified separately and itemized in the agreement. In addition, the gross and net amounts of each payment item, together with the payment dates and methods of payment, should be clearly stated. Such an approach will ensure that the parties' agreement regarding each entitlement is documented with precision and will help prevent future legal disputes.

In conclusion, a mutual rescission agreement is a special contractual mechanism through which the employment relationship is brought to an end by the mutual consent of the employee and the employer, rather than by way of unilateral termination. However, given that the employee is regarded as the party requiring protection from an economic and social perspective, the employee's free will and the existence of a reasonable benefit are of paramount importance in assessing the validity of such agreements. Particularly where the mutual rescission proposal originates from the employer, the provision of an additional benefit beyond statutory entitlements and the clear, comprehensive, and unambiguous documentation of all payment items within the agreement are key factors supporting the validity and enforceability of the mutual rescission agreement.