İPSD (Incapacity Capitalized Value) is the present value, by the actuarial method, of the permanent incapacity income awarded by the SGK to the employee after a work accident or the death pension awarded to the beneficiaries. The employer is released from liability to the extent of this amount.
What is İPSD?
Under Law No. 5510 Art. 21, the employer is released from liability to the extent of the benefits provided by the SGK to the employee or the beneficiaries. These benefits are:
- Temporary incapacity allowance
- Permanent incapacity income (for the employee)
- Death pension (for the beneficiaries)
- Funeral allowance
These amounts are calculated using the capitalized value table current as of the accident date and deducted from the compensation.
How is the offset made?
- A capitalized value letter is obtained from the SGK.
- The capitalized value table current as of the accident date is applied.
- If there is no gross negligence, the calculated amount is deducted from the gross compensation.
- The result is the net amount to be claimed from the employer.
Note: The current value of the amounts paid by the SGK must be used. Old-dated SGK letters do not pass Court of Cassation review and are grounds for reversal.
Gross negligence exception
Under Law No. 5510 Art. 21/last, if there is gross negligence on the part of the employer, the offset does not apply. Typical examples of gross negligence:
- Failure to take any OHS measures
- Failure to provide personal protective equipment
- Failure to give the employee safe work training
- Failure to employ an OHS specialist
- Failure to establish an inspection and control mechanism
- Continuing production despite a known danger
Caution: A finding of gross negligence determines the outcome of the case. The OHS specialist's report, OHS board decisions, inspection records and witness statements are critical at this point. If this finding is made, the compensation increases significantly.
Scope of the offset
The İPSD offset is made only from pecuniary damages. No offset is made from non-pecuniary damages. In addition:
| Item | İPSD Offset |
|---|---|
| Permanent incapacity (pecuniary) | ✅ Offset |
| Temporary incapacity (pecuniary) | ✅ Offset |
| Caregiver costs (pecuniary) | ❌ Not offset |
| Loss of support (pecuniary) | ✅ Offset |
| Non-pecuniary damages | ❌ Not offset |
Sample calculation
İPSD offset — example
| Gross permanent incapacity compensation | 1.800.000 ₺ |
| SGK capitalized value (İPSD) | −360.000 ₺ |
| Finding of gross negligence | None |
| To be claimed from the employer | 1.440.000 ₺ |
Had gross negligence been found, the offset would not apply and the claim would be 1.800.000 ₺.
Frequently asked questions
What is İPSD?
It is the capitalized value of the income awarded by the SGK to the employee or the beneficiaries.
In which cases is it offset?
In all cases where the employer is at fault and the SGK has awarded income/a pension. If there is gross negligence, the offset does not apply.
How is gross negligence established?
Failure to prevent dangers that could have been prevented by a simple measure, such as failure to take OHS measures. Through an OHS specialist's report and an expert assessment.
Is an offset made from non-pecuniary damages?
No. The İPSD is offset only against pecuniary damages.
Can an offset be made without an SGK letter?
As a rule, no; an SGK letter is required. If necessary, the court requests a letter from the SGK.
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