Employee benefits in Türkiye come under the Labour Code, the Code of Obligations, and the Constitution. Various other Codes apply to specific areas of employment, including social insurance, health and safety and trade unions. Employment legislation applies equally to Turkish nationals and foreigners.
When expanding your company’s presence in a new country, you must ensure compliance with your employment contracts and benefit guarantees. Foreign companies hiring employees in Türkiye must operate within this complex framework of legislation and collective agreements that provide safeguards and guarantees for the workforce.
Foreign companies’ responsibilities reach beyond simply complying with tax, social security, and payroll regulations. Failure to comply with specific rules applying to benefits and entitlements runs the risk of fines and sanctions. Employers must have a firm grasp of what is guaranteed for their employees, which will affect the employer-employee relationship. This is where Bradford Jacobs points you in the right direction, drawing on over 20 years of experience as a Professional Employment Organisation (PEO) and Employer of Record (EOR).
The Constitution of Türkiye, the Labour Code and the Code of Obligations are the primary legislation covering the employer-employee relationship and workers’ rights to compensation, benefits and entitlements. Other Codes also affect specific employment areas. Statutory minimums can also be affected by trade unions and Collective Bargaining Agreements (CBAs). These agreements can improve statutory minimums but not reduce them.
National Minimum Wage (NMW): In July 2022, the NMW was raised for the second time in six months to combat inflation that had reached 74% in May and a 20% drop in the value of the lira since January. The new monthly minimum was TRY 5,500 (EUR 300, USD 306).
Sick Leave and Benefit: Employers are under no statutory obligation to pay sickness or injury pay to employees beyond the second day of incapacity, after which benefit is paid by the Social Security Institution (SSI or SGK) after a doctor has provided a medical certificate. Benefit usually equates to two-thirds or half of the daily gross wage, depending on the type of illness or injury.
Working Hours and Breaks: Under the Labour Code’s Working Time Regulations, regular working hours cannot exceed 45 a week. Hours are usually divided equally between working days unless agreed otherwise, in which case no single working day can exceed 11 hours. The Code stipulates minimum unpaid breaks: 15 minutes for working up to four hours, 30 minutes for between four and seven hours, and one hour for working over seven-and-a-half hours. Part-time, on-call and remote working are also covered by the Labour Code and Code of Obligations and operate by mutual agreement between employer and employee.
Overtime: Restricted to a maximum of 270 hours per year under the Overtime Regulations Code, overtime pay depends on the employee’s typical working week. Employees working 45 hours per week receive 50% above their regular hourly rate for extra hours. Those generally working fewer than 45 hours receive 25% above the standard hourly pay until they exceed 45 hours when the 50% extra applies.
Paid Vacations: Employees who have worked for more than one year, including any probationary period, qualify for the following entitlement:
Public Holidays: Paid vacation allowance does not include the recognized public holidays, which are extra paid days off for employees. Moon sightings determine Islamic holidays. The dates of two official holidays celebrated within Islam, Eid-al-Fitr and Eid-al-Adha, vary between years. Eid-al-Fitr marks the end of the month-long Ramadan, while Eid-al-Adha marks the end of the Hajj. The national holidays in Türkiye are:
Maternity /Paternity / Leave and Benefit: Under Article 74 of the Labour Code, statutory maternity leave is 16 weeks, generally split equally before and after the due date. In multiple births, an extra two weeks is taken before the due date. When a doctor verifies the employee’s good health, they can work up to three weeks before the due date, with the unused leave added to the post-natal period. Employers are not legally required to pay benefits, with employees guaranteed two-thirds of their regular salary from the SSI. Multiple births entitle the mother to an extra six months’ unpaid leave, which the spouse can share. This also applies when adopting a child under three years old. Either parent can switch to part-time work up to two-thirds of standard working time until the child is three years old, but only one can take this option. Fathers receive five days of paid paternity leave from the SSI.
Discrimination: In the workplace, the Labour Code generally prohibits discrimination between male and female employees regarding wages, type of role, promotion, equal opportunities and qualifications. Employers also need verifiable justification for treating differently full- and part-time employees. Beyond this, the Labour Code bars discrimination based on language, race or ethnicity, political or philosophical opinions or beliefs, maternity, membership or non-membership of trade unions.
Termination / Severance / Redundancies: The Labour Code allows termination for cause under specific categories – long-term absence due to ill health; immoral, malicious and dishonourable conduct; force majeure; lack due to arrest or detention. Termination with a cause does not require notice. Still, the employee is entitled to any accrued rights from the employment contract, and severance may be due unless dismissed for immoral, malicious and dishonourable conduct. Under the Labour Code, different provisions apply regarding job security depending on whether companies employ more than 30 employees and whether the employee has more than six months of seniority. Employers and employees can terminate mutually with a settlement agreement.
Labour Code regulations regarding severance are complex but apply only if the employee has worked for more than one year with the employer. Where severance applies, employees receive one month’s salary for each year of work, capped at TRY 10,848 (€592, US603) for each month as of July 2022, with the rate amended twice annually. Fines apply for non-compliance.
In the case of collective redundancies, regulations apply in the following circumstances:
In these cases, the employer must notify the trade union, where applicable, the provincial directorate of the SSI and the Employment Agency at least 30 days before the due date of redundancies.
Notice Periods: There is no requirement for notice periods if termination is with just cause as defined by the Labour Code. In another case, the following minimum periods apply unless improved contractually or by CBAs:
Payment instead of notice is allowed.
Note: The social insurance system in Türkiye is managed by the Social Security Institution (Sosyal Güvenlik Kurumu, SSI or SGK), which operates under the Social Security and Health Insurance Law (GHI).
The Social Security Institution (Sosyal Güvenlik Kurumu, SSI or SGK) administrates the social insurance system in Türkiye and operates under the Social Security and Health Insurance Law (GHI). The health program provides reimbursement for such preventative, diagnostic and remedial procedures. The SSI also contributes to the cost of medicines and treatments.
The system is funded by contributions from employers, employees and federal funds at rates governed by employment categories. Employers generally contribute the equivalent of 20.5% of employees’ payroll. Employees contribute 14% of their salary, of which 9% goes to disability, retirement and life insurance, with 5% to general health insurance. In addition, employers contribute 2% to unemployment insurance and employees 1%. Generally, individuals must contribute for a minimum of 30 days to become eligible for the scheme.