Turkey

The labour market in Turkey

Each labour market has some peculiarities. It may be tricky for foreigners to fully understand the payment methods, taxes, and other benefits related to them. In TalentUp, we are starting a series of different blog articles, one for each country. This article analyses the labour market in Turkey.

Even if the national currency is the Turkish Lira (TRY), the whole article is in EUR to compare easily across countries and exchange rates.

General data about the Turkish labour market

Payroll taxes in Turkey

Social security contributions are made by the employer and the employee and are used for funding unemployment, pension, maternity/paternity leave, and sickness or injury.

Upper limit of Social Security Base: 3,484.06€

Once contributions are paid, employees need to pay an income tax that varies depending on their gross salaries.

Contingencies from self-employees

A self-employed individual is obligated to make advance payments on income tax that will be offset on filing an annual report. The advance payments will be made four times each year. The standard rate for payments in advance of income tax in Turkey is 15% of the net profit.

Example of net salary in Turkey

As a reference, we use the average salary of a software engineer. In Turkey, on average, software engineers earn 24,200€ annually.

The employer contributes 3,484.06€ to social security and the employee contributes 3,484.06€.

After paying the income tax, the employee has a net salary of 14,975.22€, coming from a gross salary of 24,200€. 

Unemployment regulation in Turkey

In Turkey, the notice period is dependent on the employee’s length of service, as below:

Employees are entitled to severance pay upon completing one year with the same employer. The formula for calculating severance pay is to multiply the monthly wage by the number of completed years of employment.

The probationary period usually lasts for 2 months and no notice period is required.

Different kinds of leaves in Turkey

Paid annual leave depends on the years worked. It ranges from 14 to 26 days. Moreover, there are 14 public holidays. However, if they fall on weekends, they are lost.

​​Religious holidays are determined by the lunar cycle and will show as ‘tentative’ until they are confirmed nearer the date of the holiday.

Employers are not strictly obligated to provide payment to employees during sick leave. However, typically, employees receive compensation from Social Security after a three-day sick leave period. In reality, many employers decide to pay their workers their regular salary for the first two days of sick leave, which Social Security does not cover, or for the entire sick leave period. They may then receive a partial refund when Social Security reimburses them.

If an employee’s sick leave extends beyond six weeks beyond the notice periods outlined in labour law, the employment contract may be terminated without prior notice. This is in accordance with Article 46(c) of the Turkish Labour Code.

Parents are also entitled to up to 10 days of leave to attend treatment or medical appointments for a child with a disability or chronic disease.

More over, there is a bereavement leave of 3 days and a ilitary leave of 90 days, both paid leaves.

Paid parental leave

Maternity leave lasts for 16 weeks (18 in multiple or complicated births) at full pay. Usually, they are 8 weeks before and 8 weeks after birth, but it can also be three before and five after.

Depending on how many children the employee has (in total), employees can work some months part-time after their leave. It goes from 2 months to one year.

The father/partner is entitled to 1 week of paid paternity leave after the child’s birth.

If both parents are employed, they are entitled to work part-time until the child starts primary school. 

Other common Turkish benefits

How to employ a Turkish worker

To hire in Turkey, you need to be a registered company. And for this, you need:

• A title of company and Articles of Association (AoA),
• Personal information and passport copies of the shareholders and directors,
• Proof of address for the shareholders and directors,
• Proof of the capital amount, its source and existence
• Tax Identification Numbers (TIN) for the shareholders and directors,
• A Registration and Commercial Activity Certificate.