Hiring Employees in Turkey: A Guide for Foreign-Owned Companies

Employing in Turkey: Overview

Turkey has a well-developed labor law framework under Labor Law No. 4857, which provides strong protections for employees including minimum wage requirements, notice periods, severance pay entitlements, and job security provisions. Foreign-owned companies are subject to the same rules as Turkish employers.

Understanding Turkish labor law before your first hire will help you avoid costly mistakes and maintain good employment relationships.

Step 1: Pre-Employment Requirements

Before hiring your first employee:

1. Company must be registered — valid Trade Registry certificate and tax registration
2. SGK employer registration — register as an employer with the Social Security Institution (SGK) before the first employee starts. See our Social Security Registration guide
3. Register the workplace with SGK and obtain a workplace registration number (işyeri sicil numarası)

Step 2: Employment Contracts

Written employment contracts are not strictly mandatory for all employment relationships, but are strongly recommended and required for:

• Fixed-term contracts
• Part-time contracts
• Contracts in languages other than Turkish (contract must be in Turkish or have a Turkish version)

Key Contract Terms

A Turkish employment contract should include:

Step 3: Minimum Wage

Turkey’s minimum wage (asgari ücret) is set by the Minimum Wage Determination Commission and adjusted twice per year — in January and July. For 2026:

• Verify the current gross minimum wage at çsgb.gov.tr — as a benchmark, gross minimum wage exceeded 26,000 TRY/month as of early 2026
• Employers cannot pay below the minimum wage
• The minimum wage applies to all employees regardless of nationality or visa status

Working Hours

• Standard working week: 45 hours maximum (typically 9 hours/day, 5 days/week)
• Overtime: Permitted with employee consent, paid at 1.5× the regular hourly rate (or compensatory time off)
• Maximum overtime: 270 hours per year per employee

Annual Leave

Minimum annual leave entitlement under Turkish Labor Law:

Annual leave cannot be substituted for cash payment (except on termination). Managers can set leave schedules but employees must take their leave.

Notice Periods

When terminating an employment contract without just cause, the employer must give notice (or pay wages in lieu):

The employer can terminate immediately by paying the employee’s wages for the notice period without the employee working that period (ihbar tazminatı — notice compensation).

Severance Pay

Severance pay (kıdem tazminatı) is payable when:

• The employer terminates the employee without just cause (valid/just cause is defined in Labor Law Art. 25)
• The employee resigns for specific protected reasons (compulsory military service, retirement eligibility, marriage for women, etc.)
• Employment ends due to the employee’s death

Amount: 30 days gross wage per year of service (pro-rated for partial years)

The severance pay ceiling is 30 days’ gross wage capped at a statutory maximum (verify current ceiling at çsgb.gov.tr).

Example: An employee with 5 years of service earning 40,000 TRY gross/month is entitled to approximately 200,000 TRY in severance (5 × 40,000 TRY), subject to the cap.

Job Security (Feshe Karşı Güvence)

For companies with 30 or more employees and for employees with 6+ months of service, Turkish job security provisions apply:

• Termination requires a valid reason (economic necessity, work performance, or behavior)
• Employees can contest termination at court
• If the court finds termination invalid, the employer must either reinstate the employee or pay compensation (4–8 months’ wages)

Companies with fewer than 30 employees can terminate employees without specific justification (but still must pay notice and severance if applicable).

Payroll Processing

Gross to Net Calculation

Each employee’s net pay is calculated by deducting from gross wages:

1. Employee SGK contribution (14% of gross)
2. Employee unemployment insurance (1% of gross)
3. Income tax (progressive rates applied after deductions)
4. Stamp duty on wages (0.759% — verify current rate)

Payslip Requirements

Employers must provide employees with a payslip (bordrolu ödeme belgesi) each pay period showing all deductions and net pay.

Electronic Wage Payments

All wages must be paid via bank transfer (not cash) for employees in companies with 10+ employees. Bank payment evidence is important for SGK compliance.

Hiring Foreign Employees

Work Permit Requirement

Foreign nationals who are not EU or EEA citizens must obtain a work permit before starting employment. The employer applies on behalf of the employee to the Ministry of Labor through the e-Permit system.

Processing time: 4–8 weeks. See our Work Permit Types guide for details.

Foreign Worker Ratio

Turkish law limits the proportion of foreign workers in a company’s workforce. Generally, foreign employees cannot exceed 20% of total employees (with some exceptions for specific roles or investment-incentivized companies).

Minimum Capital Requirement for Work Permit

For a company to sponsor an initial work permit, the company must meet minimum paid-up capital or turnover requirements (currently 100,000 TRY paid-up capital or 800,000 TRY turnover — verify at çsgb.gov.tr).

Practical HR Tips for Foreign-Owned Companies

• Draft employment contracts in both Turkish and English for clarity, but ensure the Turkish version governs
• Establish clear HR policies and distribute an employee handbook
• Document all performance-related discussions — if job security provisions apply, a paper trail is essential for termination defense
• Engage a local HR consultant or employment lawyer for initial setup
• Budget carefully for total employment cost (salary + 22.5% employer SGK/unemployment + severance accruals)

Frequently Asked Questions

Can I hire an employee on a trial (probationary) period? Yes. Turkish Labor Law allows a probationary period of up to 2 months (extendable to 4 months by collective agreement). During the probationary period, either party can terminate without notice or severance.

Do I need to provide health insurance to employees? All employees registered with SGK automatically have general health insurance coverage through the SGK system. Employers are not required to provide supplementary private health insurance, though many companies offer it as a benefit.

What happens if I terminate an employee and they claim unfair dismissal? For companies with 30+ employees and employees with 6+ months’ service, unfair dismissal cases go to labor courts (iş mahkemesi). If the court rules in the employee’s favor, the employee must be offered reinstatement within 1 month. If the employer declines, they pay 4–8 months’ wages as compensation in addition to notice and severance.

Are non-compete clauses enforceable in Turkey? Non-compete clauses are permitted under Turkish Labor Law (Art. 444–447) but must be limited in duration (maximum 2 years), geographic scope, and industry. Overly broad clauses may be reduced or voided by courts. Non-compete clauses must be written, and compensation to the employee is considered good practice.