The minimum wage in Turkey is the gross wage that shows the minimum amount that a worker in Turkey should receive in return for his thirty days of work. As the country is implementing a national single-rate minimum wage, the minimum wage determination consists an important change for all employers wherever they operate in Turkey or whichever economic sector they are operational in.
According to the legal rules, the minimum wage of Turkey is determined by the Minimum Wage Determination Commission, which consists of labor unions, employers’ unions and public representatives.
The minimum wage applied in the country was being increased on the date of 1st of July 2022 and the net minimum wage was increased to TRL 5,500. Considering the current exchange rate, the minimum wage that can be paid to a full-time worker in Turkey till the end of 2022 is USD 296 net.
According to the Turkish Labor Law, it is essential to determine the minimum wage on a daily basis. “Monthly” and “Hourly” fees are calculated over the daily account. The standard weekly working hour is 45 hours in the country, which is 7 hours and 30 minutes per day, if it is evenly distributed, assuming only one day off is given to the other days of the week.
A “net minimum wage” is paid to the worker by deducting the taxes paid to the state. In short, the minimum wage is one of the basic elements of labour life in Turkey and its implementation represents the lowest limit for wages. In the country where there are approximately 17 million employees, more than 6 million employees work over the minimum wage limit and are reported to the Social Security Institution in this way.
For the calendar year of 2023, a high amount of minimum wage increase is expected as a regulation that will significantly affect employers. President Recep Tayyip Erdoğan made a statement on the minimum wage to be effective as of January 1, 2023 in his statement dated October 19, 2022, and said, “We are determined to compensate for the loss of welfare experienced by our fixed income citizens due to rising inflation. We will continue to fulfill our promise of compensation with our new budget next year.”
There is an expectation that there will be an increase between 50 and 80 percent in the gross and net amount of the minimum wage. Expectations are that the minimum wage gross amount will be increased to at least 10 thousand TL. In case of a high rate of minimum wage increase on January 1, 2023, it is expected that the same amount will not be increased in the second half of the year.
As the national minimum wage covers almost one third of total number of employees in Turkey and as the national minimum wage has become an indicator for all employees for assessing the value of their own wages, the minimum wage consists an important issue in terms of the burden of employment on the employer in Turkey. Thus, it is highly recommended that all employers consider the high probability of a high rate of increase when preparing their 2023 financial accounts and budgets.
