Business in Turkey

Employee's Consent For Overtime Can Be Taken When Needed

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Employer’s obligation to get the employee’s consent for over time at the beginning of each year is removed by the change on “Regulation on Overtime and Extra Hours”.

As is known it was necessary for the employer to obtain employee's overtime consent at the beginning of every year. In practice employer used to schedules their annual overtime and works at extra hour works in January each year and prepares consent documents and get them signed by employees, citing in the document the conditions determined by Law or the operational necessities. These documents should be kept in employee's personal file.

Changes in Paid Annual Leave Regulation

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According to the amendments on Paid Annual Leave Regulation issued in Official Journal No.30158, dated 18 August 2017;

  • Annual vacation periods may be used in segments by mutual consent, provided that one of the segments cannot be less than 10 days.

  •  For employees of subcontractor; in case the employee continues to work in the same workplace even after the subcontractor changed, their annual vacation period will be determined according to the time worked in this same workplace.

  • Primary employer is under the obligation of ensuring employees of subcontractor are let to use their entitled leave periods, and subcontractor has to submit one of the copies of vacation record book to the primary employer.

  • Vacation periods of employees working in underground work shall be applied by raising 4 days. 

Notification of New Starters - Special Conditions

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New starters must be notified to the SSI by submitting a notice of employment. The declaration (insurance holder employment report) should be submitted online to the authorities one day before the start date at the latest. In case of any delay employer will be liable to administrative fine.

However, there are exceptional cases regarding the notification period of new starters in some conditions and field of business.  insurance holder employment report

Last payment date of July 2017 SSI premiums is extended to 5th September 2017

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As is known last payment date of July/2017 SSI premiums coincide with eve of Feast of Sacrifice, 31st August 2017 which is half day holiday.

Ministry of Labor and Social Security announced that due date for July SSI premium payments 31st August 2017 coincide with eve of Feast of Sacrifice, and employees in public institutions are given half day administrative leave on that date. In order to prevent any confusion and relieve the obligators, last payment date of July 2017 SSI premiums are postponed to Thursday, 5th September 2017.   

Also the due instalment payment of restructured debts are postponed to 5th September 2017.

Tax Reduction for Compliant Taxpayers Starts in 2018

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We have already informed you that the taxpayers who pay their personal income and/or corporate taxes regularly on time will be benefiting from 5% tax discount not exceeding one million TRY in any case.

According to the news we received, Ministry of Finance, Revenue Administration prepared an Income Tax General Communique Draft.

Pursuant to Omnibus Bill (bag law) 6824, the article 121 of Income Tax Law 193 have been rearranged with the heading of “Tax reduction for Compliant Taxpayers. The reduction will be applied to income tax and corporate tax returns that must be filed as of 1st January 2018.

Withdrawal from Private Pension may be Made Difficult

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The main target of the Private Pension System is to improve the welfare level of employees by providing a supplementary income during retirement and also to increase the domestic savings which is crucial for Turkey’s economic growth. However, according to official statistics about 57% of the participants used their right of withdrawal from the system in July.

What is Union Compensation?

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sendikaltazminatUnion compensation is a compensation paid to an employee whose employment contract is terminated due to union membership or participation in union activities. The amount of such payment must be determined by labor court, and cannot be less than the employee’s annual wage.

Union compensation is arranged in article 25 of Trade Unions and Collective Labor Agreements Law No. 6356, dated 18 December 2012.  Implementation of this provision undergone some changes in the past and took its final shape after the Supreme Court ruling in 2014. 

Calculation of Gross Wage in Severance Payment

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As is known qualified employees are paid a severance pay equal to last 30 days’ gross wage for each full year of employment.

An employee receives various types of payments and in kind benefits in addition to his base salary, so the term "gross wage" can be interpreted differently.

When it comes to the wage that will be a base for severance pay, all "vested employee benefits" should be taken into consideration.  Following payments must be included in the calculation of gross wage;

  • Gross base salary,
  • Contractual and statutory benefits in kind provided by employer such as meal allowance, transportation fee,
  • Periodical (annually, quarterly etc.) payments such as premium and bonuses ( that will be added in monthly basis),
  • In case the wage is determined as net in the employment contract, the net amount should be grossed up.

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