Private Pension System has been introduced by Law No. 6740 and entered into force as of 1st January 2017. Workplaces that are in the scope of the law, started to enter into contracts with pension companies and offer pension plans to the employees, on different dates, depending on the number of employees.
Gradual entering had been finalized as follows:
Workplace Number of Staff Gradual Entrance Date
1000 and over 1st January 2017
250 (Inc.) to 999 1st April 2017
100 to 249 1st July 2017
50 to 99 1st January 2018
10 to 49 1st July 2018
5 to 9 1st January 2019
Now with the new Amendment Regulation issued in the Official Gazette dated 27 December 2018, following provisions have come into force.
SCOPE OF THE LAW WIDENED
Turkish employees who are under 45 years of age and working against wage under a service contract (in the scope of Law No. 5510, articles 4/a, and 4/c) will be automatically enrolled in a pension plan.
- New regulation stipulates that young employees under 18 years of age and child employees will be included in the private pension system.
- New registered companies with at least 5 employees shall start deducting Private Pension contribution from the employees as of the first payment in the following year.
- Companies, that were out of scope due to their number of employees were under 5, will start deducting Private Pension contribution from the employees as of the first payment in the following year in case their number of employees increased over 5.
RIGHT OF WITHDRAWAL
As is known, participant employees may have the right of withdrawal from the system within two months.
Employees who withdrew from the system will be re-enrolled in three years. Re-enrolment will be for once only, and the procedure will be announced by the Ministry.
WORKPLACES THAT DELAYED TO ENTER PRIVATE PENSION
As it is stated above, gradual entering for companies with 5 and more employees has been finalized as of 1 January 2019.
Workplaces that missed entering private pension may join until 27 February 2019 without paying any fine.