Turkish Labor Law
The sudden depreciation of the Turkish lira in the summer of 2018 forced the Turkish government to take certain measures. Restricting payment of salaries in foreign currency was one of the measures to reverse the situation.
In October 2018, “Communiqué on the Protection of the Value of Turkish Currency” was published in the Official Gazette. The regulation titled “Foreign Currency and Foreign Exchange Indexed Contracts” consisted of 25 items covering a wide range of restrictions from real estate to employment contracts, from electronic communications network to vehicle sales. Among those, the use of foreign currency in many areas was restricted or even completely abolished. Particularly, there was a restriction on payment of salaries in foreign currency. It is stated that a Turkish employee could not receive a salary in foreign currency working for a Turkish company.
However, there are certain exemptions for foreign companies and foreign workers. While foreign companies can pay their salaries in foreign currency, foreign employees can add “foreign currency salaries” to their employment contracts.
Who Cannot Get Paid in Foreign Currency? What are the Conditions?
- Persons residing in Turkey, except for work contracts to be fulfilled abroad
- Contracts abroad 50% owned by persons residing in Turkey
- In service contracts, including consultancy, transportation and brokerage, the contract price and other payment obligations arising from these contracts cannot be determined in foreign currency or indexed to foreign currency.
Who Can Be Paid in Foreign Currency?
- Foreign national employees residing in Turkey
- Contracts by people living abroad whose representative offices, liaison offices, directly or indirectly, 50% or more owned companies operating in Turkey
- Contracts related to electronic communications services starting in Turkey or abroad and ending in Turkey or abroad.
Click here for the notification published in the Official Gazette.
https://www.resmigazete.gov.tr/eskiler/2018/11/20181116-8.htm
