Turkish Labor Law
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Private Pension System, which is complementary to the mandatory state social security scheme in Turkey has been introduced by Law No. 6740 and entered into force as of 1st January 2017.
Turkish citizen employees who are under the 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 arranged by employers. Participant employees may have the right of withdrawal from the system within two months.
The details concerning application of the Law is becoming clearer by issuance of regulations one after another. We have already inform you about the new developments and outlines of Private Pension in our recent article: http://datassist.com/blog/130-gradual-implementation-in-turkish-private-pension
Now with the Cabinet Decree No. 2017/9721, dated 1 January 2017 following points are also clarified.
Gradual entrance for the workplaces
Workplaces will start to enter into contracts with pension companies and offer pension plans to the employees in the scope of Law on different dates, depended on their number of employees.
Premium contribution base and deductions
- Participants’ minimum contribution amount will be 3% of their earning subject to premium. It will be possible to contribute more than this amount.
- Digits after the comma will not be taken into calculation.
- Deduction will be made from the net salary of employees.
