Turkey is an attractive market for businesses looking to hire skilled professionals thanks to its young population, strategic location, and cost-effective labor force. However, navigating the Turkish recruitment landscape and managing employee salaries comes with specific challenges—ranging from legal compliance and inflation to talent retention and salary transparency.
In this article, we’ll explore the top challenges in recruitment and salary management in Turkey in 2025, and offer practical solutions to help companies overcome them.
1. Rapidly Changing Labor Laws and Wage Regulations
The Challenge
Turkey’s labor regulations—especially those governing minimum wage, social security contributions, and tax brackets—are frequently updated to reflect inflation and economic pressures. These changes can significantly affect payroll calculations and employment contracts.
For example, the minimum wage has doubled in the past two years, with mid-year updates now becoming standard.
How to Overcome It
- Stay informed by regularly checking updates from the Turkish Ministry of Labor and Social Security (Çalışma ve Sosyal Güvenlik Bakanlığı).
- Use local payroll software or partner with a payroll outsourcing firm that automatically integrates legal changes.
- Review and update employment contracts and salary structures at least twice a year to ensure compliance.
2. Talent Shortage in High-Demand Sectors
The Challenge
Turkey faces a shortage of skilled professionals in sectors like IT, engineering, healthcare, and fintech. While universities produce a large number of graduates, not all meet the practical skill expectations of employers—resulting in a skills mismatch.
Moreover, brain drain (highly skilled workers moving abroad) has intensified competition for top local talent.
How to Overcome It
- Invest in upskilling and training programs for junior hires.
- Partner with universities for internship pipelines.
- Offer remote or hybrid roles to attract Turkish talent living abroad.
- Consider Employer of Record (EOR) services to tap into talent beyond major cities like Istanbul and Ankara.
3. Currency Fluctuations and Inflation
The Challenge
The Turkish lira has experienced high volatility in recent years, leading to increased living costs and concerns about salary adequacy. As a result, employees often expect frequent salary revisions or demand to be paid in foreign currency (USD/EUR), especially in multinational companies.
This can create budgeting and payroll planning issues for employers.
How to Overcome It
- Offer inflation-indexed raises or regular salary reviews (every 6 months).
- Structure compensation to include performance bonuses or non-cash benefits like meal cards, transport, or health insurance.
- In some cases, peg salaries to USD or EUR, while paying in TRY at the exchange rate of the payment date (legal with proper contract clauses).
- Monitor cost-of-living changes to remain competitive.
4. Salary Transparency and Gross vs Net Confusion
The Challenge
Many job candidates in Turkey are unclear about the difference between gross and net salary. This often leads to confusion during hiring and dissatisfaction post-onboarding when net income doesn’t match expectations.
Employers also face the challenge of explaining complex deductions like SGK, income tax, and stamp tax.
How to Overcome It
- Use salary calculators to clearly present both gross and net figures during the recruitment process.
- Educate HR teams and recruiters to explain deductions and employer contributions.
- Ensure payslips are detailed, transparent, and include itemized deductions.
- Maintain open communication about salary expectations from the first interview.
5. High Turnover Rates and Retention Issues
The Challenge
Attracting talent is only half the battle—retaining employees in a competitive market is even harder. Many Turkish professionals, especially younger workers, are quick to change jobs for even marginal salary increases or international opportunities.
Retention is further complicated by burnout, limited career advancement, and poor work-life balance in some sectors.
How to Overcome It
- Conduct regular salary benchmarking and keep compensation competitive.
- Offer career development plans, mentorship, and training opportunities.
- Encourage a healthy work-life balance with flexible schedules or remote work.
- Build a strong employer brand through employee recognition and transparent leadership.
6. Difficulty in Attracting Foreign Talent
The Challenge
Hiring foreign professionals can help bridge local talent gaps, but the work permit process in Turkey can be time-consuming and restrictive. Employers must meet several requirements, including:
- A quota of five Turkish employees per foreign worker
- Minimum salary thresholds for foreign hires
- Proof that the role cannot be filled by a local
These rules limit flexibility and discourage hiring international talent unless absolutely necessary.
How to Overcome It
- Plan foreign hires well in advance and allocate resources for permit applications.
- Work with immigration consultants or HR service providers experienced in Turkish labor law.
- Use freelancers or remote contractors outside Turkey when possible (note: they must not perform work physically within Turkey).
- Consider setting up dual contracts for senior expats: one local (for taxes) and one international (for additional compensation).
7. Inconsistent Recruitment Processes Across Regions
The Challenge
While hiring in Istanbul or Ankara may seem straightforward, regional inconsistencies can pose challenges. Labor supply, salary expectations, and recruitment channels vary significantly between regions like the Aegean, Southeastern Anatolia, and Eastern Turkey.
Companies unfamiliar with these nuances may face delays or hire underqualified staff.
How to Overcome It
- Customize your recruitment strategy per region, including salary offers and job platforms.
- Work with local recruitment agencies who understand the market.
- Implement standardized interview and evaluation processes to ensure fairness across regions.
- Use centralized HR systems for tracking applications and managing candidate pipelines.
8. Compliance Risks in Salary and Contract Management
The Challenge
Failure to follow Turkish labor laws can lead to fines, lawsuits, or bans on hiring foreign staff. Common mistakes include:
- Using verbal agreements instead of written contracts
- Not registering employees with SGK
- Misclassifying employees as independent contractors
- Underreporting gross salary to reduce taxes
How to Overcome It
- Ensure written contracts are signed before work begins (bilingual if needed).
- Use a local legal advisor to review employment terms and ensure compliance.
- Register all hires with SGK and the tax authority.
- Avoid “off-the-books” salary practices, which are illegal and risky.
- Archive payslips, tax receipts, and contracts for at least 10 years.
9. Complexity of Bonus Structures and Performance Pay
The Challenge
While fixed salaries are easy to manage, many companies struggle with setting up and managing variable pay structures like performance bonuses, sales commissions, and annual incentives. Without clear criteria, such systems can lead to confusion or dissatisfaction.
How to Overcome It
- Define performance metrics clearly in the employment contract or company handbook.
- Link bonuses to measurable KPIs (sales, revenue, project completion).
- Create a transparent bonus calculation formula that is reviewed annually.
- Keep detailed records and reflect bonuses on payslips to avoid legal disputes.
Navigating Recruitment and Salary in Turkey with Confidence
Recruiting and managing salaries in Turkey involves navigating a unique combination of regulatory, economic, and cultural challenges. However, with the right tools, up-to-date knowledge, and local expertise, companies can build compliant, competitive, and motivated teams.
By understanding the most common recruitment and payroll obstacles—and proactively solving them—you can gain a significant edge in Turkey’s dynamic and fast-changing employment market.
Need help with recruitment or salary compliance in Turkey?
Contact us for expert advice, local payroll solutions, or support with hiring top talent across Turkey.
