Structuring employment contracts and salaries in Turkey correctly is crucial for any business hiring locally. Whether you’re a multinational entering the Turkish market or a local startup expanding your team, compliance with Turkish labor laws is not optional—it’s essential. A well-drafted employment contract not only ensures legal compliance but also fosters transparency, minimizes disputes, and protects both employer and employee rights.
In this guide, we’ll explore how to legally and effectively structure employment contracts and salaries in Turkey, including mandatory clauses, gross vs. net salary concepts, common benefits, and legal obligations in 2025.
1. Legal Basis for Employment Contracts in Turkey
The main legislation governing employment in Turkey is the Turkish Labor Law No. 4857, which outlines the minimum standards for employment relationships. The law applies to all private sector employees, regardless of nationality, as long as the employment occurs within Turkish territory.
For specific cases, such as foreigners, remote work, or freelance arrangements, additional laws or international agreements may apply.
2. Types of Employment Contracts in Turkey
Employment contracts in Turkey can be structured in several formats, depending on the needs of the business and the nature of the work:
a. Permanent (Indefinite-Term) Contracts
- Most common type
- Continues until terminated by either party
- Must include notice periods and severance terms
b. Fixed-Term Contracts
- Ends on a specific date or project completion
- Must be justified with a business need
- Cannot be renewed more than once without turning into a permanent contract
c. Part-Time or Remote Work Contracts
- Clearly defined working hours per week (less than 30 hours)
- Must include telework arrangements and availability rules for remote employees
d. Trial or Probationary Contracts
- Can last up to 2 months (extendable to 4 months via collective agreement)
- Either party may terminate without notice during this period
All contracts exceeding one month in duration must be in writing, in accordance with Turkish law.
3. Mandatory Clauses in a Turkish Employment Contract
To ensure compliance and clarity, employment contracts in Turkey must include the following minimum information:
- Full names and addresses of employer and employee
- Job title and responsibilities
- Start date and (if applicable) end date
- Working hours and location
- Gross monthly salary and payment schedule
- Leave entitlements (annual leave, sick leave, public holidays)
- Social security and tax deductions
- Notice periods and termination procedures
- Severance conditions
- Dispute resolution mechanism
Optional additions:
- Confidentiality and non-compete clauses
- Bonus structures and commission schemes
- Expense reimbursement policies
- Overtime pay rates
4. Gross vs. Net Salary in Turkey
One of the most critical parts of structuring salaries in Turkey is understanding the difference between gross and net salary.
Gross Salary
This is the total amount agreed upon in the contract before taxes and social security deductions.
Net Salary
This is the take-home pay an employee receives after all legal deductions are made.
Common Deductions from Gross Salary:
- Social Security (SGK): ~14% employee share
- Unemployment Insurance: 1% employee share
- Income Tax: Progressive from 15% to 40%
- Stamp Tax: 0.759% of gross salary
Employer Costs
In addition to the gross salary, employers pay:
- ~20.5% to 22.5% for SGK contributions
- 2% unemployment insurance
- Any agreed bonuses or fringe benefits
5. Sample Salary Calculation (2025)
Let’s consider an employee with a gross monthly salary of 50,000 TRY:
- Income Tax: ~7,000 TRY
- Social Security + Unemployment: ~7,500 TRY
- Stamp Tax: ~379 TRY
➡️ Net Salary (Take-home): approx. 35,121 TRY
➡️ Employer’s Total Cost: ~61,000–62,000 TRY
This illustrates how the employer’s cost is significantly higher than the net salary. Clear communication of gross vs net in contracts avoids misunderstandings.
6. Benefits and Allowances
In addition to base salary, many Turkish employers offer fringe benefits, some of which are optional, while others may be customary or expected in certain industries.
Common Allowances:
- Meal card or lunch allowance
- Transportation stipend or company shuttle
- Private health insurance
- Mobile phone and internet costs (for remote roles)
- Holiday bonuses or profit-sharing schemes
13th Month Pay?
Turkey does not have a legal requirement for a 13th-month salary, but some employers offer annual bonuses based on performance or seniority.
7. Working Hours, Overtime, and Leave
Working Hours
- Standard workweek: 45 hours
- Usually spread over 5 or 6 days
- Any time beyond 45 hours/week is considered overtime
Overtime Pay
- Must be compensated at 150% of the hourly rate
- Annual limit of 270 overtime hours per employee
- Alternatively, compensatory time off may be granted
Annual Leave
- 14 days minimum after 1 year of service
- Increases to 20 days after 5 years, and 26 days after 15 years
- Not including public holidays or weekends
8. Termination and Severance Pay
Notice Periods
Unless dismissed for just cause, notice periods are:
- 2 weeks (up to 6 months of service)
- 4 weeks (6–18 months)
- 6 weeks (18–36 months)
- 8 weeks (over 3 years)
Severance Pay
Employees terminated without cause and with at least one year of service are entitled to 30 days’ gross salary per year of employment.
Make sure severance policies are clearly stated in the employment contract.
9. Language and Format
All employment contracts in Turkey must be in Turkish to be legally binding. If the employer is a foreign company, a bilingual version (Turkish + English) is common, but the Turkish version prevails in case of disputes.
Contracts should be signed in duplicate and retained in the employee’s personnel file, which is required by Turkish labor law.
10. Best Practices for Structuring Employment Contracts and Salaries
- ✅ Be transparent about gross and net figures
- ✅ Clearly define job expectations and working hours
- ✅ Specify all types of compensation: bonuses, commissions, benefits
- ✅ Keep contracts updated with law changes and promotions
- ✅ Use legal counsel or local HR consultants for compliance
- ✅ Ensure proper registration with SGK and tax authorities upon hiring
A Solid Employment Structure Protects Everyone
Structuring employment contracts and salaries correctly in Turkey is more than a legal formality—it’s a strategic business necessity. By clearly outlining the terms of employment and complying with Turkish labor laws, you create a professional, trustworthy environment for your team.
Whether you’re a foreign company entering the Turkish market or a local business looking to grow, a well-drafted contract and transparent salary structure are the foundation for long-term success.
Need help drafting compliant contracts or managing payroll in Turkey?
Get in touch with our team for expert HR and legal support tailored to your business.
