Regulatory Updates

  • The law, which increases the minimum wage to TRY 7,500 and the holiday bonus to TRY 2,000, entered into force upon its publication in the Official Gazette on April 5, 2023. It is also worth mentioning that a 30% increase in the minimum wage is expected in the upcoming weeks.
  • The Regulation on the Amendment of the Regulation on the Lines of Business ("Amendment Regulation") was published in the Official Gazette dated May 12, 2023. Accordingly, (i) upon the application of the employer, the employers' union or the workers' union; the lines of business shall be determined. When making the said determination, the Directorate General of Labour may request information and documents it needs from the employer or relevant institutions, call the relevant persons to a meeting and conduct on-site inspections. The Amendment Regulation has entered into force on the date of its publication.
  • The Social Security Institution published a circular dated April 14, 2023, numbered 2023/19 ("Circular"). As per the Circular in the event that retired employees start working subject to social security support premium in the private sector workplace where they last worked, the amount corresponding to five points of the employer's share of the social security support premium will be covered by the Treasury. The relevant provisions of the Circular will be applicable as of March 3, 2023.
  • The Constitutional Court Decision numbered 2021/62 and dated May 4,2023 regarding the amendment of certain articles of the Law No. 5953 on the Regulation of Relations between Employees and Employees in the Press Profession was published in the Official Gazette on June 14,2023. The annulled articles are related to the payment of severance pay to the employee in cases where the employment contract is terminated by the employer.

Miscellaneous Developments

  • Member of the Board of Directors of the Union of Chambers and Commodity Exchanges of Turkey ("TOBB") and Co-Chairman of the Turkish-Bulgarian Chamber of Commerce and Industry Forum Cengiz Günay delivered the opening speech at The Bulgarian-Turkish Business Forum organised by the Bulgarian-Turkish Chamber of Commerce and Industry ("BULTISAD"). The Forum, which was held in Burgas, Bulgaria on 23 March 2023 Thursday, was also supported by the Bulgarian SME Support Agency (BSMEPA). Within the scope of the Business Forum, bilateral meetings were held between Turkish and Bulgarian
  • The Confederation of Turkish Trade Unions ("TÜRK-İŞ") announced the hunger and poverty line data for April 2023. According to the data, the total amount of income that a four-person family should have in the household for food and all other basic expenditures (poverty threshold) is TRY 33,750.
  • 2023 Public Collective Labour Agreements raise rate was announced by the President of the Republic. Among other raise rates, the lowest public worker wage has been raised to TRY 15,000 and overtime wages have been increased by 70%.
  • It was announced that monthly working hours of Social Security Institution ("SSI") employees were increased from 50 to 100 hours because of the increased workload on the SSI due to the high number of retirement applications it had received after the recent law amendment lifting the age requirement for retirement.
  • President of the Confederation of Employers' Associations of Türkiye Özgür Burak Akkol made a statement regarding the interim increase in the minimum wage. He stated that they will endeavour to determine a figure that will meet the expectations of the employee and the employer.
  • Former Minister of Labour and Social Security Vedat Bilgin stated that after the approval of their legislative proposal in the Turkish Parliament, temporary workers will now be able to work for one year and then be appointed to staff as full time workers.
  • Turkish Employment Agency ("İŞKUR"), which provides services through many digital platforms and provides services to job seekers and employers, started to provide services with its mobile application.
  • İŞKUR Gemlik Career EXPO 2023, which is carried out by İŞKUR with the financial support of the European Union and the Republic of Türkiye, and where the Ministry of Labour and Social Security, Department of European Union and Financial Assistance is the Contracting Authority, was held on 06-07 June 2023 at Gemlik Indoor Sports Hall. The event aimed to help attendees make informed career plans based on the characteristics and demands of the labour market, while also promoting the recognition of companies and their human resources policies and attracted approximately 3,500 visitors and featured stands from 51 companies.
  • İŞKUR announced that the agency will provide a TRY 150 thousand grant support to disabled entrepreneurs who seek to start establishing their own According to the decisions taken at the first term meeting of the Commission Authorised to Use the Amounts Collected as Administrative Fines from Employers who do not Employ Disabled and Former Convicted Persons, a TRY 18.1 million support will be provided to 145 projects in this regard.
  • Deputy President Cevdet Yılmaz stated that they hope that employees, employers and the public sector will reach a consensus on the minimum wage. Deputy President Yılmaz said that a 3-year medium-term programme will be prepared in the coming days as a crucial document that includes fiscal policy and structural reforms as well as monetary policy. He further stated that some sectoral policies will be put forward in various fields and that the Türkiye Century will continue to be built with new projects and ideas in many fields from housing to food, energy, transport and technology.
  • Minister of Labour and Social Security Vedat Bilgin attended the ceremony for the White Flag Awards given to unionized enterprises by the Ministry of Labour and Social Security. Stating that businesses that meet certain conditions will be given the "White Flag" and that these businesses will be provided with certain benefits, Minister Bilgin also stated that the White Flag is a practice that will contribute to union organization.
  • Turkish Statistical Institute ("TURKSTAT") announced labour force statistics for April. Accordingly, Türkiye's unemployment rate was recorded as 10.2% in April. In this period, the number of unemployed people increased by 74 thousand people, compared to the previous month and became 3 million 585 thousand people. The unemployment rate, which was 10% in March 2023, was revised to 10.1%. The number of employed people increased by 521 thousand compared to March 2023 and became 31 million 610 thousand, while the employment rate increased by 0.8 points to 48.4%, and average weekly actual working hours decreased by 0.2 hours compared to March 2023 and realized as 44.4 hours.

News From Around the World

  • The European Parliament ("EP") adopted new rules which will make average wages in workplaces in the European Union ("EU") transparent and eliminate the pay gap between male and female employees. It was stated that with the new rules, companies will have to disclose information revealing gender pay gaps and employees will have the right to receive information on salaries in their job category, while salary confidentiality will be lifted.
  • It was announced that, with an agreement between employers and workers' representatives as part of the National Labour Council, it has now become compulsory to give bicycle allowances to those who cycle to work, in Belgium.
  • The Office for National Statistics announced that Britain's labour market has experienced a tightening, with a significant increase in wages and a decrease in unemployment in April. Accordingly, in the three months to April, the unemployment rate fell to 3.8%, contrary to forecasts that it would rise to 4%.
  • The government of Italy approved the decree aimed at reducing the number of people dependent on state benefits and giving more flexibility to the labour market, which will make it easier to hire workers on a short-term basis. Moreover, it was stated that the government will also spend EUR 4 billion on a six-month cut in taxes for low-income earners and is cutting taxes on side benefits for workers with children, reflecting policymakers' growing concerns regarding Italy's low birth rate.
  • It was reported that London's permanent recruitment activity fell at the fastest pace, in April, since January 2021, which was a period when the Covid-19 pandemic was at its climax. On the other hand, the report has highlighted an increase in the hiring of temporary employees, with the growth rate reaching its highest level in three months, primarily driven by a strong demand for nursing, medical, and caregiving positions.
  • National Labour Relations Board ("NLRB"), a US labour board, officially stated that enforcing contracts that prevent workers from joining competing companies (non-compete agreements) is typically against the law, as part of the ongoing endeavours of government regulators to restrict such practices.
  • On June 2, the final bi-annual report on the implementation and impact of the European instrument for temporary Support to Mitigate Unemployment Risks in an Emergency ("SURE") instrument was released. As you may recall, in the year 2020, the EUR 100 billion SURE instrument of the European Commission, which aimed at safeguarding jobs and incomes impacted by the COVID-19 pandemic, aided approximately 31.5 million workers and self-employed individuals, as well as over 2.5 million businesses.
  • New York City introduced a law, Local Law 144, to regulate the usage of the Automated Employment Decision Tools ("AEDTs"), a type of artificial intelligence which is used to match job requirements with relevant keywords found in applicant resumes. It was reported that Local Law 144 would mandate employers to perform bias assessments on automated employment decision systems, including those employing artificial intelligence and similar technological methods.
  • Six aerospace engineering managers were acquitted of charges related to conspiring to limit employee hiring and recruitment in the US. It was reported that this ruling constitutes a setback for the US Justice Department in its ongoing efforts to prosecute antitrust violations in the labour market.
  • On June 11, the Secretary of State for Work and Pensions of the UK announced the expansion of a program which aims to offer employment assistance to individuals with mild to moderate mental or physical health conditions who are unemployed or need support to stay in work. With over GBP 58 million new government funding provided by the program, more than 25,000 people with health conditions will be helped to start and stay in work.
  • The President of France, Emmanuel Macron, signed the pension reform into law on April 15, which raises the retirement age from 62 to 64, despite weeks of strikes and demonstrations organized by trade union representatives against the pension reform.
  • The Council of Ministers in Germany approved the new Skilled Immigration Act, which aims to close the shortage of skilled labour in the country. It was reported that many German companies have been experiencing serious difficulties in finding qualified employees for a long time, with the shortage of qualified employees standing at 1.98 million in 2022. Accordingly, in his assessment, Minister of Labour and Social Affairs Hubertus Heil has stated that securing a qualified workforce is one of Germany's biggest economic tasks for the next 10 years and that they have laid the foundations of a modern immigration country with the new Skilled Migration Act.
  • The European Council agreed on an updated version of the laws on legal migration to the EU labour market. The update is part of the EU's package aimed at attracting talent to the EU. It has been stated that in this way, the EU wants to increase regular migration and bring people into the labour market who will work in the fields and professions it needs. According to the statement made by the Council, the updated version of the "single permit" regulation, which covers both residence and work permits, will facilitate the application procedure. Moreover, with the new regulation, citizens of non-EU countries will have more rights when they are employed in EU and will be treated on an equal footing with EU citizens in terms of labour rights, which will eliminate labour abuse by employers within the EU.
  • International Labour Organization ("ILO") Assistant Director-General and Regional Director for Europe and Central Asia, addressed the Informal meeting of employment and social affairs ministers ("EPSCO"), chaired by the Swedish Presidency of the Council of the EU on ways to prevent a mismatch between skills and jobs in times of transition and underlined the importance of adapting skills policies to anticipate skills needs for future green jobs.
  • The United Nations General Assembly passed a resolution on the social and solidarity economy for sustainable development. The resolution acknowledges the potential of the social and solidarity economy to support the realization and localization of the Sustainable Development Goals ("SDGs").
  • ILO designed a program to aid over 30,000 female entrepreneurs across ten nations in digitalizing their businesses with the assistance of Microsoft Corporation. The Women in Digital Business ("WIDB") initiative seeks to address the gender digital divide and provide customized support services to empower women-owned micro and small businesses, considering their unique cultural, educational, and financial obstacles.
  • Giovanni di Cola, the Officer-in-Charge of the ILO Türkiye mission, along with his delegation, conducted a visit to earthquake-impacted regions in Türkiye on April 3rd and 4th . During this visit, they assessed the needs and examined the ongoing operations in collaboration with local partners, notably İŞKUR (Turkish Employment Agency) and GESOB (Gaziantep Union of Chambers of Tradesmen and Craftsmen). Additionally, they held meetings with various local authorities, including the Governor of Pazarcık, Kahramanmaraş, and the Ambassador of the Ministry of Foreign Affairs in Gaziantep. In collaboration with the Ministry of Labour and Social Services and the social partners, the ILO is currently exploring the possibility of enhancing technical assistance to these organizations. The aim is to facilitate the implementation of decent work programs as part of the recovery efforts following the earthquake-induced disaster.

News From the Private Sector

  • The Federation of German Industries ("BDI") conducted a survey on the production and workload of medium-sized industrial companies operating in Germany. While the survey emphasized the lack of skilled labour in three quarters of German industrial companies, the President of BDI, Siegfried Russwurm, indicated that approximately one out of every 6 industrial companies in Germany moved their production abroad due to high labour and energy costs.
  • Bain & Company and EcoVadis jointly conducted a research titled "Do ESG Efforts Create Value?". The research has indicated that there is a relationship between financial profitability and growth of private companies and sustainability, diversity and employee satisfaction. Moreover, according to the results of the research, companies that employ more women in their management teams achieve better financial results and companies in the top 25% of their industry in terms of gender diversity in their management teams have about 2% higher annual revenue growth compared to companies in the bottom quartile.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.