HIRING EMPLOYEES IN TURKEY AS A FOREIGN COMPANY
When hiring employees in Turkey, there are several routes which an employer can choose from. In order to comply with employment regulations, foreign companies can establish a legal entity or branch office in Turkey or can get Professional Employer Organization (PEO) services from a third party. Depending on the agreement, in some cases, third parties can ensure compliance with legal obligations which are mentioned below on behalf of the employer.
What are the responsibilities for employers while they are hiring in Turkey?
Turkey’s main employment compliance law is Turkish Labor Law No. 4857. Besides the main labor law regulations, the obligations and responsibilities of employers are also regulated by Occupational Health and Safety Law N. 6331, Social Security and General Health Insurance Law N. 5510 and Law on Protection of Personal Data N. 6698 etc.
In terms of Turkish Labor Law
The most important obligation of the employer is to comply with labor contracts and Labor Law No 4857. Some of their other responsibilities are as follows;
· to know employee’s statutory rights
· to sign an employment contract
· to provide certificate of employment for the leaving employee
· to allow the employee to use their use their annual leave
· to pay to the employee fully and on time
· to give the worker rest time depending on the needs of the field and work
· arranging a personnel file for who works for during the establishment
In terms of Turkish Social Security System
In many stages of employment, notifications must be made to the authorities within certain time limits. Employers who do not comply with these time restrictions specified in the law may be fined or lost their grants that is given by state.
The following notification must be made to Social Security Institution (“SSI”) in time;
· must inform the Social Security Institution about new employees at least one day before the employee starts working.
· full salary of employee
· starting and leaving notifications must be reported
· Employees who receive temporary disability allowance from the SSI should be informed within the time limits specified by law,
· Social security contributions must be paid on time
In terms of Turkish Tax Law
Employers are responsible for employees’ taxes. Taxes deducted from the taxable income of the employees must be reported within the periods specified in the Income Tax Law and paid to the tax offices.
In terms of protection of personal data
All legal persons (including employers) who collect, process and transfer personal data are considered as "Data Controllers" and are required to take some precautions while working with this data.
Employers are required to respect the personal data of their employees and take all necessary precautions in accordance with Law on The Protection of Personal Data N. 6698. In case of non-compliance within data protection law employers may face fines.
Can a foreign company get professional employment service in Turkey?
Foreign employers who is not based in Turkey can hire employees by getting professional employment services in Turkey. In practice, it is observed that many foreign companies get PEO services when they do not prefer to have a legal entity, work on a specific project with a defined period or like to test the market before they establish a legal entity in Turkey. In this case, all requirements and task of the employer are fulfilled by the third-party organizations.
It is not easy to manage employees for the both domestic and international companies particularly in Turkey where rules and regulations are highly developed and strictly enforced. Accordingly, Cosar & Akkaya offers tailored advice with a deep understanding of Turkish Labor Laws and regulations.
Our services involve:
· Preparing all required documents for our clients and managing their business processes in accordance with the law, regulations and legal timespan.
· Ensuring compliancy with the local regulation in payroll and all relevant processes.
· Concluding the complaints for our clients throughout the employment process such as new hires and termination.
· Assisting to global companies for the purpose of meeting their demands in Turkey.
CA LAW FIRM will be happy to assist you in your inquiries related to PEO services in Turkey. Please contact us by clicking this link.