Turkey: New Minimum Wage

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(Jan 03, 2011) Turkey's Minimum Wage Commission announced on December 28, 2010, that the country's new minimum wage as of January 2011 will be TL796.50 (about US$515) a month, making the monthly net after-tax income of minimum wage earners TL629.96 (about US$406). In addition, in the second half of 2011 the gross minimum wage is set to be increased to TL837 (about US$540), resulting in a net take-home pay of TL655.57 (about US$423). The increase reportedly fell short of expectations and disappointed workers and employers alike; as one news report pointed out, "[t]he current increase will be enough to buy an extra egg a day or 11 grams of meat." (New Minimum Wage Is Way Under Poverty Line, AYŞE KARABAT (Dec. 30, 2010), available at http://www.todayszaman.com/news-231065-new-minimum-wage-is-way-under-pov
erty-line.html.)

In the view of some Turkish economic experts, the minimum wage issue is a structural problem in Turkey, to be solved by such measures as the introduction of regional minimum wages that would better match various costs of living and the exemption from all taxes of salaries at the minimum-wage level. (Id.) According to economist Cemil Ertem, "[i]income tax and other deductions, which are done in the name of the employer, are making minimum wages lower than they are" and many employers are forced by the system "into operating in the unregistered economy to avoid paying higher taxes." (Id.)

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Last updated: 01/03/2011