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Turkey: Minimum Wage Increase Proposed

(Nov. 17, 2015) It was reported on November 6, 2015, that Turkey’s minimum wage is expected to rise to TL1,300 (about US$451) per month, from the current TL1,000, at the beginning of 2016. Currently, there are about five million workers in Turkey who receive the minimum wage. In addition, employers that sign collective bargaining agreements with their employees negotiate a “base wage” according to the minimum wage level. An increase of the net minimum wage by the proposed 30% would therefore affect next year’s collective bargaining negotiations. (Hacer Boyacioğlu, Turkey’s Private Sector Starts New Minimum Wage Calculations, HÜRRIYET DAILY NEWS (Nov. 6, 2015).)

The higher minimum wage would also have an impact on employees who receive slightly more than the current minimum wage, because employers will also have to increase wages by the extra TL300 to keep pace. In addition, to keep the balance between the wages paid to minimum wage earners and to higher-level employees, such as chiefs, foremen, and senior workers, all wages would have to rise as of 2016. (Id.) The net wages of workers in the public sector would also be affected because they are determined with reference to the minimum wage. (Id.)

All the political parties had promised to support a significant increase in the minimum wage as part of their election campaign promises before the November 1 elections. While Prime Minister Ahmet Davutoğlu stated that he would honor the Justice and Development Party (AKP) pledge of a TL1,300 minimum wage, the main opposition Republican People’s Party (CHP) had promised a minimum wage of TL1,500 a month. The government does not itself have the authority to raise the minimum wage; it can propose the increase to a panel responsible for the decision, which brings together national government and state officials and labor union representatives. (Id.)