Turkey Employment Law for a Foreign-Owned Employer: Contracts, Probation, Working Time, Notice, Job Security, Severance Pay and What a Turkish Employee Costs in 2026

A foreign-owned company that hires its first employee in Turkey takes on a body of law written for the employee's protection, and the two mistakes I see most often are made before the first payslip. The first is a fixed-term contract used to keep the relationship "flexible": under Article 11 of the Labour Law a fixed term needs an objective reason, and without one the contract is indefinite from the start. The second is a headcount that crosses thirty without anyone noticing that Article 18 has just attached job security to every employee with six months' service, so that a dismissal now needs a valid reason and can end in reinstatement or up to eight months' wages. Behind both sits severance pay, which is owed at thirty days' wage for every year of service on almost every termination the employer initiates, capped at a ceiling that the Treasury resets twice a year. This page sets out the Labour Law No. 4857 as it stands in September 2026, the severance rule that survives from the 1971 law, the mandatory mediation step before any employment suit, and the social security and payroll figures for 2026, for an employer deciding whether to hire directly, through a Turkish company, or not at all.

Sources, checked 9 September 2026. Labour Law No. 4857, Articles 8, 11, 15, 17, 18, 20, 21, 25, 26, 32, 41, 53, 63 and 74 and Provisional Article 6; Labour Law No. 1475, Article 14; Labour Courts Law No. 7036, Article 3; Social Insurance and General Health Insurance Law No. 5510, Articles 81 and 82; Unemployment Insurance Law No. 4447, Article 49; Minimum Wage Determination Commission decision for 2026 (Official Gazette 33119, 26 December 2025); Ministry of Treasury and Finance circular No. 5 of 2 July 2026 on the severance ceiling.

The contract

Article 8 of the Labour Law does not require a form for an employment contract, but a contract for a year or more must be in writing, and where there is no written contract the employer must give the employee, within two months, a written statement of the general and special working conditions, the daily or weekly hours, the base wage and any supplements, the pay period, the term if fixed, and the termination provisions. Article 15 allows a probation clause of at most two months, extendable to four by collective agreement, during which either side may terminate without notice or compensation. Article 11 draws the line that foreign employers most often cross: a fixed-term contract is valid only for work that is itself limited in time, for the completion of a defined task or on another objective condition, and successive fixed-term contracts without an essential reason make the relationship indefinite from the beginning. A foreign employer's standard one-year renewable contract is, in Turkish law, an indefinite contract with a probation period, and should be drafted as one.

Article 32 requires wages, bonuses and premiums to be paid in Turkish lira, at the workplace or into a bank account opened for the purpose; a wage agreed in foreign currency may be paid in lira at the rate on the payment date, which is how a foreign group pays a euro-denominated salary lawfully. The Ministry may require payment through a bank by size and type of employer, and most employers of any size are within that requirement. The payroll account and the company's own banking are described on the bank account page.

Working time, overtime and leave

Article 63 fixes the working week at a maximum of forty-five hours, spread equally over the working days unless otherwise agreed, with a daily cap of eleven hours where the parties agree an unequal spread, and a balancing period of two months, extendable to four by collective agreement, within which the weekly average may not exceed the normal week. Article 41 defines overtime as work beyond forty-five hours a week, paid at the hourly wage increased by fifty per cent, or taken as one and a half hours of free time per hour at the employee's choice within six months; work between a contractual shorter week and forty-five hours is paid at twenty-five per cent above the hourly wage; overtime needs the employee's consent and may not exceed two hundred and seventy hours in a year. Article 53 gives paid annual leave after one year's service, including probation: at least fourteen days for one to five years, twenty for more than five and fewer than fifteen, twenty-six for fifteen years and more, and twenty for employees under eighteen or fifty and over; the right cannot be waived. Article 74, as amended by Law 7578 of 22 April 2026, sets maternity leave at eight weeks before and sixteen weeks after the birth, twenty-four weeks in total, with two further weeks before the birth for a multiple pregnancy and the option, on medical approval, to work until two weeks before the birth and add the unused weeks afterwards.

Termination: notice, valid reason and just cause

There are three doors out of an indefinite contract, and the cost differs at each.

Notice, Article 17. Either party may terminate an indefinite contract with notice of two weeks for service under six months, four weeks for six months to eighteen months, six weeks for eighteen months to three years and eight weeks beyond three years; the periods are minimums and may be lengthened by contract. The employer may pay the notice period's wage in lieu and end the contract immediately. A party that gives no notice owes compensation equal to the notice wage, and where the employee is outside job security, a termination that abuses the right to terminate costs three times the notice period as well.

Valid reason, Articles 18 to 21. In a workplace employing thirty or more people, an employee with at least six months' service may be dismissed on notice only for a valid reason arising from the employee's competence or conduct or from the requirements of the business, the workplace or the work, and Article 18 lists what is not a valid reason: union membership and activity, pursuing legal rights against the employer, race, colour, sex, marital status, family responsibilities, pregnancy, birth, religion, political opinion and the like, absence during protected maternity periods, and temporary absence through illness within the limits of Article 25. Under Article 20 the employee who contests the dismissal must apply to a mediator within one month of the notice, and if mediation fails may sue in the labour court within two weeks of the final mediation record; the burden of proving the valid reason is on the employer. Under Article 21, where the court or arbitrator finds the dismissal invalid, the employer must reinstate the employee within one month of the employee's application, which must itself be made within ten working days of the final judgment; if the employer does not, it pays compensation of at least four and at most eight months' wages, fixed by the court in money at the wage on the date of suit, and in either case the employee receives up to four months' wages and other rights for the period out of work. Notice pay and severance already paid are set off if the employee is reinstated.

Just cause, Article 25. Whatever the term of the contract, the employer may terminate immediately for the health reasons in paragraph I, the breaches of morality and good faith in paragraph II, force majeure that stops the employee working for more than a week, and detention beyond the notice period. Paragraph II is the list that matters in practice: misleading the employer at hiring on an essential qualification, insults and false accusations against the employer or their family, sexual harassment of a colleague, assault or coming to work drunk or under drugs, breaches of trust such as theft or disclosing trade secrets, an offence at the workplace punished with more than seven days' imprisonment without suspension, unexcused absence on two consecutive working days or on the working day after a holiday twice in a month or on three working days in a month, persistent refusal to perform duties after a reminder, and endangering safety or damaging the employer's property beyond thirty days' wages. Under Article 26 the right must be exercised within six working days of learning of the act and in any event within one year of it. A dismissal under paragraph II carries no notice pay and, under the severance rule below, no severance.

Severance pay and the ceiling

Provisional Article 6 of the Labour Law keeps in force Article 14 of the old Labour Law No. 1475, which is where severance pay still lives. The employee is owed thirty days' wage for each full year of service, pro rata for the remainder, where the employer terminates other than for the paragraph II reasons, where the employee terminates for just cause under Article 24, on the employee's military service, on retirement or on completing the insurance period and premium days for a pension, on a woman's resignation within a year of marriage, and on death; the minimum qualifying service is one year. The wage is the last wage, including the money and money's-worth benefits the employee receives by contract or law, so a gross salary with a company car, meal card and regular bonus is calculated on the whole package. The article caps the amount per year of service at the highest retirement bonus payable to the most senior civil servant for a year of service; the Treasury's circular of 2 July 2026 sets that ceiling at 73,729.87 lira for 1 July to 31 December 2026, up from 64,948.77 lira in the first half of the year. A senior manager on a package above the ceiling is owed the ceiling per year, not the package. Late payment carries the highest deposit interest rate from the termination date, and severance up to the ceiling bears only stamp duty, no income tax or social security premium. Successive employment with the same employer, and service transferred with the workplace, count in full.

Before any suit: mediation

Article 3 of the Labour Courts Law No. 7036 makes an application to a mediator a condition of any suit for an employee's or employer's claim or compensation under a contract or the law, and of any reinstatement suit; a suit filed without it is dismissed on procedure, and the final mediation record must accompany the claim. Only compensation claims from work accidents and occupational disease are outside the rule. For the employer this means that most disputes are settled or shaped at a mediation table within weeks of the termination, and that the termination file, the written warnings, the notice letter with its reasons under Article 19, and the payroll records are what the employer brings to that table.

What an employee costs in 2026

The minimum wage for 2026, set by the Commission's decision published on 26 December 2025, is 33,030 lira gross a month, 28,075.50 lira net after the employee's premiums and with the income tax exemption on the minimum wage. The employer's premiums under Article 81 of Law 5510 are twelve per cent for invalidity, old-age and death insurance, the employer's share having risen from eleven per cent by Law 7566 in December 2025, two and a quarter per cent for short-term insurance branches, and seven and a half per cent for general health insurance, together twenty-one and three quarters per cent of the premium base; the employee's shares are nine and five per cent. Unemployment insurance under Article 49 of Law 4447 adds two per cent from the employer and one from the employee, with one per cent from the state. Article 81(ı) has the Treasury pay two points of the employer's invalidity, old-age and death premium for private employers whose filings and payments are on time, and five points for employers in the manufacturing sector until 31 December 2026. The premium base is capped under Article 82 at nine times the daily minimum wage, so premiums on a high salary stop rising at that ceiling. Income tax is withheld on the wage at the progressive rates of Article 103 of the Income Tax Law, and the notice, severance and leave entitlements above accrue on top.

Foreign staff and the founder

A foreign national on the payroll needs the work permit described on the founder work permit page, and the Ministry's wage floors for foreign staff, expressed as multiples of the minimum wage, sit on top of everything above; the five-Turkish-employees rule for each foreign worker is the reason a foreign-owned company's first hires are usually Turkish. The founder who chooses to be an employee of their own company, rather than an owner paid by dividend under the rules on the dividend page, acquires the same protections and the same costs, and closes the twenty-year exemption described on the Law 7582 page. The company that employs is formed under the rules on the company formation page, and its choice of seat matters here too: a producer in a free zone exporting eighty-five per cent of its output pays no income tax on its wages, as explained on the free zone page. Montenegro's equivalent rules, for a group comparing the two, are on the Montenegro employer guide.

Whose side we are on, and how we are paid

The payroll provider is paid per payslip, whatever the contract says. The recruiter is paid on the hire. The employer-of-record that offers to "handle Turkish employment" is paid a percentage of the salary and is itself the employer, with consequences for the permit, the intellectual property and the client relationship that its brochure does not mention. None of them is paid to tell you that the fixed-term contract is void, that the thirtieth employee changes the law, or that the severance accrual on a ten-year manager is a liability on your balance sheet today.

We take no commission or referral fee from payroll providers, recruiters, employer-of-record platforms or insurers, in any form, on any file. The fee you pay us is our only income from your matter, and it does not depend on how many people you hire. Because our position does not move with the headcount, telling you to stay at twenty-nine, or to contract with a Turkish company rather than employ, costs us nothing to say.

One boundary, stated plainly. We are lawyers, not licensed investment advisers, not accountants and not a payroll bureau. We do not run your payroll or tell you whether the Turkish operation will pay. What we protect is the legal position: contracts that are what they say they are, working time and overtime records that survive an inspection, terminations that carry the right reason, notice and file, severance calculated on the right wage and ceiling, and a mediation file that settles on your terms.

Before you hire

Send us the role, the intended term, the salary and benefits, the currency you want to pay in, your planned headcount over two years, and whether any hire is a foreign national. We will tell you which contract form the law allows, what the person will cost each month and on exit, when job security will attach, and how to structure foreign-currency pay, bonuses and confidentiality lawfully. Our company work is described on the company formation page.

What this page does not settle

Collective labour law and unions, occupational health and safety obligations under Law 6331, subcontracting and temporary agency work, non-compete clauses under the Code of Obligations, remote work regulations, and the taxation of expatriate packages are separate subjects. Wage, premium and ceiling figures change each January and July; the figures above are those in force on the date checked.