The additional employment incentive loan is a government-supported measure introduced to encourage private-sector employers to hire extra workers. In effect since 2008, this incentive allows private sector employers who qualify as disadvantaged to employ workers without paying wages for the first three months under certain conditions. The program aims to support businesses in maintaining operations while creating opportunities for job seekers to gain employment.
2021 additional employment incentive loan and calculation is a topic of interest for many private-sector business owners. Under the 2021 scheme, employers who hire workers who will be insured for at least 20 days in the first three months may be exempt from paying Social Security Institution (SGK) contributions and certain taxes during that period. This exemption helps employers sustain business operations while providing employees with formal jobs.
What Is the Additional Employment Incentive?
The additional employment incentive has been available since 2008 and continues to be offered to private-sector employers in 2021. The incentive provides social security premium relief to achieve goals such as increasing registered employment, integrating disadvantaged groups into the workforce, improving regional competitiveness, and promoting strategic investments. The state covers part or all of the employer’s social security contributions for eligible newly hired workers.
Over 20 different incentives and support measures were available in 2021. Introduced in response to economic impacts from the COVID-19 pandemic, the 2021 additional employment incentive announced in March targets employers with fewer than 50 employees and was enacted to protect existing employment and support job growth during controlled normalization following the pandemic.
The measure was approved by the Grand National Assembly of Turkey on May 10, 2021. Its purpose is to preserve current employment levels and encourage new hires by offering monthly support to employers for each eligible insured worker hired in addition to the workplace’s existing insured staff, provided that the support period does not exceed the legally restricted dismissal protection period.
Employers must apply through the e-SGK system to benefit from the support. Note that employers who use the additional employment incentive loan cannot simultaneously claim other overlapping social security premium incentives or discounts for the same employees.
How to Apply for the Additional Employment Incentive Loan
Private-sector businesses seeking to benefit from the incentive must submit an application. To register an employee for the incentive via the support module:
- Open your browser and go to e.sgk.gov.tr.
- Follow the path: e-SGK / Employer / Employer System / Define Insured to Benefit from Incentive and register the worker under the Temporary Article 28 – Additional Employment Support of Law No. 4447.
This registration is completed through the online system and is not handled directly at SGK offices.
How Is the Additional Employment Incentive Loan Calculated?
To encourage employment growth during the COVID-19 period, the additional employment incentive loan calculation in effect from May 2021 works as follows:
- Calculate the premium support amount.
- Multiply the number of premium payment days for the insured person included in the additional employment by 53.67 TRY.
- The result is the amount of the additional employment incentive for that employee.
- If the insured is reported for 30 days, the monthly support would be 30 x 53.67 = 1,610.10 TRY per employee.
How Much Loan Is Provided for the Additional Employment Incentive?
The loan amount available under the incentive varies by sector and is calculated differently for different types of businesses.
For businesses in information technology and manufacturing:
- The daily gross minimum wage for the relevant period is multiplied by the number of insured premium days.
- The incentive loan cannot exceed the result of this calculation.
- For each insured person with a prime-earning base of 7,848.00 TRY, related social security contributions, stamp duty, and income tax amounts to be covered range between 1,103.63 TRY and 2,943.00 TRY, plus 176.84 TRY for stamp and income tax.
- The total support per employee is calculated between approximately 1,280.47 TRY and 3,119.84 TRY.
For businesses in other sectors:
- The incentive is calculated based on the lower earnings limit for each insured, with total premium coverage amounting to 1,103.63 TRY and 176.84 TRY for stamp and income tax.
- The total additional employment support per employee is calculated as 1,280.47 TRY.
The portion covered by the incentive is deducted from the monthly premiums payable to the Social Security Institution and is borne by the Unemployment Insurance Fund.
What Are the Conditions for the Additional Employment Incentive?
Certain requirements apply both to the insured employee and to the workplace for eligibility. The main conditions include:
Conditions for the insured employee:
- The employee must not have been insured under 4A, 4B or 4C for more than 10 days in the three months prior to the start date of the new employment.
- The person must be registered as unemployed with İŞKUR.
- The employment must be between July 1, 2021 and June 30, 2022, as provided by the private-sector employer.
Conditions for the workplace:
- The workplace must belong to a private-sector employer.
- The new hire must increase the average monthly reported premiums and service declarations compared to the previous calendar year for that workplace.
- Monthly premium and service declaration submissions must be up to date and legally on file with SGK.
- Required insurance premiums must be paid within legal deadlines.
- There must be no overdue social security or unemployment insurance premiums, administrative fines, delay penalties, or related debts unless they are subject to an ongoing restructuring or installment plan.
- Employees must be properly declared and actually working at the workplace; any finding of undeclared labor disqualifies the employer.
- Employers with deferred, installment or restructured SGK debts may still benefit from the incentive if the restructuring or installment plan is active.
- Contributions for employed workers must be paid for a 12-month period as required.
- Employers who qualify may receive support for up to five additional insured employees hired under this incentive.
- Premiums for employees hired under the incentive will be deducted from credit interest or profit-share balances until June 30, 2022, and those amounts will be covered by the Unemployment Insurance Fund.
- If an employer has already benefited from another incentive for the same employee, they cannot claim this additional employment incentive for that employee.
What Documents Are Required to Apply?
Employers applying for the incentive must submit certain documents to the Social Security Institution. Required documents include:
- Monthly premium declaration
- Monthly service statement
These documents are submitted to SGK as part of the application process.
Who Can Receive the Additional Employment Incentive?
Eligible recipients and features of the support include:
- Micro and small businesses facing cash flow difficulties can access loans of up to 100,000 TRY per additional employee with a Credit Guarantee Fund guarantee.
- The incentive applies to employees of private-sector employers, excluding workplaces involved in certain public procurement contracts.
- The maximum loan available under the additional employment credit support may be up to 500,000 TRY, with up to 24 months’ maturity and the first 6 months payment-free.
- Employers who meet their employment commitments will have their paid social security and unemployment insurance contributions for each new employee credited against their loan interest balance for up to 12 months.
- Firms can thus obtain low-cost financing for hiring through this support.
- If employers received prior cash wage support, they must meet required conditions to re-employ those workers before applying for the additional employment incentive.
What Are the Advantages of the Additional Employment Incentive?
The incentive offers clear benefits for both employers and employees:
- For employers, the total cost of hiring a worker (minimum wage plus social security and taxes) averages around 3,134 TRY. With the incentive, employers may hire and operate for the first three months without paying these wage costs for eligible new employees.
- During the first three months, the state covers the new hire’s social security contributions and taxes, so the employer does not need to make these payments.
- Sectors such as tourism, construction, and seasonal work can quickly recruit staff and benefit from reduced early-stage labor costs while contributing to employment growth.
How to Check Your Additional Employment Incentive Status
To query the additional employment incentive status:
- Go to sgk.gov.tr.
- Click the E-SGK menu on the page.
- Navigate to Employer → Employer System → Application Login → Employer → Incentives and Definitions → Potential Incentive Inquiry.
- Follow those steps to check eligibility and current incentive status.
This article covered how to apply for the 2021 additional employment incentive loan, how calculations are made, who can benefit, required documents, and the main advantages of the program.