With July approaching, debate resurfaced over whether an additional raise will be applied to the minimum wage. President Recep Tayyip Erdoğan settled the question. In its election manifesto, the AK Party emphasized that workers and pensioners would not be crushed by inflation, and that in addition to the minimum wage, civil servants and retirees would receive increases above inflation to improve their financial comfort.
All Eyes Turn to July
According to a report by Hazal Ateş in Sabah, an increase to the minimum wage in July has been confirmed. As always, six-month inflation will be decisive for any mid-year increase. Various scenarios are being discussed, including increases of 20%, 30%, and 40%. Under a 20% rise, the gross minimum wage would be 12,010 lira and the net 10,207 lira. A 30% increase would yield a net 11,057 lira and a gross 13,010 lira. If the rise reaches 40%, the net would be 11,908 lira and the gross 14,011 lira. Approximately 7.131 million workers earn the minimum wage, which accounts for 41% of total insured employees. Because an increase affects many cost items and payments, the minimum wage decision indirectly concerns the entire population.
Compensation Payments Will Rise Too
The last minimum wage increase took effect at the beginning of 2023, in January. With the new minimum wage to be set in July, many items in employment and social security will be recalculated, not only the wage itself. Severance pay, the lowest notice pay, and breastfeeding allowances will also increase. As a result of the July raise, severance payments will be calculated based on the most recent gross salary. For those leaving employment, calculations will use the gross amount of the new minimum wage established in July.
The minimum wage is set to cover all sectors, and employers are prohibited from paying below that level. Because an increase in the minimum wage affects many groups—from employers and general health insurance holders to voluntary insured persons and domestic workers, and from those receiving unemployment insurance to people performing domestic and international debt repayments—the adjustment is widely anticipated.
Not only will the wages of minimum-wage earners rise, but their severance and notice pay amounts will increase as well. The ceilings for unemployment benefits and short-term work allowances will also be raised. In the new period, social housing projects will be prioritized to help lower-income households reduce a major portion of their spending—rent.