This blog by Gini Talent explores Professional Employer Organizations (PEO) and Employer of Record (EOR) services.
We will guide you on employing in Turkey, ensuring compliance, and enhancing your operations with our expert services.
Facts & Stats about Turkey
As of 2024, Turkey’s population is around 86.26 M.
The Turkish economy is resilient, with a 2023 GDP of $1024.5B, making it the world’s 17th largest.
Despite challenges like high inflation and the 2023 earthquakes, the economy grew by 4.5% the previous year. It’s expected to slow to 3.0% in 2024 but then recover.
Moreover, Turkey has a young average age of about 29.2 years and a high urban population of 77.8%.
As for life expectancy, it is around 78 years in Turkey
Currency
Turkish Lira
Principal Language
Turkish
Capital City
Ankara
Major Cities
Istanbul, Adana, Izmir
Government
Parliamentary Democratic Republic
Working Hours in Turkey
45 hours a week (maximum)
The Minimum Wage in Turkey
TRY17,002.12 gross​​.
Termination and Severance
Notice periods vary based on the length of service.
Employees who have worked a year get severance pay.
Tax and Social Security
Employers handle payroll taxes and social security in Turkey.
Regulatory Compliance
Turkey frequently updates its regulations, which can pose challenges to compliance, especially for foreign businesses.
Work Permits
Mandatory in Turkey.
What are PEO and EOR services?
PEOs and EOR services offer complete solutions for companies aiming to grow or operate in a country without setting up a local legal entity.
PEOs in Turkey manage HR activities like employment, payroll, benefits, and compliance.
On the other hand, EOR services let companies hire staff in Turkey using the EOR’s local legal structure.
These firms manage employment-related legal and administrative tasks. From Turkish payroll to compliance with local employment laws.
What is the difference between EOR and PEO services?
PEOs and EORs differ mainly in their roles and the type of employment relationships they form with client companies and their workers.
But let’s say you’re a business owner looking to expand your operations into Turkey.
You find these two main pathways to manage your team there: via a PEO or an EOR.
Think of a PEO like having a co-manager for your team in Turkey.
Now, you have decided to hire “Alex”, a software developer in Istanbul.
So you manage her work directly, set her hours, and oversee her projects.
Nevertheless, you partner with a PEO to run Alex’s payroll, ensure her benefits go with Turkish laws, and manage HR compliance.
In this case, the PEO will advise you on local labor laws but won’t become Alex’s official employer.
Now let’s say you choose an EOR instead. You still want Alex for her skills, but now, the EOR hires Alex on your behalf.
On paper, Alex’s official employer is the EOR, responsible for the legal and administrative aspects of her employment, such as payroll, taxes, and compliance with local laws.
However, you will provide the tasks and projects for Alex, but you don’t have to bother about the details of Turkish employment regulations.
In conclusion, using a PEO is like having a local HR consultant while using an EOR is like having a full HR department that takes care of everything employment-related for you.
What are the services PEOs and EORs offer?
So a PEO offers many HR services, including risk management, HR consultancy, benefits management, and payroll administration.
- Legal employment (for EORs).
- Global compliance.
- Payroll and tax management.
- Employee benefits.
- Immigration and visas.
- Contract management.
PEOs vs EORs – Which is a better service for your business in Turkey?
If you came this far in the blog, you already have an idea of what you need, however, you must keep in mind the following:
- PEOs are ideal for small to medium-sized businesses that want to outsource HR tasks but keep some control over their employees. Especially if you want to reduce tasks while still gaining expertise in the region’s regulations.
- EORs are great for companies planning to expand into new geographical areas without setting up a local entity.
Benefits of hiring employees through a PEO and EOR in Turkey
PEOs keep you informed on new regulations and amendments.
They help you adjust your policies and procedures accordingly.
PEOs and EORs services help ensure compliance with Turkish labor laws, known for their strictness and complexity.
They manage legalities around employment contracts, work hours, payroll, social security contributions, and more​.
Moreover, EOR Services can act as the legal employer on your behalf, handling all local legal requirements and employment issues.
This can significantly simplify the process of hiring and managing staff in Turkey​.
Frequently asked questions:
What type of employment contract should we provide through an EOR service?
Based on the client’s needs and local laws, we offer different contract types, from short-term projects to long-term employment. We personalize each contract to ensure it fits the situation perfectly.
How to integrate a remote foreign worker without registering a company in their country?
EOR services help remote workers feel part of the organization by offering full administrative support. Meanwhile, the client company provides strategic direction. Finally, this ensures employees stay connected to the company culture and goals.
How do we compliantly manage underperforming foreign workers?
Handling performance issues with foreign workers requires careful adherence to local employment laws, which protects the employee significantly.
EOR services include managing these HR requirements on your behalf, ensuring both legal compliance and protection for your firm and the worker​.
How do we compliantly manage underperforming foreign workers?
Handling performance issues with foreign workers requires careful adherence to local employment laws, which often protect the employee significantly.
EOR services include managing these HR requirements on your behalf and ensuring both legal compliance and protection for your firm and the worker​.
Can you help source international talent for our projects?
Yes, global staffing agencies like Gini Talent can grow their operations worldwide. They offer Employer of Record (EOR) services. Moreover, they understand Turkish laws and the local market well. Therefore, Gini Talent can handle all employment aspects, from payroll to compliance. This allows your business to tap into a global talent pool without needing a local corporate presence.
