The Turkish government requires employers to comply with strict labor laws, one of which mandates providing insurance to employees.
Employee insurance in Türkiye is somewhat complex for foreign employers due to regulatory changes. It also adds cost to the hiring process and carries the risk of non-compliance. Meeting deadlines while handling other duties, such as taxes, makes employers even more stressed.
In this post, we specifically discuss providing insurance to employees, including its types, total cost, and the ways companies use to outsource it.
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The Turkish government requires employers to comply with strict labor laws, one of which mandates providing insurance to employees.
Employee insurance in Türkiye is somewhat complex for foreign employers due to regulatory changes. It also adds cost to the hiring process and carries the risk of non-compliance. Meeting deadlines while handling other duties, such as taxes, makes employers even more stressed.
In this post, we specifically discuss providing insurance to employees, including its types, total cost, and the ways companies use to outsource it.
Author
Co-author
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Alp Atasoy
Sales and Business Development Consultant
This section explains the working process of the Türkiye insurance system for employees. It is intended to help understand the structure of Türkiye’s mandatory social security system, including its legal framework and compliance complexities.
Employee insurance in Türkiye refers to the mandatory social security system managed by SGK (Sosyal Güvenlik Kurumu).
This insurance covers employees under a unified scheme. It includes health insurance, pension contributions, and unemployment benefits. It also provides short-term protections, such as sick leave and workplace accidents.
The insurance is not optional. Once an employment relationship exists, the employer must register the employee. After that, the employer pays monthly contributions based on the employee’s salary.
The Turkish government has made it mandatory for all employers, whether local or foreign, to insure their employees who work in Türkiye. This requirement is intended to provide access to health services, income protection, and retirement benefits.
For employers, this is a legal obligation tied to payroll. Failure to comply leads to:
If employers hire employees using Employer of Record (EOR) services, they still have to pay for the insurance.
All individuals working under an employment contract in Türkiye must be insured. This applies to both local and foreign workers.
This includes:
Note that employers must register employees before their first working day.
Türkiye’s employee insurance system is centralized under SGK (Social Security Institution). This system is divided into different components. For foreign employers, understanding these categories is essential because the Turkish government calculates contributions as a combined premium.
Social Security Insurance is the umbrella system that all registered employees fall under. It combines multiple insurance branches into a single structure. SGK, the Türkiye social security institute, manages everything.
It includes:
General Health Insurance (GSS) provides employees with access to Türkiye’s public healthcare system. Once the employer registers their employees, they can receive medical treatment at public hospitals and all private facilities that have contracts, at a certain rate.
Coverage typically includes:
GSS is automatically included within SGK contributions, so it does not require separate payment.
Unemployment insurance provides temporary financial support for employees who lose their jobs under eligible conditions.
Key aspects:
This is a mandatory payroll component for employers, who must declare it along with SGK premiums.
Türkiye’s system divides coverage into two main branches:
Focuses on immediate risks and temporary income loss, including:
Covers future financial security, including:
For employers, both branches are automatically included in SGK contributions.
Employee insurance in Türkiye is a mandatory payroll cost. It is calculated as a percentage of the employee’s gross salary.
Both employers and employees contribute, but the employer carries the larger financial burden. If you are hiring in Türkiye, the true cost of employment will be significantly higher than the gross salary, with overall employment costs increasing by approximately 20–30%.
In 2026, standard contribution rates are approximately:
Employee Contributions (~15%)
Employer Contributions (~22%–25%)
Total:
Employer rates may be slightly reduced through government incentives (2%–5%), depending largely on the sector and compliance status.
Using a simplified example based on the minimum wage structure:
Total Employer Cost: TRY 40,000 – 41,000+ per month
This shows that:
It is also important to note that Türkiye operates on a net salary payment system, which can differ from many other countries. This should be clearly understood during salary negotiations to avoid confusion between gross and net salary expectations.
In addition to standard SGK contributions, foreign employers may face extra costs in the following cases:
Payroll & Compliance Costs
Severance Pay (Kıdem Tazminatı)
SGK Base Ceiling Impact
Incentive Eligibility Risks
EOR or Legal Setup Costs
So far, you have learned all the key details about providing insurance to employees in Türkiye. In this section, we outline five easy steps to set up employee insurance in Türkiye.
Before hiring employees, foreign employers must register their business as a workplace with Türkiye’s Social Security Institution (SGK). This process generates an official workplace registration number, which is important and required for all future insurance declarations and payments.
Employers must register each employee with SGK at least one day before their employment begins. This step is mandatory for both local and foreign workers and ensures that insurance coverage starts from the first working day.
Foreign companies acting as employers must collect and submit key documents, including:
These documents are necessary to complete employee registration and maintain compliance with SGK requirements.
After registration, employers must calculate insurance contributions based on the employee’s gross salary. Monthly declarations should then be submitted through the SGK system. This step ensures that both employer and employee contributions are properly recorded.
Employers are responsible for paying monthly premiums on time and keeping records up to date. Ongoing compliance includes:
When hiring employees in Türkiye, multiple tasks must be completed, and ongoing responsibilities add additional workload. These include:
All of these tasks add extra effort, time, and costs for foreign employers, influencing their decision between direct hiring or using an EOR.
If you hire employees through FMC Group as an EOR, we handle all the above responsibilities, allowing you to employ staff without a local entity.
If you already have a registered company, our recruitment services help you find the right employees efficiently. Additionally, if you already have employees in Turkey, we can also support you with related workforce needs.
Additionally, if you have employees in Türkiye, we manage insurance, payrolls, cash, and taxes under our finance management service.
Book a free 30-minute consultation call, and we’ll guide you at any stage and help your company scale further.
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