Hiring international talent can be a complex process—especially when navigating foreign employment laws, tax regulations, and administrative hurdles. This is where an Employer of Record (EOR) becomes a game-changer. If you’re looking to expand your business into Turkey or hire Turkish employees without setting up a local entity, EOR services offer a legally compliant, cost-effective solution.
In this article, we explain what an Employer of Record is, how EOR services work in Turkey, and why more companies around the world are using this model to tap into Turkish talent.
What Is an Employer of Record (EOR)?
An Employer of Record (EOR) is a third-party organization that legally employs workers on behalf of another company. While the client company manages the employee’s daily responsibilities, the EOR handles the legal and administrative employment framework.
This means the EOR is responsible for:
- Issuing employment contracts
- Managing payroll
- Paying taxes and social security contributions
- Ensuring compliance with local labor laws
- Handling employee benefits and terminations
For international businesses, this model eliminates the need to incorporate a legal entity in the host country—in this case, Turkey.
Why Use an EOR in Turkey?
Turkey is strategically located between Europe and Asia and boasts a large, educated, and youthful workforce. However, entering the Turkish market also means dealing with its unique legal, cultural, and administrative frameworks.
Here’s why companies opt for an EOR in Turkey:
1. Faster Market Entry
Setting up a legal entity in Turkey can take months and involves significant bureaucracy. An EOR allows you to hire employees in a matter of days.
2. Local Compliance
Labor laws in Turkey are strict, and mistakes can lead to penalties or legal disputes. An EOR ensures full compliance with Turkish labor regulations, including minimum wage, severance, and employment protection rules.
3. No Need for a Local Entity
If your goal is to hire local talent without creating a branch or subsidiary, an EOR is the perfect alternative.
4. Simplified Payroll and Taxes
Turkish payroll can be complex, involving income tax, social security (SGK), unemployment insurance, and more. The EOR handles it all accurately and on time.
5. Risk Mitigation
By outsourcing employment liabilities to an EOR, your company reduces legal and financial risks related to employment.
How Does EOR Work in Turkey?
Let’s break down the process of working with an Employer of Record in Turkey.
Step 1: Agreement Between Client and EOR
Your company signs a service agreement with the EOR provider. This outlines roles, responsibilities, and costs. The EOR becomes the legal employer in Turkey, while your company retains operational control over the employee.
Step 2: Recruitment or Onboarding
You can either:
- Recruit your own candidate and ask the EOR to onboard them
- Request the EOR to assist in local recruitment
The EOR conducts background checks (if requested), drafts compliant contracts, and registers the employee with the Turkish authorities.
Step 3: Employment Contract & Legal Registration
The EOR signs a Turkish labor contract with the employee, in compliance with local laws, including:
- The Turkish Labor Code (Law No. 4857)
- Mandatory probation periods
- Social security registration (SGK)
- Work permit registration (for foreign employees)
Step 4: Payroll and Tax Management
Every month, the EOR calculates and withholds the correct:
- Income Tax
- SGK social security contributions
- Unemployment insurance premiums
- Stamp duty
Payslips are issued, payments are made, and taxes are filed with Turkish authorities.
Step 5: Ongoing HR Support
The EOR also manages:
- Paid leave
- Sick leave
- Insurance benefits
- Expense reimbursements
- Employee termination procedures (including severance)
EOR vs. PEO in Turkey: What’s the Difference?
Many confuse EOR (Employer of Record) with PEO (Professional Employer Organization). Here’s the difference:
| Feature | EOR | PEO |
|---|---|---|
| Legal Employer | EOR is the official employer | Co-employment (client also shares responsibility) |
| Requires legal entity | No | Yes |
| Best for | International companies without a Turkish entity | Companies with a local Turkish entity |
So, if your company doesn’t yet have a presence in Turkey, an EOR is the right solution.
Key Legal Considerations in Turkey for EOR
Here are important legal elements that an EOR in Turkey must comply with:
1. Social Security (SGK)
Both employer and employee contributions are mandatory. The EOR ensures proper registration and monthly declarations.
2. Income Tax Withholding
Progressive income tax rates apply in Turkey. The EOR handles withholding and submission.
3. Work Permits for Foreigners
If the employee is not a Turkish citizen, the EOR applies for a work permit through the Ministry of Labor.
4. Termination Rules
Terminating an employee in Turkey can be sensitive. Severance pay, notice periods, and valid cause must be respected. The EOR manages this within legal boundaries.
Industries That Commonly Use EOR Services in Turkey
- Technology & Startups: Hiring Turkish developers or engineers remotely.
- Construction & Engineering: Quick setup for short-term or project-based teams.
- Retail & Manufacturing: Testing the market before setting up a full branch.
- Consulting & Finance: Assigning local representatives or analysts.
How Much Does an EOR Cost in Turkey?
Pricing models vary, but EOR services in Turkey are usually billed as:
- A monthly fee per employee, OR
- A percentage of gross salary (typically 10–15%)
Costs cover payroll processing, compliance, HR management, and legal support.
An Employer of Record in Turkey is the ideal solution for companies looking to hire talent quickly and compliantly—without the cost and complexity of setting up a local business entity. Whether you’re expanding into the Turkish market or simply want to hire a remote employee based in Istanbul or Ankara, EOR services offer a flexible, legally sound, and time-saving option.
We specialize in providing EOR services in Turkey. From payroll and tax compliance to employee onboarding and HR support, we make it easy for international companies to hire in Turkey with full confidence.
Ready to hire in Turkey?
Contact us today for a free consultation and discover how our EOR solutions can support your business growth.